Marketing has evolved significantly from the days of ‘one-size-fits-all’ messaging. For today’s marketers, merely garnering customer satisfaction is not enough. A delightful, consistent customer experience across multiple communication and commerce channels is the deal maker. Marketers today have technology in their arsenal to meet and exceed their customers’ expectations. Among these rapidly disseminating, new and disruptive technologies, artificial intelligence (AI) is poised to have the biggest impact on the marketing function.
Consumer spending habits have changed. While consumers are guarded about their spending, they are also shifting to digital models and e-commerce. An organization’s ability to strengthen its marketing capabilities to deliver superior outcomes and transform into a truly ‘intelligent enterprise’ will determine future success.
In this paper, we talk about how marketers can leverage AI to complement their marketing strategies for an integrated approach in an era of hyperpersonalization. AI enables organizations to collect and analyze valuable data, providing insights to enhance digital marketing strategies. Customer insights using predictive analytics can be deployed to maximize marketing ROI by targeting customers with the right content at the right time.
The scope for intelligent technologies in marketing strategies
The marketing function is a window to the customers. It is the first touchpoint to creating an indelible customer experience. Customer satisfaction is just one of those touchpoints. Going beyond to deliver a consistently superior customer experience is more vital than ever.
To thrive in today’s digital landscape, organizations must have the ability to innovate and revolutionize marketing to address their customers’ needs. Among marketers, customer experience has emerged as the top priority for marketers, according to a research by ‘The CMO Survey’, wherein one-third of the respondents prioritized customer experience as a key goal1.
While customer experience remains a top priority, are organizations leveraging new and disruptive technologies to enhance marketing? Among these rapidly disseminating technologies, AI is poised to have the biggest impact on the marketing function.
Wipro’s recent “State of Intelligent Enterprises” survey2 suggests that while marketing organizations are at different stages of evolution, only 28% of them expressed that their marketing functions were completely mature with appropriate AI/automation enablers. This indicates that there is significant opportunity for organizations to enhance their marketing functions and improve customer experience.
Interestingly, while 61% of organizations indicated that AI was critical in improving customer experience, marketing was not in the top 5 functions that have adopted AI. The findings clearly indicate the scope for adopting intelligent technologies to drive innovation in marketing functions and ensure business growth.
Changing priorities in consumer spending
Post-pandemic, there has been a tremendous increase in demand for better, more personalized digital experiences. With customers spending more time on the internet, the marketing function needs to remain focused on brand building and customer retention online. Organizations must re-think their go-to-market strategies to acquire new customers.
With all the job losses in the last year, consumer spending is cautious. Research among 2,500 people in the US in the previous year indicated that a majority had changed their spending habits3. In India, a study by ETMoney indicated that people had reduced overall spending by 40%4 in the midst of the pandemic.
Yet, in 2021, retail spending has revived, with an increase of 5.3% in the US alone5. More importantly, consumer spending habits have changed. As a result of global lockdowns, online spending surged. Studies indicate that despite the pandemic and its effects, global retail e-commerce sales are expected to grow 27.6% for the year, to a total of $4.28 trillion6.
These statistics underpin the growing importance of post-pandemic marketing and the organizational ability to strengthen marketing capabilities to deliver superior outcomes and transform themselves into a truly intelligent enterprise.
Leveraging AI to complement marketing in the era of hyper personalization
Today’s consumers cannot be targeted with a cookie cutter approach. Hyper personalization is the new buzz word, which means a successful marketing strategy must take advantage of the massive leap in technological innovations and disruptions.
Marketing strategies that incorporate these emerging technologies enable organizations to deliver great customer experiences. Using AI to creating personalized consumer experiences isn’t new, especially with things like personalized recommendations for products and services, a seamlessly integrated chatbot, or voice-assisted support systems having been used for several years now.
AI enables organizations tremendous capabilities to collect and analyze valuable data, providing insights to dramatically enhance digital marketing strategies. Customer insights using predictive analytics can be deployed to maximize marketing ROI by targeting customers with the right content at the right time.
With the accelerated adoption of digital channels post-COVID-19, organizations, especially those with low product differentiation, stand to gain significantly with AI. Let’s consider a few use cases where AI has a deep impact on the marketing activities:
- Improving return on investment with customer segmentation: One of the most efficient ways to improve marketing campaigns is to target the right customers with the right message at the right time. A customer that perceived personalized content is more likely to buy and in turn, become a loyal customer as well. A classic example is the coffee chain, Starbucks, which used loyalty cards to · collect customer data and leverage that data to personalize customer experiences. So when a customer walks into the coffee shop, the barista was likely to know their preference/choice of beverage already.
- Enhancing customer experience through predictive analytics: By leveraging predictive analytics, organizations can plan, develop, strategize and implement future marketing campaigns. Predictive analytics is also an important tool in inventory management, customer segmentation, predicting customer behavior, and in crafting targeted campaigns. Online retail giant Amazon has been known to use predictive analytics effectively in targeting customers and offering personalized content to them.
- Using chatbots to enhance customer experience: Chatbots for customizing and personalizing customer experiences is perhaps the most popular use case for AI. Intelligent chatbots help organizations provide customers with intuitive, responsive, and dynamic communication that addresses their needs and helps them make buying choices. Gartner predicts that by 2022, 70% of white-collar workers will interact with conversational platforms on a daily basis. Gartner’s 2019 CIO Survey revealed that CIOs identified chatbots as the main AI-based application used in their organizations7.
- Generating targeted content for different customer segments: With the help of AI tools, some content tasks such as emails, personalized messages, and social media messages can be automated. Also, AI can be used to curate content. The leading motor cycle company, Harley Davidson, leveraged AI to increase sales in New York alone by 2,930%8. Along with targeted content, the AI tool Albert used key performance targets and other data to create microsegments to test campaigns and then widen the scope of the messaging to the targeted potential customers.
In addition, the role of the Chief Marketing Officer (CMO) in boosting adoption and supporting the change cannot be emphasized enough.
Things to consider before investing in a marketing solution
Service versus product marketing: Solutions for services marketing must focus more on the capability to reach/connect with customers in an effective and innovative way, considering that service companies do not offer a tangible product with visible benefits.
B2B versus B2C: The key difference between the two types of marketing is the method of purchase decision. Typically, B2B decisions are logic and thought process driven, while B2C purchases are impulse, emotion and person driven. Hence, the marketing solutions for both categories should be radically different.
Gartner’s 2020 CMO spend survey reports CMOs across industries view technology as the path to customer intimacy, with technology expected to account for 26%9 of the total marketing budget. This demonstrates that while marketing functions of various industries have different marketing spend budgets and different recovery timelines in a postpandemic scenario, technology spend remains a priority.
With automated solutions, organizations have the potential to save significant costs. However, it is important that the technology is deployed correctly and smartly. For example, when an airline customer sarcastically tweeted “Thank you for flying me to Delhi and sending my luggage to Hyderabad at the same time”, the tool only picked up the keyword ‘thank you’ and replied with - “Glad to hear it, keep flying with us,” ticking off a downward spiral on the brand’s reputation online. Such errors can be avoided by using NLP solutions with AI to create a smarter framework and being more responsive to customers.
The sales and marketing functions of an organization are deeply interlinked, and sales is driven by the marketing team’s responsiveness. The AI solutions for marketing functions must be able to closely integrate with sales tools to maximize benefits.
Data is the critical element in AI models. With increasing volume and complexity of data sets, organizations must focus on building AI models/solutions that factor in changing customer preferences, sentiment analysis, and competitive intelligence.
The marketing solution imperative
AI is a valuable tool for digital marketers. AI can influence customer choices with predicted recommendations and customer service, incorporating AI technologies will enable brand growth and help meet customer expectations. With fast-changing customer preferences and expectations, it is imperative to understand demand and optimize the product mix. As companies invest in improving their digital marketing strategies, they must evaluate a design-led framework to refine demand prediction, personalize, and optimize offerings10 based on changing customer habits and sentiments.
With Wipro’s Marketing Sciences Lab11, a repeatable, fast, business-outcome focused offering for experimenting with data-driven business insights, organizations can deliver short- and long-term business value across marketing, advertising, and sales.
Get in touch with us at firstname.lastname@example.org to know more about this solution and how a good design and outcome-led framework can provide marketing the impetus it needs in today’s competitive landscape.