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How Artificial Intelligence Affects Digital Marketing

Alekh Verma | February 24, 2023
AI

Artificial Intelligence (AI) still sounds a bit sci-fi and futuristic to most people. And yet, it’s part of our everyday life and as ordinary as asking Alexa to volume-down the music.

AI has been evolving rapidly in the past decade and as a result, it is finally getting advanced enough to have a tangible impact on many areas of the economy. It’s affecting the way people do business and has grown to be an indispensable part of many industries, such as healthcare, automotive, technology, communications, and financial services. And it has brought along some big changes in marketing as well.

The basic purpose of AI in marketing has so far been to automate mundane processes. But as it is getting more advanced and accessible, it opens doors to a world of opportunities.

Using AI we can gather and organize large amounts of data, and analyse it, and then provide sophisticated marketing predictions and personalized strategies based upon them.

One of the main problems marketers face today is that managing big-scale data and making sense of it requires enormous resources and is time-consuming. With the markets quickly changing, by the time an analyst can process all the data and make sense of it, it’s already outdated and only has statistical value.

However, what might take a human, months to accomplish, a machine can do in hours. That’s what makes AI so efficient. Using technology like machine learning, deep learning, and natural speech processing, AI is becoming more capable of reading and understanding humans. And connecting the dots between technology and humanity can be the basis of profound personalization of user experience.

Artificial Intelligence Marketing At A Glance

AI marketing is a method of leveraging technology to improve the customer journey. It can also be used to boost the return on investment (ROI) of marketing campaigns. This is accomplished by using big data analytics, machine learning, and other processes to gain insight into your target audience. With these insights, you can create more effective customer touch points. Whether you're engaging in email marketing or providing customer support, AI eliminates much of the guesswork involved in customer interactions.

On a grander scale, it can be used to automate processes that were once dependent on humans. Content generation, PPC ads, and even web design are all possible applications for AI marketing. Right now, our agency primarily uses AI to help with our video marketing efforts.

AI And Digital Marketing

In the world of digital marketing, AI can streamline and optimize marketing campaigns. It can also eliminate the risk of human error. While much of the digital marketing world is still dependent on human ingenuity, an AI program might be able to generate a report using nothing but data. However, to truly connect with your customers, you'll still need the human touch.

Empathy, compassion and storytelling are all attributes that machines can't emulate, at least not yet. At the end of the day, AI is not bound by human limitations. If Moore's Law holds steady for a while, there's no telling what AI will be able to do in the near future.

In the meantime, here are some of the innovations that could affect the industry as AI marketing enters the mainstream.

Content Curation And Generation

At present, content marketing has ballooned into a global industry. It's so prevalent that some refer to it as the only type of marketing.

AI has the potential to both curate and generate content, then place it in front of the right people on the right platforms. This technology is already automating content generation on a basic level, but eventually, AI could generate viable topics for writers, or even develop initial drafts of content based on certain parameters.

On the strategy side, AI has the potential to help marketers map out an end-to-end content strategy. Some marketing tools are already providing this feature. I predict it will also be able to generate comprehensive reporting on content initiatives, with little to no human labor involved.

AI-Enhanced Digital Advertising

I believe artificial intelligence will also continue to change the way businesses advertise. In fact, today's digital advertising strategies would be impossible without a rudimentary form of AI. Even electronic billboards can be powered by AI-based delivery systems.

These systems operate autonomously, placing the right kinds of ads in front of the right kinds of people based on complex algorithms and big data. This is what's known as "programmatic advertising."

Not too long ago, ad development was mostly a creative endeavor. It still is, but businesses must look beyond creativity if they want their ads to be effective. Today, it's all about targeting and delivering the right message.

Consumers and business to business (B2B) buyers are overwhelmed every day with advertisements. Most of them are irrelevant, so they simply close the ad or move on to their next task. When this happens, advertisers lose money.

With AI, businesses can optimize their return on investment by only placing ads in front of relevant viewers. Ads can be bought automatically, then personalized at scale. Many advertisers are already using this technology.

Sounds amazing, right? But there is more good news. Supply keeps up with the demand and AI is becoming more affordable to even smaller businesses. So read on to find out what AI can do for your marketing team in 2021 and beyond.

1.  Affordable AI Solutions

Building a personalized AI from scratch to serve your business’s needs is tremendously expensive and possible to afford by only the biggest companies out there.

However, as technology is advancing and demand is growing, there are multiple companies around the world working on various AI solutions. There is a growing market of tools developed to enable businesses to cope with different tasks and problems.

In fact, the market for these is growing like crazy and it’s expected that it can contribute up to $15.7 trillion to the global economy by 2030.

Tech giants like Amazon, Google, and Microsoft have also built easy-to-use AI solutions that require no coding skills and can be applied to various apps for different purposes. And many other tech companies are working on providing simple to use and affordable tools.

Although it might all sound awesome and exciting, do keep in mind that managing AI tools still requires a certain level of expertise.

Adopting AI in your marketing operations requires hiring or training experts who know how to operate the technology. Careless management of data or design flaws in algorithms can lead to bias or false results, thus creating major problems that can lead to losing clients and revenue. The human factor remains a vital part of managing AI and should not be underestimated.

That said, let’s focus on some of the benefits of affordable AI solutions. 

2.  Improved Productivity

Using AI solutions in your marketing operation can increase the productivity of your team immensely. You can start with simply automating processes to free up time and lift the load off your employees.

What’s more, AI tools have the potential to improve the quality and value of your products. By reducing the stress of people getting overwhelmed or overworked, they can help to eliminate the weak points in your marketing process. This way mistakes that people make simply because they are tired, such as overlooking details, for example, will be minimized.

More advanced solutions can increase productivity in multiple ways. For example, they can give your team a jump-start by quickly obtaining and analysing information that would otherwise cost them weeks to process. They can provide insight into customer behaviour, calculate life-time value, and take into account other factors to help you make better decisions.

Adopting AI solutions can help you not only save time but focus your efforts on the right customers and strategies, and minimize distractions. 

3.  A More Holistic Approach to Marketing

Intelligent computers cannot replace a human’s understanding of doing business. But they can make work so much easier for us. AI can show us the bigger picture of economic events, customer habits, and business goals, then process and analyse it, combining all aspects and variables into a map for a successful marketing strategy.

Imagine going through customer data manually to learn details about every single person who’s shopping in your eCommerce store, for example. Or sending thousands of personalized emails one by one to customers.Or checking each client’s history of interactions with your business to provide the best product suggestions.

Now imagine doing it at scale but still managing to keep it personal. It used to be next to impossible.

AI tools can provide and process large amounts of data from different channels across your departments and deliver comprehensible results. This allows you to take a step back and study your business as a whole, improve the collaboration between teams, and build a more coherent image of your brand.

A holistic marketing strategy coordinated across your departments and teams can give you the power to minimize discrepancies caused by miscommunication and optimize your affairs. 

4.  Better Personalization

If there is something digital marketing has been missing in the past years it’s that it has not grown to be personal enough.

Businesses target hundreds and thousands of potential prospects for every campaign. Addressing them with a personalized message, a fitting offer, and perfect timing is simply impossible without the help of AI and automation. 

Understanding Customers 

Being treated with a mass-production approach is far from what people nowadays enjoy. It’s practically impossible to satisfy the customer needs and desires for a personal approach relying solely on dedicated salespeople and marketers.

An AI can build an ID profile for each and every customer of your business even if they are in the millions. The information on this profile can be analysed and an algorithm implemented to build precise predictive models of future behaviour, thus making to-the-point product suggestions.

For example, if a customer is purchasing pregnancy clothes at your eCommerce store, in a few months the algorithm will suggest baby clothes and toys. Based on the customer’s choices, the next suggestions will be about clothes for boys or girls, and etc.

Accurate product suggestions at the right moment don’t only mean more sales and a boost in revenue, but deepening the connection between brands and customers. 

Dynamic Pricing

AI can collect various pieces of customer data, information about competitor prices, and other factors to develop and implement various dynamic pricing strategies. This allows you to target your customers with the right price or promotion at the right time and increase the probability of making a sale.

The algorithm can be set to include different factors depending on the strategies you normally follow or it can be used to develop new approaches based on the new data it acquires. 

Intelligent Ads Budget Distribution

Knowing your customers and having a deeper understanding of their needs and habits can help you compose the perfect ads to grab their attention.

AI algorithms using machine learning allow you to optimize funds on pay-per-click ads. They analyse data across multiple platforms and search engines and help you to distribute resources accordingly.

This can reduce the time your team spends on ads-platforms research and minimize the resources invested in poorly performing ads. 

5.  Agility and Real-Time Reactions

Marketers nowadays need to be able to successfully navigate the changes in the rapidly evolving marketplace. Developing an agile strategy is vital if a business is to be prepared for shifting customer behaviour and new trends.

Changes, however, rarely occur from nowhere and can be foreseen through accurate analysis of past and current factors.

There are AI tools that employ various algorithms to cross-reference company data with customer behaviour patterns and economic factors, analysing the results to provide accurate predictive models. The algorithm can process your product information, past performance of marketing channels, and customer profiles and behaviour, and then put them together with the data curve of consumer habits in your industry, and other economic factors. A predictive model built using this information can help you prepare an elaborate plan for the next period and make several strategies that can be used in different turns of events.

What’s more, being prepared for the future is the first step of enabling your team to respond to events in real-time. As the market nowadays is constantly changing and evolving, to be agile and change your approach in real-time can make all the difference to your business’s success.

Another benefit of predictive analytics is that it allows you to do more sophisticated dynamic prospecting. The algorithm combines product information with user information that is available online to help you target new customers and get them interested in your business. Successfully doing so can increase conversions and introduce your brand to a new audience of viable customers. 

6.  Data Cravings to Satisfy the AI’s Needs

AI requires large amounts of data to be able to deliver accurate and relevant results. Without the necessary resources to feed into the algorithms, they can be biased and fail to satisfy expectations.

The data you already have generated from your omnichannel strategy might be enough to overwhelm your team, but it is just a spec of information for a computer to process. The more data you provide the better AI solutions will perform.

Building a large database of first-party information will allow you to employ the full potential of AI and will also give you a head start. Consider adopting technologies such as site-wide tagging, ID solutions, or a CRM system, to generate quality first-party data from your customer.

Even if you are starting small, there is good news. By increasing the productivity of team members and improving the personalization of services, AI tools will boost conversions and attract more customers. The more customers you have, the more data will be fed into your AI tools and the better results they will provide. Which will lead to even more customers and more data to keep you in the loop. 

7.  Privacy Concerns

With the demand for large amounts of data, however, come some privacy concerns.

The General Data Protection Regulation (GDPR) active in Europe, and the California Consumer Privacy Act (CCPA) in the USA, protect the privacy rights of online users in these areas. To comply with them, businesses have to be careful about collecting user information and are obliged to ask for user consent whenever gathering cookies or other data.

The same regulations apply to AI tools and solutions and should be followed very strictly.

AI tools designed for social listening, and data and opinion mining, for example, appear to be very useful and a tempting source of information, but might easily be considered an invasion of privacy by many users. Although they are not illegal and do not cross any laws or regulations, they still seem to be a grey area ethic-wise.

Such tools monitor user behaviour, speech, and habits online and especially on social media. They use algorithms to analyse this data to understand users, their feelings towards events and brands, and allow companies to make decisions based on the information.

However, with AI growing more powerful and sophisticated, tapping into such sensitive and personal user information might begin to cross the line between what’s acceptable and what is not ethical. It’s one thing to join a conversation about your brand on a social media platform and crack a funny joke to lift your customers’ spirits. But a completely different thing to exploit information about a user’s personal life for profits without asking their consent.

To stay on the right side of the law and maintain your brand’s ethics, you should always take into consideration the active regulations in the regions where your prospects and customers are located.

Recap

AI can give a much-needed boost of personalization in digital marketing and increase the productivity of teams immensely.

Automating processes and using AI to analyse complicated data will make everything more efficient and will deliver improved results to businesses. This will enable marketers to gain a better understanding of customer behaviour and an in-depth comprehension of the processes behind sales and conversions.

Are you already using AI solutions in your marketing operation? Share with us in the comments!

Alekh Verma

CEO and Founder at eSearch Logix Technologies!

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