Artificial intelligence is changing the marketing landscape. Customer interaction is becoming more personal with the aid of AI and machine learning. Increasingly, the Internet of Things (IoT) is also instrumental in this movement. The impact of AI in marketing can influence anything – from day-to-day decisions like choosing a specific milk brand for a lactose-intolerant gut, to bigger ones like a holiday destination.
Artificial Intelligence and Marketing
AI has been disrupting industries and will continue to do so. The early adopters like healthcare, manufacturing, automobile, and finance have already incorporated artificial intelligence into their systems. Healthcare providers now use virtual assistants, AI-assisted robotic surgery and computer algorithms for diagnosis. AI has also touched asset management, supply chain and inventory management in manufacturing industries.
The automobile’s foray into the driverless car revolution has been advancing at an unprecedented rate. Lastly, the finance sector use AI to improve fraud detection, trading and customer interface.
In marketing, the low-hanging fruits for automation are psychography, mass promotion, and customer interaction. Artificial intelligence has touched the following aspects in some way.
Marketing is an industry that is highly reliant on consumers. It can help to turn around a dying business model. Understanding the behavior, attitudes, and values of the consumer can be helpful in determining how a specific target group will react to a particular product or service. This is where AI in marketing and psychography intersect. Psychography is defined as a qualitative methodology used to describe consumers on psychological attributes. It is the study of personality, values, opinions, attitudes, interests, and lifestyles of people. Machine learning profiles consumers based on their digital footprints and online activities. Marketers are able to build a complete and in-depth profile of their target markets using the information obtained by combining psychography and demography. This translates to more targeted promotional efforts, emotionally-appealing advertisements and higher yield from leads.
A few decades ago, city-dwellers read an average of 2,000 ad messages per day. While 2,000 ads already sound a lot, this still is sparse compared to 5,000 or so daily ads that we receive these days. Our brain can only take a limited amount of information. With our daily lives hyper-saturated by mass advertisements and automated promotion, our brain has learned to cope by ignoring most of these stimuli. The consumers’ deliberate “blindness” to en mass marketing is making mass promotion less effective. AI in marketing is personalizing mass promotion in order to increase conversions. Using computer algorithms, marketers will determine when will be the best time to send that email offer or what time of day their product banner will appear on your social media feed. With AI, marketers know when you are most likely to notice their ads.
Interacting with a customer is an integral part of marketing and overall consumer experience. The point of contact should be intuitive and responsive. Companies are investing heavily in artificial intelligence and natural language processing (NLP) technologies in order to provide customers a seamless interface. Additionally, Artificial Intelligence and NLP also serve as a tool to reinforce the company’s value proposition to the customer. Additionally, these communication channels are gathering more data about the consumers. Chatbots and automated response systems are primary examples of these technologies. It offers immediate customer assistance done in a human-like interaction. Likewise, marketers are using social media to interact with their customers. According to a study conducted by Bain and Company, companies engaging with customers via social media receive 20% to 40% increased customer spending.
The Future of AI in Marketing
The four Ps of marketing, also known as the “Marketing Mix”– Product, Price, Promotion, Place, have undergone a number of transformations since its inception in the 1940s. As the market changes and the consumer behavior evolves, companies and marketing professionals learned to change with the times.
With the advent of Digitalization, Internet of Things and Artificial intelligence, marketing is undergoing another transformation phase. Here are a few more developments that can influence the future of marketing:
- Marketers have learned to utilize text searches using SEO. However, the voice-enabled search is an untapped resource for data mining and marketing. The increasing use of voice search will eventually force companies and marketers to revisit their SEO strategies.
- Smart Devices will help marketers further know their consumer base and create a more targeted marketing strategy. A smart fridge manufacturer, for instance, can be tapped by a consumer company to advertise their product.
- Consumer-dictated AI in Marketing will be more prevalent. Getting viral on social media or being turned into a meme is the consumers’ way of saying what captures their attention. Marketers should be on the lookout for these movements in order to get a pulse of what the consumer really wants.
- Societal changes and cultural shifts will also play a pivotal role in the future of AI in marketing. Hashtags and social media backlash has forced companies to reassess marketing strategies in the past. This will continue in the future
AI in Marketing, Fear or Embrace
We can either fear or dismiss artificial intelligence in marketing as just another fad. But doing so are the worst reactions we can surmise. Luckily, the industry has been using AI in marketing as a tool to further understand the needs of the consumers. With digitalization, Internet of Things and artificial intelligence in marketing, marketers are beginning to listen to the customer speak.