The Emergence of AI in Marketing: How to Stay Ahead of the Game

If you’re involved in the marketing world, chances are you’ve heard of Artificial Intelligence. However, you might be wondering how AI can benefit your marketing strategy. So let’s chat about all things Artificial Intelligence and how businesses can utilise it in their marketing campaigns.

What is Artificial Intelligence?

Artificial intelligence (AI) is the simulation of human intelligence by machines that are designed and programmed to think like humans and mimic their actions. Artificial intelligence is usually focused on areas such as speech recognition, problem-solving, learning, and planning. 

Artificial intelligence uses machine programming to execute a task and achieve a specific goal and has become more prevalent as the technology improves and grows.

How is Artificial Intelligence used in marketing?

Recent research shows that 50% of interviewed companies have adopted AI in at least one business function, particularly in service operations, product or service development, and marketing and sales. While everyone is caught up in ChatGPT and its easily accessible service available to the wider public, AI at its core is already commonly adopted in many marketing practices that you perhaps may not realise.

Programmatic advertising

Programmatic advertising has adopted the use of AI within its digital advertising space. It provides an efficient, streamlined process for advertisers, publishers, and consumers. Utilising AI in programmatic advertising allows brands to deliver ads that are personalised to the audience’s needs, interests, and situation. Programmatic advertising combines AI and location data to determine the most cost-effective reach for your ads.

This offers many benefits, including increased conversion, engagement, and retention rates.
 

Offering personalised digital experiences

With the integration of AI into digital shopping experiences, brands can offer consumers a more personalised experience. With the help of AI, brands can respond in real-time to what consumers are searching for and offer personalised recommendations. You can see AI at work when you log into Netflix and see a selection of shows and movies that are recommended to you.

Personalisation is an effective marketing technique, with research from Forbes revealing that 40% of marketing executives reported personalisation having a direct impact on maximising sales, basket size, and profits in direct-to-consumer channels such as e-commerce.

Another 37% of marketing executives reported increased sales and customer lifetime value thanks to product or content recommendations.

Helping consumers find products

 With Statista reporting that the number of digital voice assistants will reach 8.4 billion units by 2024, it’s clear that voice search has become an important component of consumers’ digital experience.

Voice search has also become a significant consumer habit, particularly among the younger generations. According to statistics from Accenture, 38% of Gen Z-ers are willing to try shopping via voice-activated ordering.

Offering 24/7 customer service

Chatbots have become incredibly popular in today’s marketing climate because they allow customers to receive 24/7 support with immediate and personalised responses. With the help of complex algorithms, they are even able to match a particular tone of voice which allows for a consistent reputation of the brand.

One of the biggest benefits of chatbots is they are highly cost-effective compared to the cost of a team of employees. Most importantly, chatbots free up staff, allowing them to focus on other tasks and provide an improved customer experience.

The benefits of artificial intelligence in marketing

Reduces error

 Although not completely error-free, AI eliminates human error. Humans are more likely to make errors when tired but with AI, this isn’t an issue. AI also has the capacity to make better decisions without the influence of emotions or opinions.

Does what humans can’t

 Unlike humans, AI doesn’t need downtime or rest, so it can work 24/7 without a reduction in efficiency or success rate. It is also well-suited to performing multiple tasks at once and can complete dangerous tasks such as defusing bombs or going to space.

AI also has the ability to handle mundane or repetitive tasks with more efficiency than a human and helps brands achieve marketing automation.

Provides a better understanding of the audience

The use of AI helps brands to analyse a large amount of data to predict customers’ buying behaviour and decisions. By achieving a more holistic understanding of their customers, brands will be able to create a successful digital transformation strategy.

Better measurement of customer engagement

 AI allows brands to effectively measure customer engagement and determine which strategies are working and which aren’t. AI tools can also compare old and new clients and deliver key information about what each client wants and how to target them.

Overcoming challenges with AI marketing

Lack of data quality

 One of the biggest challenges to implementing AI in marketing is a lack of data quality as AI algorithms rely on high-quality data to make accurate predictions and recommendations. To ensure high-quality data, businesses should invest in data management tools and processes.

Potential copyright infringement

 Due to the fact that AI content marketing platforms all draw from the same database, there is a risk of overlap if businesses just copy and paste without reviewing the content themselves. Similarly, AI-produced content may be flagged by search engines as plagiarising content from other websites.

Resistance to change

 A common fear that employees have is that AI will replace their jobs or disrupt their workflows, making them understandably hesitant to adopt it. To help employees feel more comfortable with AI, businesses must communicate its benefits and provide training and support.

Lack of skilled professionals

 To overcome the issue of a lack of skilled professionals who can design and implement AI, businesses should provide their employees with training and development programs and hire additional employees with AI expertise if necessary.

Case studies of successful AI marketing campaigns

 
Nike’s DIY sneaker system
Last year marked the launch of Nike’s DIY sneaker system which allowed customers to design their own sneakers in-store. This campaign was effective in both driving sales and collecting useful information that could be used by machine learning algorithms to design future products and deliver personalised recommendations and marketing messages.

Amazon’s product recommendations

Amazon’s use of AI allows it to offer personalised shopping recommendations based on many factors including previous purchases and searching and browsing behaviours. Amazon also utilises artificial intelligence to offer dynamic pricing, which involves reducing prices to boost sales when necessary and increasing prices during periods of high demand.

Starbucks loyalty card and mobile app

 Starbucks utilises predictive analytics to process customer data and deliver personalised marketing messages to customers when they’re near local stores and offers that aim to encourage customers to spend more. Customers can also place orders directly from their phone via voice command with the help of an AI-powered virtual barista service. Starbucks also uses data collected from 90 million transactions every week to inform decisions such as locations for new store openings and new products.

The future of AI in marketing

Hyper-personalised marketing

 Artificial Intelligence’s ability to analyse large amounts of data such as past purchases, browsing behaviour and demographics allows companies to target specific audiences and create personalised campaigns.

By taking a data-driven marketing approach, businesses can gain a significant competitive advantage over those who don’t utilise AI.
 

Augmented Reality

 Augmented Reality (AR) allows customers to view products in their home environment before making a purchase. By offering a personalised experience, brands can significantly boost the chances of making a sale.

AR can also help reduce returns and offer a competitive advantage as customers are more likely to engage with a brand that utilises AR. According to Deloitte, 88% of medium-sized businesses are already using or testing AR for customer use.

Fraud detection

 The ability of AI technology to analyse customer data and transaction patterns will allow it to be used to detect and prevent fraud in e-commerce transactions by monitoring for unusual transaction patterns and identifying suspicious IP addresses.

WhatsApp Chatbots

 With over 2 billion active users and an average open rate of 98%, WhatsApp provides a huge opportunity for brands to connect with their customers. WhatsApp Chatbots allow customers to receive quick and personalised responses to their inquiries while effectively reducing customer service costs.

Looking for help on how to navigate the world of digital marketing? Get in touch with our friendly team of specialists to find out how OMDIGI can help.