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Listen: The Standard’s Tech and Science Daily podcast interviews Dr Mark Kennedy about Chinese AI company DeepSeek

Evie Burrows-Taylor — Mon, 03 Feb 2025 09:58:57 +0000

Listen: The Standard’s Tech and Science Daily podcast interviews Dr Mark Kennedy about Chinese AI company DeepSeek Evie Burrows-Taylor Mon, 03/02/2025 - 09:58

28 January 2025

ITV News interviews David Shrier about DeepSeek’s emerging dominance in the technology market

Evie Burrows-Taylor — Mon, 03 Feb 2025 09:49:09 +0000

ITV News interviews David Shrier about DeepSeek’s emerging dominance in the technology market Evie Burrows-Taylor Mon, 03/02/2025 - 09:49

27 January 2025

The Times features 51�Թ��’s new Venture Capital Fellowship

Evie Burrows-Taylor — Mon, 27 Jan 2025 12:05:17 +0000

The Times features 51�Թ��’s new Venture Capital Fellowship Evie Burrows-Taylor Mon, 27/01/2025 - 12:05

22 January 2025

Education and Learning

"No jobs are safe from AI, but some are safer than others": Professor of Practice David Shrier on the future of work

David Shrier — Wed, 15 Jan 2025 12:14:02 +0000

"No jobs are safe from AI, but some are safer than others": Professor of Practice David Shrier on the future of work

David Shrier Wed, 15/01/2025 - 12:14

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"No jobs are safe from AI, but some are safer than others": Professor of Practice David Shrier on the future of work

11 May 2026

The rapid advancement of artificial intelligence (AI) has left the workplace in flux. Many of those already in the workforce fear for the future of their roles, while those about to enter it are told they need to be skilled at using the latest technology to make themselves attractive to employers.

Amid all this career anxiety, research shows that while 85 million jobs will be displaced by 2025, 97 million new roles will simultaneously emerge, representing a net positive job creation of 12 million positions globally.

Across the entire economy, generative AI will have a profound impact, leveraging 32 per cent of each job’s function on average to boost productivity.

So, what do business school students need to know when considering their future careers, and how do they ensure they're ready for the workplace transformation already underway? Here, 51�Թ�� Business School's Professor of Practice, AI & Innovation, David Shrier reveals all.

The sectors that need a human touch

Unsurprisingly, safer sectors include those that require a talent for building relationships, as well as professions where you need to show empathy, judgement, communication and creativity. Or else, where some level of physical expertise is necessary.

Both hospitality and events are projected to grow globally in the next few years, driven in part by a reaction to the rise in technology and the desire for real life experiences.

As energy security looms large, the transition to clean energy and soaring energy demands from data centres will fuel a long-lasting need for qualified energy experts, technicians and engineers – particularly those who can work with systems to optimise the electricity grid and secure supply. Similarly, jobs in defence technologies will continue to expand amid turbulent geopolitics.

Meanwhile, there’s an enduring and worldwide dearth of cybersecurity skills, with nearly five million jobs unfilled at a global level. The complex and highly specialised nature of this field means these are hard posts to fill.

It's also worth considering manufacturing sectors, which are less exposed to AI disruption than professional services.

The jobs under threat

Work that requires high-level thinking and intelligence appears to be the most prone to upheaval thanks to AI, according to an analysis of some 800 occupations across 160 million jobs.

These are typically the professions that pay more than $100,000 a year, such as high value-added roles within professional services including law, finance and business consultancy.

As an example, logistics used to be a high paying, valued profession that required heavy cognitive lifting, but today it can be done more easily and cheaply by a computer. But while backroom functions can be easily automated, the hands-on labour of a builder or warehouse worker is often too complex to replace.

The big rewards for future business leaders

If businesses can deploy AI in the most effective way, the return on investment is huge – far higher than if they simply replace humans with AI, which is the worst way to use it.

Companies that can figure out how to augment employees’ performance using of AI tools could see a return on investment of up to 200 per cent. This requires often painful changes but avoids large scale layoffs.

There’s an even greater prize, and one we encourage students to test within the safe confines of 51�Թ��’s classrooms. This is working alongside AI as an equal to create something we call symbiotic intelligence, which can give a massive return on investment of up to 2,000 per cent.

If that sounds improbable, consider an example of a business founder who leveraged a host of AI agents and tools to create telehealth business Medvi, which generated around $400 million in its first year with just two employees. While questions have been raised about some of Medvi’s business practices, that shouldn’t distract from the proof of concept it offers around operating leverage on AI systems. We will see more of this. Rather than treating AI as a tool for automation or efficiency, the founder can use creativity and judgement to build a business around the emerging capabilities of the new technologies.

Can you really future proof your career?

Students can actively seek to be "AI ready": to be an employee who uses AI to improve their performance rather than replaced by it. If they can learn to work symbiotically with AI, they will dramatically outperform those who can’t. Just as a novelist requires language literacy, students need AI literacy, but also the judgement to deploy it.

This comes from hands on experience. At 51�Թ�� we embed AI directly within the curriculum and we’ll encourage students to experiment, by building an AI native company, for example.

University gives students the freedom and space to experiment beyond the glare of performance reviews. Much has been made of the high failure rate of AI pilots within businesses – up to 95 per cent, according to one report. In my view, that’s not high enough. You need a reframe: this is innovation exploration, not "failure". Thomas Edison famously said he’d never failed but had instead discovered "10,000 ways that didn’t work" before successfully creating a lightbulb.

Tips for success

Efforts to build your innovation skills will never be wasted. Even if you’re not starting a business, you’ll need to reskill and reorient yourself rapidly to stay current.
Purposefully lean in to the skills that distinguish our humanity such as emotional intelligence, teamwork, empathy – the kind of skills AI doesn’t do well.
Experiment with AI tools to find more than productivity gains.
Build your fundamental sales skills. Neglected from many top tier MBA programmes, these are offered at 51�Թ��. Being able to sell even in a tough market will always add value.

At 51�Թ��, we embrace rather than dismiss AI, teaching students the skills necessary to navigate the turbulent contemporary workplace.

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What business school students need to know about choosing a career in the AI workplace

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Will European regulators shape Hollywood’s bidding war?

Tommaso Valletti — Wed, 15 Jan 2025 12:14:02 +0000

Will European regulators shape Hollywood’s bidding war?

Tommaso Valletti Wed, 15/01/2025 - 12:14

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5 February 2026

Article at a glance

The European Commission (EC) competition authority is scrutinising rival bids for Warner Bros. from Netflix and Paramount, an unusual scenario
Both bids raise different competition concerns
A frontrunner could emerge if one bidder gets cleared before the other
The EC prefers light-touch remedies
US politics, not Europe, is likely to decide the winner

A bidding saga across the Atlantic

Europe’s competition regulator is simultaneously reviewing competing bids by major US companies Netflix and Paramount to acquire entertainment company Warner Bros. This is unusual and strategically sensitive, given the current geopolitical climate. The bidding saga has attracted significant attention on both sides of the Atlantic.

Both bids raise competition concerns, but in different ways:

The Paramount deal would reduce rivalry between two major Hollywood studios.
Netflix’s acquisition of Warner Bros. would increase market dominance in streaming across Europe

Professor Tommaso Valletti, Professor of Economics at 51�Թ�� Business School and former Chief Competition Economist at the EC, questions whether the EC will act boldly, given its preference for light-touch remedies and geopolitical considerations. US politics, not Europe’s regulators, may ultimately decide the winner.

What’s at stake

Netflix agreed to buy Warner Bros.’ studios and streaming assets in a transaction valued around $82.7 billion. To challenge this, rival Paramount Skydance launched a hostile takeover bid for the entire company, including news network CNN, worth $108 billion, offering shareholders a higher per-share cash price.

The Warner Bros. board backs Netflix, but competition concerns are significant and more complex than the ones associated with Paramount’s bid.

A lack of clear precedent in the EU merger control raises a key question: how will the EC proceed?

Because all three companies operate across Europe and the Americas, the European Commission must review the market implications under its EU merger control framework. A simultaneous review could shape the race. By clearing one bidder, while subjecting the other to a longer investigation, a frontrunner could emerge.

A lack of clear precedent in EU merger control raises a key question: how will the EC proceed? Historically, the regulator tends to favour light-touch remedies, like small divestitures or access commitments, over prohibitions.

Netflix: from scale to market power

Netflix’s story of scale in Europe has shifted to revenue diversification. Netflix already shows signs of pricing power: in the UK, a standard subscription rose from £6 to £13 per month over the past decade. A deal with Warner Bros. would lead to:

Further market concentration: Netflix already holds over 50 percent of Europe’s subscription video-on-demand (SVOD) market. Combining this with Warner Bros.’ studios, HBO Max and other streaming platforms would increase its dominance.
Monopolisation of streaming content: Netflix could control one of the largest content libraries and production pipelines in the world, cutting off production for cinemas and other traditional content platforms.

Netflix could address these concerns through remedies such as divesting HBO Max. Its likely defence would be that its streaming services compete with a broader digital entertainment market, including social media and video gaming. Regulators may accept this argument to some extent, although previous merger reviews have generally used a narrower, SVOD-focused market definition.

Paramount: traditional Hollywood rivalry

Paramount’s acquisition of Warner Bros. raises more traditional competition concerns. Combining two established major Hollywood studios would:

reduce industry rivalry and lead to fewer big players in Hollywood,
increase bargaining power over distributors, advertisers and creators, and
potentially lead to fewer market players, less innovation, higher costs for consumers.

The deal would also continue the consolidation of Hollywood studios that has been ongoing for 50 years, reducing the “Big Five” studios (Disney, Warner Bros., Universal, Paramount and Sony) to four. Disney would remain number one, possibly facing stronger competition from the combined entities currently ranked number two (Warner Bros.) and number five (Paramount).

While the merger could be easier to clear overall, overlaps between the studios, for example franchises between Paramount and Warner Bros., could still raise competition concerns that may be harder to address.

Why Europe and the US may decide differently

Whether the EC’s decision will impact the deal remains uncertain. In the US, regulators face a different and more political context. Paramount’s bid would include CNN, which Netflix is not acquiring. President Trump, a vocal critic of CNN, has previously argued that the network should be sold or restructured. These dynamics may influence the outcome.

Given the current political climate, a European ban on either deal seems unlikely. While the EC can still influence the pace and outcome of the bidding war, the winner will ultimately be decided in the US.

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A rare regulatory scenario could see Brussels tilt the Netflix - Paramount battle for Warner Bros.

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When winning comes at a price: The business of pay-to-win add-ons

Mushegh Harutyunyan — Wed, 15 Jan 2025 12:14:02 +0000

When winning comes at a price: The business of pay-to-win add-ons

Mushegh Harutyunyan Wed, 15/01/2025 - 12:14

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17 September 2025

The video game industry is booming. According to Statista, more than three billion people played video games worldwide in 2024. As per PwC’s Global Entertainment and Media Outlook 2022-26, the gaming industry is tipped to maintain its recent rapid growth, and could be worth $321 billion by 2026. A big slice of that — $82 billion in 2024 — came from in-game purchases such as cosmetic “skins”, virtual currency, map packs, and more. In the UK, a recent Censuswide poll revealed that gamers, on average, spend £540 a year on in-game purchases (£22 a month) and subscriptions (£23 a month).

One of the most debated forms of in-game spending is the pay-to-win add-on, a digital item that gives players a clear advantage in player-versus-player games. A special weapon in Call of Duty: Warzone, a premium camouflage in Escape from Tarkov, or unique cards in Hearthstone can tilt the odds decisively in favor of paying players. For the buyer, these items boost the chance of winning; for everyone else, they create a frustrating disadvantage. One gamer described their game experience bluntly: “It was absurd and halfway to unplayable if you didn’t drain your wallet.”

The developer’s dilemma

At first glance, offering P2W add-ons seems like easy money. They cost little to produce and appeal directly to players’ powerful motivations: the desire to win and the dread of losing. Yet our research shows that the business case is more nuanced.

Unlike traditional add-ons (like hotel WiFi or an extended warranty), the value of P2W items is shaped by network effects. Their appeal grows when few players own them, because they confer an advantage over many others. But as adoption of P2W items spreads, their edge diminishes.

Players who do not spend on P2W may abandon the game entirely as they face a daunting competitive disadvantage against the large number of P2W owners. The fewer non-buyers remain, the smaller is the pool of players against whom P2W will bring an advantage, further eroding the add-on’s value. This negative network effect created by the P2W add-ons calls for a careful assessment of market conditions before introducing them. We find that ironically, when a large share of players is willing to buy, introducing P2W can reduce profits, leaving developers better off without it.

The psychology of competition makes this balance even trickier. Players who are highly motivated by winning make the add-on more lucrative: the thrill of victory increases their willingness to pay. But the story is different with loss sensitivity. If defeats sting only mildly, add-ons hold little attraction. If they sting too much, non-buyers disengage altogether. Developers can influence these sensitivities through design choices — making victories more rewarding while keeping defeats painful but not unbearable.

Design and pricing

One might assume that the stronger the add-on, the better for profits. Yet our findings suggest otherwise. Making the add-on too powerful discourages non-buyers from playing at all, shrinking the competitive field and eroding the add-on’s value. In highly competitive genres, developers may actually benefit from deliberately limiting the power of pay-to-win items, ensuring the game remains engaging for all.

The introduction of P2W items forces developers to lower the base game price to keep P2W-non-buyers in the fold, compensating their disadvantage against P2W-buyers. In some cases, this means shifting to a freemium model, or even — in theory — setting a negative price, paying players to participate because their presence sustains the market for add-ons. And while lower prices might seem to discourage investment in quality, the opposite can happen: when losses feel especially painful for non-buyers, developers are pushed to raise quality to keep them engaged.

Perhaps most surprising is what this means for players themselves. P2W is often accused of undermining fairness and reducing enjoyment. Yet under the right conditions, our analysis shows it can actually increase player surplus. By broadening the player base and motivating higher investment in quality, the system can leave players better off than in a world without P2W.

Keeping the pond healthy

Players are often categorised into "whales" (big spenders), "dolphins" (moderate spenders) and "minnows" (low or non-spenders). For developers, pay-to-win add-ons are a tempting way to extract more profits from the less price-sensitive whales and dolphins. Yet their very success depends on the participation of the more price-sensitive minnows. These players may never spend much, but their presence ensures that competitive advantages remain meaningful for others. If minnows abandon the game, the pond dries up — and the value of P2W erodes with it.

The lesson is clear: introducing P2W is not simply about monetizing the biggest spenders. It is about keeping the entire ecosystem in balance. Developers who want sustainable profits must design their games so that whales, dolphins, and minnows can all swim in the same pond — even if not on equal terms.

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Pay-to-win (P2W) add-ons are controversial in the gaming industry. New research by Mushegh Harutyunyan and Esma Koca reveals when a game developer should introduce a P2W add-on and how to design and price it.

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Shaping smarter healthcare decisions through economic evaluation at 51�Թ��

Shamita Harsh — Wed, 15 Jan 2025 12:14:02 +0000

Shaping smarter healthcare decisions through economic evaluation at 51�Թ��

Shamita Harsh Wed, 15/01/2025 - 12:14

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Professor Anita Patel, Provost's Visiting Professor of Health Economics at 51�Թ��, talks about the thinking behind the recently launched 51�Թ�� Health Economic Evaluation (IHEE).

IHEE is a new joint initiative between 51�Թ�� Business School and the School of Public Health to build a flagship institutional capability in health economic evaluation. Its aim is to embed robust economic analysis at every stage of health innovation and research, supporting both internal projects and eventually external partnerships.

Q: What inspired the creation of the 51�Թ�� Health Economic Evaluation initiative?
In any resource-constrained system, any ‘new’ programme or innovation - be it a medicine, medical device or a different way of delivering a care pathway - often requires robust economic and outcomes data to demonstrate value for money, either to justify new investment or to understand the implications of redirecting existing resources. Throughout my career, I’ve worked on economic evaluations for health interventions across national and global settings, so I understand well the methods, process and value of generating such evidence robustly.

51�Թ�� is home to outstanding health-related research across all faculties, from basic sciences through to translational (research that is concerned with facilitating the practical application of scientific discoveries to the development and implementation of new ways to prevent, diagnose, and treat disease). But embedding economic evaluation into research has often been challenging due to underdeveloped capacity at 51�Թ�� in this area of health economics.

Health economists and other related capabilities are dispersed across faculties and departments at the university – with some critical masses at the Business School and the School of Public Health. However, they have tended to converge around specific areas of research, e.g. infectious diseases, which entail specific methodological focuses.

While such expertise is helpful for specific areas there is a wider need that draws on a whole mix of approaches across different clinical contexts and this kind of generalisable economic evaluation within an organised structure has been a long-standing gap area at 51�Թ��, leading to those needing economic evaluation expertise to frequently look for this outside the institution.

IHEE directly addresses this fragmentation and gap by consolidating expertise within a centralised collaborative hub that strengthens 51�Թ��’s capacity in this crucial area.

Ultimately, it’s about embedding economic insight into every step of health innovation across all of 51�Թ��’s health-related ecosystem, so that great ideas don’t just remain ideas - they become sustainable, impactful solutions.

We hosted a launch event in June 2025 to introduce this new initiative designed to strengthen 51�Թ��’s capacity for economic evaluation in health research. IHEE embodies 51�Թ��’s strategy of scientifically grounded interdisciplinary research.

During my time at 51�Թ�� so far, I have been mapping the economic evaluation landscape across the college and have spent many hours speaking individually with people who have any interest in economic evaluation, whether in undertaking this kind of research, or needing support in it. As a next phase, the event was focussed on bringing people in a room together to have open conversations about who needs what kind of support so that the shape and nature of IHEE fits the need.

We intentionally brought together the “supply” of economic expertise and the “demand” from researchers and clinicians in one space. We are committed to engage in a way that includes all staffing levels for socially impactful collaboration. So the event intentionally drew on early career researcher involvement to widen the ownership of the initiative and allow it to evolve to meet the needs of future health challenges. It’s an opportunity to map capability, build relationships, and start thinking strategically about how to embed this across 51�Թ��’s health research legacy.

Q: How do you plan to engage with external stakeholders interested in health economic evaluation?

The first step is visibility. Creating a named entity - 51�Թ�� Health Economic Evaluation - gives funders, partners, and all stakeholders something concrete to connect with. There are obviously some basic administrative prerequisites e.g. an email point of contact, a dedicated webpage, directory of expertise and support mechanisms to make collaboration easier.

But it’s really about building meaningful connections and a track record. Isolated successful projects don’t in themselves signal long-term capability. A structured network with active and invested members, strong and impactful outputs, and shared goals does. Other researchers and funders want to engage with teams that are credible, diverse, and strategically aligned.

Q: How important is it to deal with the complexity of health economics before solving challenges at large scale?
Health challenges are rarely isolated. They sit within wider structural contexts that involve social, behavioural, political, commercial, environmental, and technological dimensions. Economic evaluation of potential solutions would ideally account for such context in understanding value – although in reality the extent to which this happens is driven by the nature of decision-making frameworks, both explicitly and implicitly.

Nevertheless, interdisciplinary approaches are often necessary even when not allowing for the full scale of complexity.

For example, if assessing a robotic surgical tool, it is relevant to account for engineering insights, clinical outcomes, patient and professional experiences, and market potential. Or in evaluating post-heart-attack behavioural interventions, it may be important to consider patient psychology, caregiver burden, and long-term cost implications including impacts on work productivity.

We want IHEE to be a diverse and versatile collection of expertise that not just undertakes economic analysis for others but offers informed ideas and contributions to help frame these interdisciplinary questions in a way that leads to meaningful, actionable and scalable insights.

Health, innovation and improvement is not just about the human body but also people's behaviour and the conditions in which illness arises and the conditions in which illness can be solved.

Q: What kind of projects can drive innovation in this space?
We’re already seeing engagement across domains: engineers developing health tech, clinicians designing care models, and social scientists working on behavioural interventions. Projects might range from national policy evaluations to local, community-based studies.

Crucially, we want evaluations to reflect real-world impact - not just system efficiency but also the lived experience of patients and carers. Embedding economic evaluation from the outset ensures research has both scientific and societal relevance.

Q: What does the initiative need to succeed and what is its long-term vision?
Strong foundations are essential for growing capabilities that are relevant and sustainable. Initially, we need a few key ingredients like resourcing for key posts, and commitment to a growth plan. Along with the initial investment, we need people who can dedicate energy to drive this forward with a truly collaborative spirit that can move beyond siloed thinking. A centralised hub is important for facilitating this.

A few high-quality grant wins can change everything. They enable us to recruit dedicated researchers who can embed economic thinking into everyday research. We also can't achieve a long-term roadmap that is simply led by senior academics - PhD students and early-career researchers are critical for giving the initiative life through initiating ideas and projects, contributing to training and development, and ultimately sustaining the work and human connections.

In an organisation as large and diverse as 51�Թ��, that might well entail tricky internal conversations about sharing credit, rethinking collaboration and funding allocation mechanisms, and embracing new ways of working – but these are all just processes and it is important to keep a clear view that they merely exist to support the end goal of producing excellent research that informs policy and practice. 51�Թ�� has world-leading expertise.

But to realise our full potential, we need to act as one - cohesive, connected, and committed to collaboration.

Note: This Q & A was updated ton 04.04.2025 to better reflect the outcomes of the IHEE launch.

In conversation with Professor Anita Patel to learn about the strategic launch of 51�Թ�� Health Economic Evaluation

Main image: Launch of the 51�Թ�� Health Economic Evaluation initiative | 51�Թ��

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AI-powered rental fashion: Smarter recommendations for a sustainable future

Gah-Yi Ban — Wed, 15 Jan 2025 12:14:02 +0000

AI-powered rental fashion: Smarter recommendations for a sustainable future

Gah-Yi Ban Wed, 15/01/2025 - 12:14

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6 May 2025

Fashion is one of the most polluting industries in modern times. It produces about 10 per cent of the UK's annual carbon footprint – more than all international flights and maritime shipping combined. Research from Climatetrade, 2023, shows it also consumes vast amounts of water and generates millions of tons of waste. According to Fashion Transparency Index 2023, the constant demand for cheap clothing has made the industry a "key driver of human rights abuses". One of the largest study into clothing habits ever undertaken by climate action NGO WRAP shows the UK's wardrobes hold 1.6 billion items of unworn clothes.

To address some of these challenges, a new business model of subscription rental fashion has sprung up in recent years. Established brands like LK Bennett and Ann Taylor, along with startups such as Hurr, My Wardrobe HQ, nuuly, and Armoire, now offer rental services that allow multiple customers to “share” a much larger wardrobe, reducing the need for constant new purchases. These companies operate on a monthly subscription model, enabling members to rent and swap garments within each period. Returned garments are inspected, cleaned, and recirculated, ensuring efficient inventory use. The rental fashion business model has potential for reducing waste, lowering emissions, and extending the lifecycle of clothing, all the while keeping customers stylish and satisfied.

The challenge of keeping customers engaged

As operations researchers, my colleagues and I, together with a PhD student, Jiannan Xu, were drawn to rental fashion because of the operational complexity it presents. We partnered with a rental fashion startup and analysed its customer data. One issue stood out from the analysis: customers were not staying on the platform long enough. Many left after the initial discounted trial period, citing dissatisfaction with the style or fit of their rented items.

To improve retention and enhance the customer experience, we developed a novel approach to optimising personalised recommendations for rental fashion businesses. Our work focused on two key challenges:

Encouraging customers to subscribe – many companies offer discounted trials, yet potential subscribers hesitate because they’re unsure whether they’ll find styles they like.
Retaining customers beyond the trial period – a large percentage of cancellations stem from product fit uncertainty. Customers may select items based on images and descriptions, only to find that they don’t meet expectations in person. This mismatch leads to frustration, increased returns, and lower renewal rates.

Smarter assortment optimisation with AI

To tackle these issues, we developed an AI-powered algorithm that improves how rental companies curate product recommendations. Instead of relying on generic recommendation engines or brute-force optimisation, our model develops and optimises a stochastic decision model to account for the unique structure of rental fashion businesses. Specifically, it considers:

Initial selection uncertainty – predicting which items are most likely to encourage customers to subscribe.
Renewal uncertainty – identifying which items will maximise customer retention after the first rental cycle.

By carefully balancing these factors and using smart mathematical approximations, we developed a fast, scalable, and personalized ranking algorithm—one of the simplest and quickest methods for optimising the assortment curation process. Essentially, our algorithm gives a personalised score to each garment, whereby the score weighs in the expected consumer surplus (“signal”) and the uncertainties regarding the customer’s initial and post-wear valuations (“noise”). It thus has parallels with finance and engineering applications where good decisions are made by balancing signal-to-noise ratios.

Alternative methods to our algorithm would be either too slow for real-time use, or ineffective as they do not optimise the business objective. In extensive numerical simulations, we show our algorithm ranks and refines product assortments in milliseconds, compared to minutes using brute-force optimisation. We further show that, even under stress-testing scenarios, our algorithm can achieve results within 6.5 per cent of the best possible profit outcomes, making it both effective and scalable.

Practical benefits for rental fashion companies

Beyond technical advancements, our research has real-world implications for the rental fashion industry. By ensuring that customers receive better-matched recommendations, businesses can reduce unnecessary returns and improve overall satisfaction. This leads to:

Fewer shipments and exchanges, reducing logistics costs.
Better use of inventory, maximising item circulation.
Higher customer retention rates, strengthening long-term profitability.

The future of AI in subscription-based rentals

Beyond rental fashion, the principles behind our AI-powered optimisation model extend to subscription-based rentals of experience goods in general. This includes electronics rentals, furniture subscriptions, and toy libraries, where selecting the right assortment is key to customer satisfaction and retention. By refining product recommendations, businesses can optimise customer engagement, reduce churn, and improve profitability.

Our research is among the first to explore assortment optimisation in this space, setting the stage for further studies in inventory and subscription management. While rental businesses may not solve all the environmental challenges, smarter, AI-powered recommendations can significantly enhance business viability and the overall customer experience—paving the way for a smarter, more efficient future in rental commerce.

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