ai-marketing

Marketing with AI: Why Do We Need It?

The marketing industry is being disrupted right before of our eyes. Artificial intelligence is transforming almost every sector, and marketing is no exception. It is and will continue to create a new world that is vastly different from what came before.

Its prevalence will reach into nearly every part of our lives, and we can no longer afford to ignore it. Your competitors are already using artificial intelligence; now is the time to educate yourself and take action to give your company a competitive edge.

Artificial intelligence is transforming almost every sector, and marketing is no exception

In May 2015, IBM’s CEO Ginni Rometty made a bold prediction at the World of Watson event: “In the future, every decision that mankind makes is going to be informed by a cognitive system like Watson,” she said. “And our lives will be better for it.”

These are strong words, but IBM is effectively betting their company on AI, and so are many others.

We are witnessing a disruptive technological revolution that is likely to have wider impacts than even the industrial revolution a century ago.

IBM is effectively betting their company on AI, and so are many others.

We are at the precipice of a new world, and 2019 may well be the point in history that people will look back on as the point when the AI revolution truly began. We get to take part in this, to see it from the inside.

It’s an incredible opportunity.

Technical revolutions change the way we interact with machinery and open up vast avenues for future growth and innovation. From the invention of the wheel to Europe’s industrial revolution, they bring about amazing social change and advancement.

Manufacturing efficiency skyrocketed in the nineteenth and twentieth centuries with machines automating what was previously done with muscle alone.

Electrification changed things again, this time enabling work without natural light. This helped to create an era of convenient consumer products that improve the comfort of our lives.

The next revolution was in information technology, or IT, where automated data processing removed many manual and tedious tasks, particularly in offices.

We are now entering the era of artificial intelligence, where analysis and decision-making are automated too.

In fact, AI-guru Andrew Ng, co-founder of Coursera and adjunct professor at Stanford, claims that “AI is the new electricity.” The world will never be the same again.

In the coming years, AI will work its way into every part of our lives, just as electricity did in the early twentieth century. How often are we away from electrical devices, even while sleeping? With a few exceptions, almost never.

In the coming years, AI will work its way into every part of our lives

As this revolution continues and grows, AI will become just as ubiquitous. Already, we are using speech agents like Apple’s Siri or Amazon’s Alexa, and artificial intelligence are making marketing and business processes more efficient.

Did you know that AI has already crept into virtually any part of marketing, including conversion ratio optimization, customer journey optimization, ad purchases, and even reviews of legal documents?

No area of marketing – or business in general – will be untouched.

No area of marketing – or business in general – will be untouched.

This is why investors and corporations are in an arms race to invest in or acquire innovative AI startups. In just one year, KPMG’s Venture Pulse reports that venture capital investments in AI companies doubled from $6B in 2016 to $12B in 2017.

Business leaders should pay attention. This is a time of enormous opportunities—and great risks.

In fact, eBay CEO Devin Wenig declared in his keynote presentation at the ShopTalk conference in Las Vegas in 2017, “If you don’t have an AI strategy, you are gonna die.”

If you don’t have an AI strategy, you are gonna die.

AI will also profoundly change how businesses and customers communicate. For example, Gartner predicted that customers will manage 85% of their relationships with enterprises without interacting with a human by 2020.

Still, most consumers are largely unaware of how artificial intelligence will affect their lives.

Customers will manage 85% of their relationships with enterprises without interacting with a human by 2020.

A report by Sage reveals that 43% of US consumers and 46% of UK consumers have no idea what artificial intelligence is about.

With AI profoundly changing how we live, this lack of understanding can be problematic, as myths and misconceptions about the technology can overshadow reality.

AI isn’t as threatening as some may think, though there are risks and problems most people haven’t considered. Lack of knowledge may be a problem for society onwards.

AI will drive a massive shift in business models. In an AI-enabled and connected world, companies will have to adjust to new purchase patterns, or they will go out of business.

This includes everything from subscription models to pay-per-use strategies, and may result in a winner-takes-all scenario where some companies control nearly all of the market.

Entire industries are at risk of being wiped out as these changes become widespread, and the ones that survive will be radically different. For example, machines will soon begin making autonomous purchases in B2B and B2C contexts, changing distribution chains globally.

Entire industries are at risk of being wiped out

Gartner notes, “AI-derived business value is forecast to reach $3.9 trillion in 2022,” and that “in the early years of AI, customer experience (CX) is the primary source of derived business value.”

In other words, marketers are and will continue to be among the first to reap the benefits of AI. As this book will show, there is no shortage of innovative uses of artificial intelligence in marketing.

Marketers are and will continue to be among the first to reap the benefits of AI

Adobe’s CMO.com reported in March 2018 that “just 15% of enterprises are using AI. But 31% said it is on the agenda for the next 12 months. … The impact of AI technologies on business is projected to increase labor productivity by up to 40% and enable people to make more efficient use of their time.”

AI is set to significantly increase efficiency of advanced white-collar jobs in the near future—and remove some of them entirely.

Ray Kurzweil, one of the greatest futurists of our time, thinks machines will become smarter than humans by 2045, an event he calls the Singularity. From that point onwards, machines will continue to outsmart us with an increasing intelligence gap, leaving us further behind and reliant on them.

Machines will become smarter than humans by 2045

However, this doesn’t mean the world will end. In fact, Kurzweil isn’t particularly worried about this and sees AI as an opportunity for humans to grow and evolve.

Snother of the greatest futurists of our time – Elon Musk of Tesla and SpaceX – frequently warns us that AI could wield extreme levels of power that could very well be the end of humanity.

He calls for legislation to limit the use of AI before things get out of hand. Whichever side you take on this, it’s clear that once the powers of AI are out in the wild, they can’t be put back into the bottle.

Once the powers of AI are out in the wild, they can’t be put back into the bottle.

Whether a global threat or a new stage of human evolution, AI technologies signal a disruptive transformation.

While we might take the boldest predictions with a grain of salt, AI is already upending the marketing industry – and most other industries too.

Late entrants to AI-driven marketing may never recover, but early adopters will grow increasingly competitive. Artificial intelligence and machine learning run on data, and organizations with the most collected information are quickly creating an unfair advantage against smaller competitors with less data to process.

Artificial intelligence and machine learning run on data, and organizations with the most collected information are quickly creating an unfair advantage against smaller competitors with less data to process.

This is why companies like Google and Facebook are gathering every conceivablepiece of data on their users, even on topics that seem mundane. As we’ll find out later on, with enough data to analyze, even seemingly unimportant information can become powerful.

Along with artificial intelligence, automation is coming to the marketing industry, and many are questioning the safety of their jobs.

Marketing is also becoming increasingly reliant on data science. It is becoming data-driven, and the old methods of working by intuition and gut feelings are being replaced with models that draw on facts.

This enables self-optimizing and autonomous marketing systems that would have been considered science fiction to most people only a couple of years ago.

The good news is that with systems built on new data science technologies, marketing can become more relevant and provide better customer experiences, thus improving customer loyalty and returns.

For too long, marketing has been reliant on “spray and pray” methods that do little to create engagement. AI enables us to move from spammy and irrelevant mass marketing to personalized relationships again – but this time at scale.

AI enables us to move from spammy and irrelevant mass marketing to personalized relationships again – but this time at scale.

AI technologies will enable highly personalized precision marketing that is more efficient and provides far better customer experiences. However, these advantages are only possible for those with enough data to process, a forward-thinking mindset, and the right tools.

Scott Brinker is the VP of Platform Ecosystem at Hubspot and editor of the ChiefMarTec blog. On the topic of tools, he kindly gave me permission to reprint the 2018 edition of ChiefMarTec’s legendary yearly marketing technology landscape infographic.

While it’s difficult to read here, it demonstrates how complex the market has become:

According to ChiefMarTec, there are now almost 7000 different marketing tools on the market, up from only 350 just five years ago.

Even more interesting, Brinker removed predictive analytics as a category from the infographic this year. He explains the reasoning behind this change:

We got rid of the category for predictive analytics. It’s not that predictive analytics capabilities have vanished. On the contrary, due to the huge explosion of machine learning in marketing, predictive features have been added to hundreds of products.

In deciding not to have an artificial intelligence category — because AI is embedded in so many products across all martech categories — we realized that predictive analytics solutions would be better classified in the category of the capability they enabled (e.g., web analytics or sales intelligence).

Regardless of how they are arranged, the sheer number of companies and tools in the market today is staggering. With the explosion of tools and ever-increasing applications, AI is becoming integrated into almost every aspect of marketing.