AI (Artificial Intelligence) is one of the most common used buzzwords right now when it comes to marketing. The difficult part for most people is understanding who is truly delivering an innovative technology versus vaporware.
While AI is defined as the theory and development of computer systems to be able to perform tasks that normally require human intelligence, the broader applications of AI are far greater than just using a machines to place your order at McDonalds.
AI is about getting LOTS of information quick. Actually, very quick. At a rate that would really be unfathomable for a human to collect in such a short time frame. While AI is being utilized by businesses and professionals across many different industries, marketers are one of the later industries to put AI in the forefront of solving business challenges.
Marketing is a pretty expansive term, so how does AI relate?
Let’s take a look at Stitchfix, an online subscription and personal shopping service. This company uses AI to improve clothing predictions. They do this through hundreds of algorithms created by data scientists. An example of one of those algorithms: it learns from images so it can check a client’s Pinterest pins and learn what styles she’s favoring, even if the user has a hard time articulating it in an online form or in comments.
This is customizing and tailoring user experience, and heightening customer satisfaction. The company is currently sitting at $730 million in revenue, so they’re doing something right.
AI helps retailers serve a more personalized message to target customers. It’s not only showing customers relevant products and deals, but it’s delivering these messages in a style that is preferable to the user. This technology can deliver answers in real-time as marketers pursue existing customers, telling them who to target, what products to place in front of them, why customers are buying these products and more.
Leveraging AI to target customers allows marketers to pinpoint individuals based on their actual behavior, and even go as far as to anticipate their likes and needs. Basically, AI is helping to write the “little black book” that marketing professionals have been searching for for ages.
While we have seen interesting solutions using AI to help marketers better engage with their customers to optimize experience, we have not seen AI leveraged to help a marketer better understand WHERE to capture new customers when they are in buy mode.
With AI, marketers are now able to understand patterns and linkages, allowing them to predict what customers want to buy and where they’re most likely to purchase it. This goes yet another step further into showing marketers where to spend online advertising dollars, which is the “holy grail” question that they want to answer.
eMarketer reports that online advertising spend has increased from 28.3% in 2015 to 38.4% in 2017, and is projected to hit 44.9% by 2020, far surpassing television advertising. So with all that money on the table, businesses want to make sure what they’re buying is reaching the right people and increasing their bottom line.
While some customers may be curious or even leery about AI, this technology is actually benefiting the customers by being able to tap into their preferences. The customer’s experience improves by being served ads that are applicable to them, versus ads that seem spammy and irrelevant.
A study by the Digital Advertising Alliance shows that customers have significantly better experiences with brands who have ads that seem relevant. And customer experience leads to repeat customers, which, again, leads to more cash flow.
Still not convinced?
Take a look at Amazon, an e-commerce powerhouse that you’ve likely visited a time or two. Amazon gets the “gold star” for leveraging AI to improve customer experience. Ever get to the checkout area and end up adding an item to your cart that you weren’t planning on purchasing? It’s likely thanks to their “people who bought this also bought that” function. This tool utilizes AI to hone in on customer preferences and show products that are most applicable to them, resulting in additional spends.
Regardless of your stance on AI, there’s no doubt that this technology is here to stay, and we’re only seeing the beginning stages of what it can do. If you’re in the marketing space, implementing AI into your strategy is no longer a “nice to have” tool, but necessary for survival.
About the Author: Christopher Day is an Entrepreneur, Co-Founder, and CEO in numerous technology startups, leading to acquisitions by Fortune 100 companies including Comcast, Time Warner, and Motorola.
About DemandJump: DemandJump enables companies to improve their online marketing investments with unprecedented purpose and precision. The company’s award-winning Traffic Clout™ platform uses complex math theories (artificial intelligence) to analyze a customer’s competitive digital ecosystem and deliver results.