Marketing today is tough. Customers are diverse and want to not only purchase from multiple channels, but they want to do so simultaneously. Shoppers’ preferences seem mercurial. Many marketers spend most of their time playing catch up, because they don’t have the time or tools to analyze trends and where their businesses are headed. Data can help, but collecting information is just the beginning of creating an engaging marketing strategy.
The promise of collecting big data — both structured and unstructured — is that once analyzed, the information will provide evidence to support a particular business strategy. Information is the key to business success. Knowing the customer is crucial in myriad ways, from understanding, identifying and predicting trends to stocking shelves with just the right mix. Indeed, purchasing inventory depends on knowing who your customers are: grannies or nannies? Frat boys or CEOs?
Big data, with substantial help from artificial intelligence tools, can predict sales, validate trends and find gaps in marketing. For example, you might learn that a significant number of your frat boy customers bring girlfriends shopping to your store, who usually make a small purchase as well. AI can connect the dots in Big Data to understand how consumers think, feel and behave. Patterns and trends can be identified and sales data can predict response rates to advertising.
AI helps retailers understand the customer, so advertising can target specific audiences. That’s where AI can bring the huge benefit and significant sales lift.
A global study — “Closing the Loop on Brand Advertising” — an April 2018 study from LoopMe, found that on average, using AI to “optimize toward brand outcomes like purchase intent, brand consideration, brand favorability or awareness in real-time drives a 6X increase in brand metrics.” Clearly, the brand experience can be much more personalized and predictive through AI. That type of appropriate targeting can pay large dividends.
Take KLM, the Netherlands-based air carrier. The company has implemented AI to improve efficiency in social customer care. The system provides answers to 60,000 customer questions. Right now, only approximately 10% of its answers are sent without any human editing, but that’s expected to increase, because AI accuracy improves as it collects data and monitors customer interactions. Better answers mean fewer frustrated customers.
To drive profitability, companies must be smarter, not necessarily bigger. But in becoming smarter, it becomes more difficult to avoid “the creep factor,” which happens when a retailer uses too much collected information and/or employs too much automation when interacting with customers. That so-called “uncanny valley” occurs when brands push their AI too hard in trying to be human. The result is no one likes you: Having a bot wish you “happy birthday” when you are on a site buying plumbing supplies is just downright weird.
While companies need to be mindful of not scaring customers away with overly friendly robots, customer attitudes are evolving as well. As automation becomes more intuitive and accurate, people will accept, even prefer, service from robots. Efficient, pleasant and effective service, whether from humans or robots, is always a treat for customers— and always reflects well on the brand.