AI Marketing: What, Why and How to use Artificial Intelligence in Marketing

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Jade Updated: April 01, 2021

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It’s no surprise that Artificial Intelligence (AI) is leading the way in almost every industry it is adopted. The latest statistics show that current AI technology can boost business productivity by up to 40%.

Amid the rapid dissemination of new technologies recently, a lot of market leaders have been stimulated to step up in a more advanced and efficient area, in which AI has solidified itself as the most powerful weapon.

Clearly, businesses that have AI under their power will have more chances to stay ahead in the competition in many different ways. In fact, more and more are investing in AI marketing - a great adoption to revolutionize the way we do marketing.

Get up speed on Artificial Intelligence and learn how it can help you drive business value with successful and innovative AI-powered marketing strategies.

This article gets you through everything you need to know about Artificial Intelligence that helps everyone involved in marketing perform their jobs exponentially better than it could be.

Let’s get started!

Table of Contents

What is AI Marketing?

We should first clarify what Artificial Intelligence (AI) is exactly?

AI is an interdisciplinary science with multiple approaches. Maybe that’s why you can see a lot of answers to the question “What is Artificial Intelligence?” So much so, there is no singular definition of AI that is universally accepted.

At its core, Artificial Intelligence is a constellation of many different technologies that are capable of performing tasks requiring human intelligence. When applied to the usual business tasks, these technologies can learn, act, and perform with human-like levels of intelligence. It is used to simulate human intelligence in machines, saving us a lot of time and money in doing business.

Historically, four different approaches have been explored to Ai are:

  • Think humanly
  • Think rationally
  • Act humanely
  • Act rationally

According to the United States Patent and Trademark Office (USPTO), technologies that belong to the AI landscape include machine learning, knowledge processing, AI hardware, natural language processing, evolutionary computation, computer vision, speech recognition, and planning/control.

(AI terms that you should make clear yourself: Learn more!)

Artificial Intelligence Marketing (AI marketing) is now one of the most evolving topics in today’s digital era.

So what exactly is AI marketing?

Simply put, AI marketing is a method of leveraging intelligence technologies to collect data, customer insights, anticipate customers’ next moves, and make automated decisions that impact marketing efforts. In marketing, AI is usually used in which speed is essential. AI, actually, can boost the return of investment (ROI) of marketing.

With AI, marketers can understand their customers’ behaviors deeply, know their actions and indications. Therefore, they can target the right strategy to the right person in a time-saving and effective way.

A quick example of using AI in marketing comes from Gmail and Google Docs that use AI in Smart Compose to read what you are typing, then understand it and suggest what to type next. I will also compile some examples of AI marketing use cases from big brands in the following section. It would be fun to see what others are doing with this powerful technology, so keep reading!

Now you will need to know why AI marketing is vital for your business.

Why is AI Marketing important?

The impact of artificial intelligence in digital marketing is huge. If you don’t know, 76% of customers expect companies to understand their needs and expectations. AI marketing allows marketers to crunch a huge amount of marketing data analytics from social media, emails, and the Web in a relatively faster time. That’s why AI marketing is a must for every business.

Let’s dive in more details about the benefits of AI marketing:

Automation

AI makes your marketing automation more intelligent. It can work with marketing automation to enable translating data into decisions, meaningful interactions and positively impact your business outcomes.

Everything is about data, but what matters more is quickly and accurately turning data into actionable insights. In other words, the speed with which the marketing tasks are executed and implemented is a critical element that AI marketing can bring to your business. AI can help marketers scale the number of campaigns they create, determine the next best actions for customers, and then define which campaign to send to them properly.

AI in email marketing automation is somewhat of a dinosaur that businesses can use to increase customer engagement and the email open rate while saving. In particular, AI goes one step ahead of a copywriter by optimizing subject lines for clicks and tracking their performance.

AI can also generate and optimize content in multiple email formats that are friendly and relevant to receivers.

Minimizing errors

Humans are naturally prone to making mistakes. AI and human error - a broadly-discussed topic that many have come to an argument over whether AI can be a remedy for human error?

Unquestionably, Artificial Intelligence exists to avoid human intervention that eliminates the likelihood of human error. Provenly, AI can help with human errors, especially in the most concerning aspect: data security.

The common data security problems make many businesses worry about the lack of ability of their employees to safeguard customer data and other critical data of the business. The cyber-attacks increase is the risk that every eCommerce business has to weigh. Fortunately, AI can help address these problems by learning, adapting, and reacting to the cybersecurity a business needs.

Cost savings

AI can help you eliminate many slash-and-burn resources usually used to create and employ a marketing strategy. With AI, you can achieve a significant cost reduction by working more quickly and efficiently, increasing your revenue.

When your organization is spending too much money and hours to get things done, AI can help you complete repetitive and mundane tasks. It shortens the time that those tasks are originally done by your staff while reducing the errors to zero. The costs for hiring employees can be slashing significantly while taking advantage of available talents to do more critical tasks.

With AI, you can work more efficiently.

For example, a content manager can use AI to perform thousands of copy and creative variations of the A/B tests and construct email subject lines automatically, speeding up the process and performing even better than humans.

Increased ROI

AI helps marketers better understand customers and improve customer experiences. AI-powered marketing enables marketers to create a predictive customer analysis and design customer journey more targeted and individually tailored, which effectively increases ROI on each customer contact.

Through AI, marketers can gain greater customer insights and know better how to group them, and drive them to the next step to bring in the best experience on their journey.

By deeply analyzing customer insights and understanding what they actually want, marketers can maximize ROI without wasting budgets on efforts with no effects. They can also avoid dwelling on mind-numbing campaigns that annoy customers.

Increased personalization

We have heard a lot about personalization across shopping in the digital world. That’s what customers increasingly stick out for when it comes to online shopping.

So what’s the secret to better personalization eCommerce businesses can use to win customers’ hearts?

The answer is Artificial Intelligence (AI).

Artificial Intelligence will make your marketing more personalized in many different ways. Many companies are already using AI to personalize their websites, emails, social media posts, video, and other content to address better what customers want.

For instance, eCommerce business doers are getting more positive results by making push notifications mobile-friendly. When done well, push notifications delivered via mobile gain more attention from customers because it creates a sense of personalization.

That’s because each individual customer will receive their own personalized push notifications with the custom-tailored messages based on what they’ve viewed or exactly what they want to hear from a brand.

Product recommendations are also an incredible AI marketing practice that makes the customer experience more personalized than many marketers ever thought possible.

8 Customer Segmentation tips to personalized eCommerce marketing. Learn more!

Smarter and faster decision making

AI helps conduct data much faster than human intervention, guarantees the accuracy, security, and enables your team to focus on strategic initiatives to make effective AI-powered campaigns.

AI is able to collect and track real-time tactical data so that marketers can make decisions right at the moment without having to wait until the campaigns end. They can determine what to do next based on the data-driven reports so that the decisions will be smarter and more objective.

How to use AI in Marketing?

Sales forecasting

Knowing what to do next and doing it right is what every business should aim to meet customers’ expectations and earn more sales. The application of AI in marketing makes it easier for marketers to understand customers and participate in their actions based on the data collected on their contacts and past purchases.

Through this system, you can predict what customers will buy next and the quantity of a product sold. It helps you define what product to promote and promote to whom to drive higher sales. This way of creating business intelligence also enables you to avoid overselling or selling out-of-stock products by balancing your inventory.

An example of software that uses AI to aid marketing reps is Qurious. The software helps your marketing or sales reps understand every conversation with prospects instantly without paying outrageous amounts of speech-to-text costs.

Get AI-powered customer insights

The main reason businesses use AI is for data collection.

The insights that AI collects for businesses are valuable sources for them to understand customers at their best and make customer-centered decisions. AI enables external market knowledge by analyzing the vast amount of online content on social media platforms, blogs, or other platforms.

Marketers can easily create customer personas based on billions of data collected from AI algorithms. They are on-site interactions, geographic specials, purchase behaviors, past interactions/communications, referral sources, and more.

From then, customer segmentation can be done more effectively. Marketers can identify more clearly which customers should be targeted and included or excluded from the campaign, better match customers to the products they’re likely to buy, and prevent promoting irrelevant or out-of-stock products to customers.

Craft personalized customer experience

Brands can use AI to improve customer experience by offering personalized content and offers and top-notch support to each individual customer.

Think about the last time you visited an online store. You see a page with products you may enjoy and features selections exactly what you are going to buy. AI is used to analyze the products you’ve purchased in the past and recommends products that fit your needs. This is an example of how AI improves customer experience with personalization.

The result of a personalization campaign using AI is more sales, engagement, and customer retention.

Content Generation

AI-powered tools can help the works of content creators much more efficiently and easily.

Though the core of the content is routed from human creativity, you can use AI tools to maximize your content team’s efficiency by automating specific tasks such as email content, personalized reports/messages, or social media content curation.

Some tools like Rocco can help you create fresh social media content that increases your followers’ engagement.

AI-enhanced PPC advertising

AI is also used widely in PPC advertising. According to GoodFirms, researches showed intriguing findings of the application of Artificial Intelligence in PPC (pay-per-click advertising) from PPC gurus.

In particular, some top of AI applications in PPC are:

  • Smart bidding
  • Micro-moment targeting
  • Responsive ads
  • Performance analysis
  • Dynamic search ads
  • Price optimization
  • Account management

Using AI, you can be able to monitor more advertising platforms that can’t be achieved by your in-house teams and, perhaps, your competitors.

Chatbots

You might have at least once chatted with a bot in an online store, from their Live Chat on the website, or through social media, especially Facebook Messenger. This is how AI is applied to build better customer service.

Besides responding to the repetitive questions from customers - those questions related to price, size, or quantity, AI is used at its best to create personalized and tailored content that might be more efficient than humans.

MobileMonkey’s chatbot
MobileMonkey’s chatbot

Also, It would be best to combine AI chatbots with personalized content marketing to turn them into proactive advertisers, not just used for direct customer acquisition.

May in your interest: Top 10 Best AI Chatbot for enterprise customer service.

Speech Recognition

Speech Recognition

Want to feel how it is to have Jarvis from the Marvel movie “Iron Man”? Well, Jarvis is possibly still years ahead of technology today, but that doesn’t mean it won’t happen.

Currently, we already have similar AIs with speech recognition capabilities. Ever heard of Siri, Google Assistant, or Alexa? These are just some of the most popular chatbots that use speech recognition.

These AIs can recognize spoken words and/or convert them into the text to execute the command. Speech recognition is even used in apps such as Google Maps, Shazam, and other hands-free systems.

So how can marketers take advantage of speech recognition for their campaigns? Well, >55% of households will have a smart speaker by 2022 from just 13% in 2018. Moreover, sales from voice shopping are expected to jump to USD 40 billion in 2022, up from just USD2-billion in 2018. If the data are to be believed, this speaks (pun intended) volumes, in terms of the need to use speech recognition in your marketing campaign.

Dynamic Pricing

Dynamic Pricing

This AI is often referred to as personalized pricing. It’s a pricing strategy wherein a product’s price is determined by demand and/or supply. A good example is the prices of ride-sharing apps that increase as demand rises or when you can’t find a discount when you need to purchase a product online.

An application’s or website’s bot can monitor your predictive analytics use cases such as cookies, history, searches, and other activities, to provide you with real-time pricing. This means you get fewer discounts and/or higher prices for the product/service you need at the moment. It sounds unfair, doesn’t it? But there are always two sides to a story.

Customers can benefit from dynamic pricing when the demand for a product is down. A good example of this is when hotel rooms go unsold. To help decrease the chances of a vacancy, dynamic pricing can offer competitive pricing to attract customers.

Automated email content curation

Content curation is about finding great content and presenting it to your audience in an effective way. Simply, you share content created by others with your followers.

However, it’s not just re-sharing content; this process is done by adding more values to your content that’s more likely to engage your audience.

With Artificial Intelligence, you can curate content and put it into action on the fly. The automation will save you time scheduling and sending emails to customers. After segmenting your audience and their emails, AI helps you personalize your newsletter’s content sent to each of your audiences. Your newsletters need to be more relevant from what you say to the links your audience will click.

Automated image recognition

Big brands like Google, Facebook, Pinterest, and Amazon use AI to identify people and objects in images and videos with an accuracy percent up to 99.75%.

If you are a Facebook user, you may notice how exact the system has become at recognizing your friends’ faces in the photos you post and automatically tag them.

From a marketing perspective, image recognition can better syn the online content and store visits. Many stores trace customers’ in-store visits through facial recognition software and link to their profile to serve them with a better online shopping experience. Some others combine this technology with AI-managed push notifications to send real-time offers, discounts, and personalized messages to customers individually. This increases the interactions between stores and customers as well as keeps their excitement longer when staying in the store.

Ensure data quality and privacy

Once fully and correctly implemented, AI can improve the data quality and privacy of an organization. Usually, marketers will need a vast amount of data at their disposal. Therefore, to leverage Artificial Intelligence solutions, it’s crucial to have quality data in a place that is suitable for AI to perform its job.

Think of using a modern data warehouse and deploy all-in-one data management software to avoid data quality issues caused by complicated data management.

AI provides you with better data acquisition and prevents this rich source of information from being harmed by cyber attacks.

Examples of AI in Marketing

1. Nike - Personalized online experiences

Nike creates personalized experiences for customers by using artificial intelligence. The technology enables Nike’s website to recommend products that uniquely suit customers. It also enables customers to search for products using conversational language, images without interacting with a person.

Nike uses AI thoroughly to personalize the customer journey, which is a huge value-add to their business.

Nike’s Product Recommendation
Nike’s Product Recommendation

2. Amazon - Personalized shopping recommendations

Amazon has set the standard for product recommendations and continues to be the leader in the eCommerce marketplace today.

Amazon’s product recommendations feature provides customers with a more personalized and enjoyable shopping experience. Research shows that 53% of shoppers say they always do research before buying a product to make sure that they are making the best possible purchase. That’s why product recommendations will be a great help for customers to find what they are looking for.

Whether the recommendations are based on customers’ historical purchases or just similar products at different pricing points, it’s effective to educate customers and empower them to make the purchase decision much easier.

Besides, Amazon also designed a pricing strategy to excel in the modern and ever-changing market. Amazon’s dynamic pricing is a great success. Instead of overwhelming customers with the rapid changes in prices, the company leverages this strategy to adjust its prices at the same rapid pace of the market demand. This helps Amazon stay ahead of the competition and grab the first-mover advantage to offer customers compelling products’ prices before their rivals take any action.

Amazon’s Product Recommendation
Amazon’s Product Recommendation

3. Alibaba - FashionAI store

Alibaba brings AI to fashion to improve the fashion retail experience by opening a physical FashionAI store in Hong Kong. This use of Artificial Intelligence effectively simplifies the apparel shopping experience and gains more customers’ interest.

Alibaba’s FashionAI store uses 3 key features to streamline the fashion retail experience for customers:

  • Smart lock to capture customers’ preference: Products in this store have special tracking tags containing radio-frequency identification, gyro-sensors, low-energy Bluetooth chips. Each garment will carry specialized information about the item it’s attached to. The amazing gyro-sensor will empower the tag to decide which items can be touched and which one is not.

  • Smart mirrors: The store’s mirrors are located on the sales floor and in changing rooms with intelligent touch screens. It displays the information about the items customers are interacting with thanks to the intelligent locks equipped with each product. Smart mirrors can also recommend other apparel to complement the items customers are currently browsing.

  • New fitting experience: This concept enables customers to quickly get the best look at what they wear by adding suggested garments and accessories brought to them by the store’s staff after they try out an item. FashionAI also carries increased omnichannel capability with a “Virtual Wardrobe” on its mobile Taobao app. This feature allows customers to view the clothes they are trying on along with other recommended items that would complement their outfits.

Alibaba’s FashionAI store in Hong Kong 2018
Alibaba’s FashionAI store in Hong Kong 2018

4. BMW - Intelligent Personal Assistant

Besides the technology to learn about the driver and adjust the system and cabin experience to best fit each individual, BMW’s AI-enhanced sports cars are also equipped with an intelligent personal assistant. This personal assistant enables various vehicle functions such as Climate control, Lights, Media, and settings like Caring car, Experience Modes, etc.

This amazing assistant allows drivers to communicate with their cars like they do with smartphones. It is a voiced-activated manual that can anticipate travel routes to simplify the destination input, alert the drivers, and integrate with other apps.

5. Starbucks - Reward Program/Mobile App

Starbucks captures its prospects’ data through the use of AI in Rewards Program and Mobile App.

In fact, Starbucks has successfully built its relationships with customers through this Rewards Program. For example, the company gives its customers free coffee on their birthdays. Via its mobile app, customers can talk with the barista via voice assistance to order their coffee.

Through this AI-powered tool, Starbucks acquires your buying history and gives you tastes they know you will enjoy after considering the date of purchase, the time of order, and the location.

Source: Bold business
Source: Bold business

Can AI replace marketers? How can they work in tandem?

At the end of the day, marketing decisions come from human beings. AI can help marketers accomplish and improve what they are doing and what to do next, but it can’t replace them entirely.

Unquestionably, AI helps marketers fulfill their dream to do marketing in a personalized and meaningful way.

To achieve success in AI marketing, there are some considerations for marketers:

  • Ensure your data is sufficient for the AI algorithms to learn from and analyze accurately.
  • Never leave it all for tools when it comes to personalization. The content needs to be natural to users.
  • Define where AI can make the biggest impact and bring on the highest ROI for your business.

If you are on the hunt for AI marketing vendors, consider choosing those that can help you make the right decisions for your campaigns.

A final thought

Artificial Intelligence has made leaps and bounds since a long time ago, and it already shapes the future of marketing. It’s up to you to implement this technology in your business. But one thing for sure is that AI is the future. If you plan on running a successful online business in the coming years, using AI-powered marketing and tools is a must.

Thanks for reading! If you find this article interesting, please give it a share.

You can also visit the guide of how to optimize your marketing campaigns below!

Marketing Solutions

Author Bio:

Kimberly Grimms: I am a futurist who spends most of my time monitoring social behavior in search of new consumer trends. I use the information to create viral and useful content as part of the new media strategy. I’m interested in technology, market behavior, new media, environment, sustainability, futuristic scenarios, and businesses.

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Jade
Jade
Jade is a content creator, book lovers, and a hodophile. She loves to learn skills and practical knowledge to excel at marketing, especially content marketing.

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