Guide to AI Marketing – Meaning, Importance, Examples, and More

Find out what is AI marketing with examples and how you can incorporate it into your marketing strategy.

What is AI marketing? How is AI used in marketing? Is AI marketing the future? 

Today, the blog will cover these questions in detail and hopefully get you started with creating an AI marketing strategy for your business. 

Let’s explore AI marketing in detail. 

1. AI marketing meaning
2. How AI marketing works
3. Benefits of AI marketing
4. Challenges of AI marketing
5. How you can use AI marketing for your business

AI Marketing Meaning

AI marketing involves using artificial intelligence concepts and customer data to enhance customer journey and experience. 

Artificial intelligence is used in marketing to achieve efficiency in tasks and build a deeper relationship with customers. It can help in automating tasks, finding unexplored insights into customers and economic trends, etc.

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How AI Marketing Works

To understand AI marketing, there are three important factors to take into account. 

• Use of data in AI marketing
• Use of machine learning in AI marketing
• Use of AI platforms in AI marketing

These important factors can be better understood with examples. So read on. 

Use of Data in AI Marketing

Today, in the online scenario, it is much easier to connect with others. You would use applications including Gmail, Facebook, Instagram, etc. 

Then there is Google search where you can look up for information. 

So, whenever you are using a search engine or an app, you are filling up information about yourself in some way or the other. This data is collected. 

Now, all such information is continuously growing. By drawing insights into how you use apps, you are given suggestions that will be different from the suggestions provided to others using the same apps as you. 

Suggestions can be in the form of sponsored ads or similar posts on your Instagram feed for some similar content you watched before. 

This is perhaps the simplest example of how data is used in AI. 

Use of Machine Learning in AI Marketing

Algorithms dictate what AI can predict. These algorithms fall under the AI subset, machine learning. 

Put simply, the algorithms used for processing data for some outcome is machine learning. 

You can say, that algorithms are used when it comes to make sense of big data. Machine learning comes into play to identify patterns. In the marketing scenario, the common buying behaviours or interests of customers can help guide a successful marketing campaign. 

It can also help in automated decisions. Let’s take a popular example of machine learning. 

Spotify uses machine learning. Its ‘Discover Weekly’ is a flagship feature that uses three different models. 

• Collaborative Filtering  – It is used to make predictions based on user’s preferences; though it was first introduced on another music recommendation and listening platform, Last.fm.
• Natural Language Processing (NLP) – This is where human language is learned. In the case of Spotify, it reads how users type on the platform to look for an artist, song, genre, or album. 
• Audio Model – This is to assess raw audio tracks for classifying them into genres.

Now, another subset under machine learning is deep learning, which becomes more complex in terms of problem-solving. You can explore more of this in our blog on deep learning vs machine learning. 

Also check out the future of machine learning!

Use of AI Platforms in AI Marketing

Google has customers, users, and advertisers – a multi-sided network based business model. As more and more this base grows, it becomes difficult to provide customer service and solutions across these different channels (for customers, users and advertisers) that are personalised for each. 

While Google is just one example, there are many more companies that have such models. So how do they address the communication gap, because traditional marketing will not be able to? 

The answer is opting for artificial intelligence platforms. AI platforms guide marketing and sales teams in collecting and segregating vast amounts of data so that it is easier to make accurate decisions and engage customers. These data-driven decisions help in improved customer experience

These are the three basic factors to keep in mind when it comes to AI marketing. You can explore these factors in more detail in the course Artificial Intelligence in Marketing on Coursera. This 4-week course is in partnership with the University of Virginia with interactive quizzes with each video lecture. 

Benefits of AI Marketing 

Now that you have an idea of how AI marketing works and when it is used, find out the benefits. 

Nurture Customer Relationships Better

At the most basic level, companies can leverage AI chatbots. With these, companies can be available to customers round-the-clock. 

Even acquiring CRM (customer relationship management) software that is integrated with AI can help marketing and sales teams automate tasks. Such tasks could be recording calls, taking notes, etc. which are present in software such as Salesforce. 

Explore free Salesforce courses

Good customer relationships can also be maintained with apt customer segmentation that AI based CRM platforms can conduct at granular levels. Even the customer journey map can be easily mapped across unexplored touchpoints by AI. 

These elements make it easier to communicate with customers on a personal level. 

One of the top examples is Netflix. It uses hyper-personalisation by looking into data such as user viewing habits, history and ratings, etc. Based on their likes or dislikes, Netflix offers similar recommendations to keep audiences hooked. 

Make Better Marketing Decisions

By acquiring customer data across various touchpoints, marketing decisions can be made much faster. It becomes easier to make strategic decisions. 

AI can offer real-time analytics, meaning, when you are running a marketing campaign, you do not have to wait until the end to know about its performance. AI-based dashboards can help you with analytics whether it is going well or not, and you can make changes instantly. 

This is how you can improve the ROI of your campaigns. 

Automate Tasks

AI can automate tasks to help marketers focus on more important aspects. Tasks such as reporting, answering customer queries, etc. can be easily automated. 

Also check our blog on marketing automation

Apart from that, the whole content marketing process can benefit with AI. With the rise of ChatGPT from Open AI, you can use it to create outlines for your blogs and copies. There are paid tools also for content marketing that offer various AI capabilities. Frase and Surfer SEO are some. Frase is a brilliant research tool that reduces hours of your time researching topics, creating content briefs for your teammates, and rewriting and simplifying complex paragraphs or sentences. The inclusion of AI in content marketing is just the beginning and the benefits are endless.

Challenges of AI Marketing

While there are many benefits of AI marketing, it can have a few challenges. 

Skill Gap to use AI marketing platforms

Introducing AI in a company requires the right skills among marketers. It is more workflow related in the sense that, the workforce has to be initiated into using such systems. For that, training and development will be required. 

For instance, less capable chatbots are not able to handle complex queries. Human beings are still needed to handle them. Harvard Business Review in an article describes that less capable chatbots can be integrated with humans to answer complex queries. 

Needs Higher Investment

To fully take advantage of AI marketing, you would need more upfront investment. That is one reason why many small businesses were not using it. AI marketing involves automating complex processes across the customer’s journey. 

What is exciting is this year’s generative AI explosion with ChatGPT and Midjourney that have brought a revolution with free and nomincally priced AI-based tools for marketers.

Attack on Privacy

Marketing with AI is involved in collecting data. Nowadays, not a lot of people are comfortable giving away their personal information. The question of ethics in business arises because of that. But this can be solved once organisations follow regulations such as General Data Protection Regulation (GDPR). 

How You Can Use AI Marketing for Your Business

Before you look at the best tactics where you can leverage AI in your marketing efforts, you would need to answer these questions. 

• What are you trying to achieve first with AI – Is it customer acquisition? Is it to improve your communication?, etc.
• Will it help your employees?
• Do you have the budget to use AI marketing platforms?

Proven Tactics in AI Marketing

Ad Targetting with AI

You can use AI to target the right message to the right customers by analysing it. AI marketing tools can predict if the ad you worked on will work and based on that you can make a decision. This will lower your ad costs as well. 

Check out Google Ads courses too!

AI-enabled Sentiment Analysis

You can use AI for social listening across the web. Because it is nearly impossible to find how your brand is mentioned apart from the main social media channels. AI tools such as Devi can gather and monitor such data much faster. AI can also be trained to understand the sentiment present in a brand mention. 

Explore free social media marketing courses. 

Dynamic Pricing with AI

Dynamic pricing is really helpful based on the demand and supply of a product or service. AI-powered tools use an intelligent algorithm that can analyse the market fluctuations in prices every 24 hours or routinely. 

You can take the example of Airbnb. It uses an AI-based tool, known as Airbnb Smart Pricing. It looks into the amenities the listing offers and provides results of rental properties on top to improve user experience. 

Content Marketing with AIc

Parting Thoughts

So this is a snapshot of AI marketing in general. AI marketing is definitely the future but there are some challenges too.