How AI is Changing the Way Brand Marketers Reach New Customers

Artificial Intelligence (AI) is the mother of all marketing buzzwords these days. 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 much bigger than using a machine to order your food vs. having a waitress come to your table. AI is about gathering information fast. Really fast. At a rate that would be unfathomable for a human to collect in such a short time frame. Marketers make up a large sector of professionals who are taking advantage of AI to solve business challenges

So how does AI fit into the world of marketing? Let’s take a look at Stitch Fix, an online subscription and personal shopping service. Stitch Fix uses AI to improve clothing predictions. It does so through the use of hundreds of algorithms created by data scientists. One of those algorithms 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. Stitch Fix is currently sitting at $730 million in revenue, so it's doing something right.

AI helps retailers serve a more personalized message to target customers. It’s not only showing customers relevant products and deals, it’s also delivering these messages in a style that's preferable to the user. This technology can deliver answers in real time as marketers pursue customers, telling them who to target, what products to place in front of them, where to place these products, 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.

With AI, marketers are now able to understand linkages and patterns, allowing them to predict what consumers 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. eMarketer reports that online advertising spend has increased from 28.3 percent in 2015 to 38.4 percent in 2017, and is projected to hit 44.9 percent by 2020, far surpassing television advertising. So with all that money on the table, businesses want to make sure what they’re buying is working.

While misconceptions about AI tend to make some consumers nervous, they’re actually benefiting from its ability to tap into their preferences. The consumer’s experience improves by being served ads that are applicable to them vs. ads that seem spammy. A study by the Digital Advertising Alliance shows that consumers have significantly better experiences with brands which have ads that seem relevant.

Still not convinced? Take a look at Amazon.com, 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 add an item to your cart that you weren’t planning on purchasing? It’s likely thanks to Amazon's “people who bought this also bought that” function. This tool uses AI to hone in on customer preferences and show products that are most applicable to them, resulting in additional spends.

So whether you’re on the AI bandwagon or not, the fact is that it’s not going anywhere. If you’re in the marketing arena, you need to crack open that little black book that AI is providing and start changing your strategy.

Christopher Day is the co-founder and CEO of DemandJump, an artificial intelligence (AI) marketing platform.