AI and ChatGPT casualties

Chegg, Inc. (CHGG) is the latest AI and ChatGPT casualties. Recently the company announced that Artificial Intelligence (AI) and ChatGPT will negatively impact its business and revenues. Yesterday May 2nd 2023, the stock tanked more than 40% in a single session. Chegg provides education and training services. It operates direct-to-student learning platform that supports students starting with their academic journey and extending into their careers with products and services to support learner with their academic course materials. This platform is now threatened by the rise of ChatGPT. Anyone now can use the AI service to create learning materials and use it for educational purposes. I wondered what could be other businesses that can take a hit from AI? In this article I will try to explore that.

First let me provide more explanation on what is ChatGPT. As an AI language model, ChatGPT has been designed to assist users in generating human-like text responses to their inquiries. ChatGPT uses advanced algorithms to analyze and understand the context of the questions and generate relevant responses.

ChatGPT has the potential to replace some human labor in certain types of businesses. Here are some examples of businesses that ChatGPT can replace or augment:

1. Customer Service: ChatGPT can be used to handle customer inquiries, complaints, and support requests. This can help reduce the workload of customer service representatives and provide customers with 24/7 support.
2. E-commerce: ChatGPT can be used to handle product queries, help customers with their purchases, and provide personalized product recommendations. This can help reduce cart abandonment rates and increase sales.
3. Content Creation: ChatGPT can be used to generate content such as product descriptions, social media posts, and blog articles. This can help businesses save time and resources on content creation.
4. Personal Finance: ChatGPT can be used to provide financial advice and answer questions related to personal finance. This can help individuals manage their finances more effectively and reduce the need for human financial advisors. BlackRock, Vanguard, Fidelity, State Street Global Advisors, and J.P. Morgan Asset Management are the five largest financial advisory firms in the United States, ranked by assets under management (AUM). I wonder if their business will take a hit from ChatGPT.
5. Travel and Tourism: ChatGPT can be used to provide information on travel destinations, hotels, and local attractions. This can help travelers plan their trips and reduce the workload of travel agents. Tripadvisor, Inc. (TRIP), Expedia Group, Inc. (EXPE), and Booking Holdings Inc. (BKNG) are all prone to having their business shrink as a result of people using ChatGPT for an alternative.
6. Human Resources: ChatGPT can be used to answer employee queries related to benefits, policies, and company culture. This can help reduce the workload of human resources representatives and provide employees with quick and accurate answers to their questions.
7. Education: ChatGPT can be used to provide personalized learning experiences and answer student queries related to course materials and assignments. This can help reduce the workload of teachers and provide students with immediate feedback. Chegg falls under this category.

On the other hand, companies that will use the aid of ChatGPT and AI in their operations are also prone to having their businesses ruined. While ChatGPT has been designed to help people, it is possible that it can have negative effects on certain businesses. Here are some ways in which ChatGPT can ruin businesses:

1. Misinformation: ChatGPT’s responses are generated based on the data it has been trained on. This means that if the data is inaccurate, ChatGPT can provide misinformation to users. If businesses use ChatGPT to answer questions about their products or services, incorrect responses can damage their reputation and result in a loss of customers.
2. Lack of Personalization: ChatGPT is not capable of understanding the emotions and needs of individual customers. This means that businesses using ChatGPT may fail to provide personalized responses to customers. This can lead to a lack of customer satisfaction and loss of business.
3. Security Issues: ChatGPT can be susceptible to security breaches. If hackers gain access to ChatGPT, they can use it to extract sensitive information from customers. This can result in a loss of customer trust and damage to the reputation of businesses.
4. Dependence on Technology: By relying too heavily on ChatGPT, businesses can become dependent on technology. This can make them vulnerable to technical issues, such as power outages, system crashes, or bugs. In such situations, businesses can lose valuable customer interactions and suffer a loss of business.
   

ChatGPT can be a valuable tool for businesses looking to streamline their operations, reduce costs, and provide faster and more personalized services to their customers. While it may not be able to replace all human labor, ChatGPT can augment human workers and improve the efficiency and effectiveness of various business processes. It can be an effective tool for businesses to improve their customer service and interaction. However, businesses should be aware of the potential risks associated with using ChatGPT and take measures to mitigate these risks. While ChatGPT can save time and money, it should not be relied on solely to replace human labor, provide accurate information, or personalize responses.

Considering the above, ChatGPT can have a bad effect on business that use it and those who compete with it. Investors should be aware of these risks but more research is needed in my opinion. In addition, the way companies adapt and deal with this new technology can also impact the outcome.