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Happy Monday, <<First Name>>!

So, we didn't all get sucked into some big black hole when the clocks hit 00:00 on Y2K eve, but we did witness the demise of the Non-Technical Marketer in the decade that followed, as we moved from analogue to digital.

That led into a decade of digital marketing, where data, metrics and analytics was anyone ever talked about.

And now, we've finally entered the decade of AI.

Most marketing tools already use machine learning (ML) to deliver everything from better analytics to deeper personalisation.

I see tools being sold to marketers as "using AI" and we convenience, and always welcome efficiency, so we fork over the money and don't ask many questions. (We wouldn't know what they were on about even if we did!)

And as AI becomes of age and gets more precise, more reliable and finds more applications in real-world scenarios, we'll need to meet it halfway.

In today's Business of Marketing, I'm covering AI in marketing:
  • Starting with how 'Weak AI' has already transformed our lives to
  • real-world examples of AI in marketing and ending with
  • advice on how to evolve from being a software-driven business to an AI-driven one.

We've entered the decade of AI: a look at how AI is becoming the norm in marketing

Let's start with the basics.

An algorithm is a series of preprogrammed steps that are executed in a sequence. Some algorithms follow those steps and deliver an outcome while others can also learn and improve.

While AI research has come far, most AI available today falls in the 'weak AI' bucket, as opposed to Artificial General Intelligence, where a machine can make decisions like a human.

The good news is that we don't need to achieve singularity to make a perfect coffee cup.

The most common form of AI used in most tools is Machine Learning, and the output of these algorithms depends on the data being used to train them.

The idea of optimisation through testing and learning isn't new in the business, but ML has given it a scale never possible before.

Entrepreneurs who understand the rules of running AI-powered businesses have already created new markets and disrupted industries. In fact, 'weak AI' is already impacting billions of people's lives through services offered by Google, Facebook, Amazon, and Microsoft.
 

Data is the life-force of our algorithm-dependant world.


But gathering volumes of data alone doesn't make a good algorithm.

Most organisations today don't have a common method for gathering, processing and using data.

Add to this the further complexity of data privacy. We're pushing ourselves closer to the walled gardens of tools, and platforms that already control so much of our marketing budgets.

Over-reliance on data without accountability is already causing problems with AI.

Here's some career advice: as a marketer, learning to think critically about data and the tools available for extracting value from data, can be both professionally and financially very rewarding.
 

5 real-world examples of AI for marketing

 

1) Facebook's AI lifestyle assistant learns your tastes and simplifies the shopping experience.

Facebook is using AI to transform the way people shop. GrokNet uses state-of-the-art image recognition to recommend products based on representing your personal tastes obtained by analysing items that you already own.

By generating a virtual replica, you can see yourself wearing the clothes and accessories you're considering. Maybe soon we can kiss fitting rooms goodbye?

The model has been deployed on the Facebook Marketplace and is already reinventing the shopping experience.

2) Dell is using AI to improve marketing copy

Declining engagement with their copy had significant downstream effects on revenue. Hence, their marketing team needed a data-driven solution to supercharge response rates and display why certain words and phrases outperform others.

Dell partnered with Persado, a technology provider for AI-generated marketing creative, to harness the power of words in their email channel and garner data-driven analytics for each of their key audiences.

They now use AI to create personalised ad copy and creatives in their promotional and lifecycle emails, Facebook ads, display banners, direct mail, and even radio content.

3) You feed the Google AI daily

How much do you use Google? Probably every day, right? Whether you realise it or not, you're constantly interacting with their AI.

Outside of autosuggestions and Google knowing what you’re searching for before you do, their algorithm update RankBrain is the epitome of AI in marketing. It weighs user experience metrics like bounce rate, click-through rate, and average time spent on-page ranking websites.

These metrics speak volume about how humans interact with a website. Because if a high number of users bounce and don't stay for long, your website is probably irrelevant to them, or the quality needs improvement.

As businesses publish more content and users interact with it, Google uses this data to become smarter and offer better search results for everyone.

4) Air BnB uses AI to optimise pricing in real-time

Airbnb uses machine learning to include things like the building’s features, location, and other traits while comparing it to nearby places, and help AirBnB users find the best price for their stay while getting renters more customers.

Their AI can decrease prices to fill rooms if it believes they will remain empty and increase prices as demand rises near holidays and events.

5) Nestlé uses AI to predict hidden consumer demand

Their AI scans songs and popular media in the public domain to uncover trends around food consumption.

Surprisingly, they discovered that there were at least 50 instances of ice-cream linked to breakfast. Additional market research revealed that sweet products were proving to be a popular breakfast item in the US.
 

Led by these insights, Nestlé launched its “Breakfast for Dessert” product series, which became an industry standard.
 

How to champion the move to AI in your organisation

 

Data-Analytical Thinking isn't going to replace creativity anytime soon.

In fact, the more algorithm-driven we become, the more there's a need to establish a human context behind what we say and how we say it.

This might sound counterintuitive to some since data, especially in marketing, is often used to counter the rampant and misguided use of intuition.

The future of marketing is driven by tools that will take over most of our responsibilities that require manual input. We've already seen that happen with Google Ads and Amazon.

And that's just the start.
 

Big tech companies (Google, Amazon, Apple, IBM etc.) have already developed technology that enables AI algorithms to run directly from phones and other consumer devices without needing to interact with cloud services – which would traditionally be required in the absence of powerful computing hardware.

This tech, which has been dubbed 'tiny AI', results from researchers shrinking the size of existing AI models via a process known as 'knowledge distillation'.

And without losing any of the original algorithm's capabilities or performance speed, I might add.

Tiny AI has zero latency (no communication between the device and the cloud) and fewer privacy issues.

This shows that as technology improves, it will only become more prevalent in marketing and how consumers connect to products.

One day soon, we'll be wondering how we ever lived a life without it.

It doesn't matter where you are in your journey towards evolving from being a software-driven organisation to becoming an AI-driven one, here are the 5 things to champion the future:

  1. Make benefitting from AI possible for everyone instead of a select group of people.
  2. Kill silos by unifying how your organisation gathers, manages and utilises data.
  3. Invest in educating and training your team.
  4. Increase Data and AI literacy among decision-makers.
  5. Instead of thinking in terms of standalone tools, start thinking in terms of digitalisation roadmaps.

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In case you missed:

Why I can't stop talking about social e-commerce

I’m not a big social media user, never have been.

But I can’t stop talking about social e-commerce. We’ve been driving people back to our sites through ads for years, and now we can get them to see the post, click a button and make the purchase without ever leaving their feed.

Add same-day or next-day delivery on top, and you’re looking at a ‘purchase journey’ where need recognition and purchase happen almost instantaneously. This puts a whole new spin on the path to purchase and media planning.

2021: The year of B2B Digital Selling

Sadly, it’s not the same as e-commerce, retargeting or any number of other B2C performance marketing tactics. At least not right at the start.

As traditional sales channel, venues and rituals are moving online, B2B marketers are building a new approach to marketing and sales of products that could cost anywhere from 50 000 to 500 000 - Digital Selling.

Your approach to Digital Selling needs to be different than anything you may have done so far. Here’s some good advice on reaching new customers when you can’t meet them in person.

State of Mobile

And TikTok had the cake and ate it too. According to App Annie, “TikTok's average monthly time spent per user grew faster than nearly every other app analyzed, including 70% in the US and 80% in the UK - surpassing Facebook. TikTok is on track to hit 1.2 billion active users in 2021.”

Here’s the thing that makes this exciting. Facebook and IG still dominate the market, and as we know with Stories, Facebook was able to slow down Snapchat. But at least so far, Reels doesn’t seem to have the same effect in TikTok’s growth.

Through TikTok’s integration with Spotify, we may be looking at a real heavy-weight contender to challenge Facebook.

Why whatever Bezos touches turns to gold

It’s the sheer brilliance of his approach to business. Amazon doesn’t waste anything. Just look at how they monetise their infrastructure. Take the Amazon Marketing Cloud, for instance, launched in 2019 to fuel Amazon’s ad-network is now available to publishers, brands and adtech for building their own data clean rooms.

How to make free trials work for your product

I love me a free trial. And 7/10 times I’ve subscribed to the product - mostly software or an app.

I’m a little ashamed to say that I often get offended when a SaaS provider doesn’t offer a free trial. When all product pages make the same promises, you need to experience the product before deciding.

This new research sheds some light on how to offer free trials and to whom. Apparently, when it comes to trying products where product experience matters, it’s not the low usage or high usage users that convert better.

It’s the inbetweeners, or medium to high users that are most likely to stick around after the trial.

These 5 articles are from my daily digest where I curate the best content covering everything from emerging trends in marketing, consumer behaviour, retail, public policy, strategy and technology. You can sign up here.

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“Much of the messy advertising you see on television today is the product of committees. Committees can criticize advertisements, but they should never be allowed to create them.”

- David Ogilvy 

I think the wisdom above applies to most advertising, don't you think?

Until next week,
Aliyar

PS. Are we connected on LinkedIn? No? Let's remedy that, shall we?
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Thanks for reading and sharing! BR, Aliyar.
Had so many espresso shots you can't remember why I'm sending you these emails? You're receiving these email because you opted in (on my website aliyarhussain.com) to get this weekly espresso shot of knowledge, confidence and inspiration to your inbox. That was a good move, but if you want to take a bad turn down a dark alley, you can easily update your preferences using the links below. | Aliyar Hussain, Rysäkuja 3 a 5, Helsinki 00980, Finland

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