Artificial intelligence (AI) doesn’t just inform decisions at AAA Northeast, it has the keys and takes the wheel, says company president and CEO John Galvin ’91MBA.
“We had to let some senior leaders go because they felt that data should just advise them,” says Galvin, who spoke to the Bryant community on March 28 about creating value from AI in business. “I think data is customers telling us what they need, so we need to let it drive us.”
That attitude is a far cry from the culture Galvin encountered when he arrived at AAA after a long career as chief financial officer at tour company Collette. “I didn’t even get a laptop — they didn’t believe in tech,” he says.
That all began to change about eight years ago when, under Galvin’s leadership, AAA partnered with Adobe as an alpha-test site for the company’s developing AI program. “We were popular with their product development team because we were in a lot of product lines they were interested in and had a lot of members and data,” recalls Galvin.
AAA’s diverse business includes providing roadside assistance, travel planning, and insurance. A not-for-profit corporation, AAA is a service-oriented company, so the top goal for AI integration was providing a personalized experience; others included optimizing marketing and tracking sales and cross-selling across product lines.
Galvin says a culture that accepts failure and constant testing has been necessary to build AAA’s AI infrastructure. “You’ve got to be innovative and creative to make this work,” he says.
Today, approximately 70 percent of new AAA memberships are generated online, and the company uses AI for near-constant monitoring of customer activity, says Lisa Melton, chief marketing officer at AAA Northeast. “We have a digital-first mindset,” she says.
“We have a digital-first mindset."
“We used to flood people with marketing, and overwhelmed them,” Melton says. “We took our entire marketing team in-house and used AI to optimize our marketing on a near real-time basis. There are a lot of things our members don’t know about us, but now we can see who, what, and how about how prospects are converted to sales.”
Melton is a believer in following the lead of AI in marketing because it allows her to see the process and results “from start to finish,” she says.
Mark Pelletier, AAA’s senior vice president for digital business strategy and e-commerce, says the company can now look at data anomalies and adapt to them daily. “It gives us the ability to act quickly,” he says.
AI provides AAA with trends analysis and generates customer profiles based on millions of data points gathered from interactions via the Internet, phone, mail, call center, purchases, and the company’s CRM system. It’s used to predict the success of individual marketing campaigns, target e-mail marketing, and improve internal workflow.
On the membership side, “We can tell [agentic] AI to go find people you think want to join AAA,” says Pelletier. AI-driven predictive algorithms and propensity models have yielded insights like the fact that Gen Z members living in urban areas like to rent cars for daily living, not just on vacation.
“We can tell AI to go find people you think want to join AAA."
Interestingly, however, AAA has not employed generative AI in the form of a chatbot, which Galvin says runs counter to the goal of delivering personalized service.
Galvin’s MBA alma mater has aided in AAA’s success. Bryant students in the “Big Data Analytics and Data Science” capstone courses taught by Suhong Li, Ph.D., chair of the Information Systems and Analytics Department, have for several years used large data sets from AAA to profile and segment members based on demographic information and their history of interacting with the company.
Student projects also have helped AAA identify cross-selling opportunities, predict the likelihood of membership cancellation, estimate the probability of members purchasing AAA insurance products, forecast annual travel sales, and predict customer propensity for booking cruises, says Li.
Pelletier admits that the company has become “wholly dependent” on AI, and Galvin says, “we would need an army of analysts if we didn’t have AI.”
“We would need an army of analysts if we didn’t have AI.”
The bottom-line result of the lap of faith with AI, however, has been $200-million growth in AAA’s travel business.
Galvin says employees of companies that fully integrate AI into their operations need to adapt to the technology, not fear it. Pelletier told Bryant students and faculty that AAA is looking for job applicants who are familiar with data and can be trained but, more importantly, are “naturally inquisitive, like teamwork, and are comfortable with failure.”
“We still need people to guide AI, not set and forget it,” he says.
