AI Unlocks the Hidden Value for Marketers in 2021
In 2021, marketers have more data at their fingertips than ever before. By applying artificial intelligence (AI) to that data, marketers can yield critical insights to help drive better business results, including reduced customer acquisition costs, improved lifetime spending per customer, and higher revenue across the board. You don’t have to be an experienced data scientist to gain major value from AI. All types of marketers can – and do – use it and benefit. At a high level, AI provides three important insights for marketers:
- Patterns: AI helps identify patterns in huge quantities of data, enabling marketers to discern common customer characteristics and better understand entire consumer segments
- Preferences: AI discovers customer preferences, allowing marketers to deliver optimal content for a given demographic
- Predictions: AI gives insights regarding what might happen next, which marketers can use to guide their campaign activities, such as the next best offer or who will be the next new customer
When applied to rich data sets, AI can uncover previously unseen patterns, preferences and predictions, helping guide marketing efforts and maximize ROI.
Marketers have been analyzing data to better understand customers’ characteristics, web browsing behaviors, and past purchases for a while. However, AI and machine learning (ML) takes analytics and applies it to huge volumes of data in real-time. While humans would be incapable of uncovering certain patterns in large data sets, AI can immediately discern common attributes among consumer segments. These shared attributes can then be scaled by identifying more customers that display similar behaviors.
Here’s a real-world example to illustrate AI’s power: A clothing company, focused on women’s yoga apparel, deployed AI as part of their online campaign targeting. Soon they noticed that the AI was driving more and more budget toward reaching men, based on the audience behavior and patterns it was seeing. As a result, they created a full line of yoga apparel for this new customer segment, doubling revenue in that product segment.
ML also helps identify preferences. Wherever possible, brands and publishers seek consented deterministic data, such as names and email addresses that customers have allowed to be used to deliver more relevant content and advertising. This is the most effective way to ensure the most relevant and therefore valuable online experience. For the vast majority of companies, this data is expensive and time-consuming to acquire and, even with it, the percentage of online traffic that is logged in to websites is often in the single digits.
AI and machine learning can help fill in these gaps and help ensure that the right ads and content reach the right audiences. This improves the online experience for consumers ensures brand budgets aren’t squandered.
AI can create accurate audience models based on variables such as age, sex, location, education, occupation, income and more. it tells marketers what each segment purchases, which brands they like most, and more.
AI and ML can tell marketers what consumers are likely to do in the future. These are actionable insights, guiding marketers to determine the next best offer, next best action, next new customer and more. To make predictions, AI analyzes enormous volumes of past data to identify historical consumer patterns, then looks at the consequence of those trends.
Which actions or conditions resulted in a sale?
Companies can use these insights to prepare for future patterns. Then they can determine how they should change their marketing strategies when those trends are present to optimize business results.
During the first month after the pandemic gripped the US, car dealer and comparison websites saw a sharp drop in visitors.
But the dealer and comparison websites saw traffic unexpectedly rebound after a month. nearly returning to the levels before the pandemic. If car dealers knew that web traffic would recover so quickly, they could have acted on it with effective advertising campaigns.
AI delivers easy insights
AI allows marketers to easily extract meaningful insights from large data sets. With AI and ML incorporated into several marketing and advertising technology platforms, marketers need to grasp AI’s three basic values – patterns, preferences and predictions – to use this technology and boost their businesses.