Bye Traditional Marketing, Say Hi to AI in Marketing

David Park

Published On:

September 10, 2020


January 25, 2022

How to Use AI in Marketing

AI will allow marketers to do what used to be unthinkable – target each user in their own personalized way. When it comes to marketing, the more intimately you target the person you are attempting to sell to, the easier it is to convince them to buy your product.

Currently, large companies invest millions of dollars on complex marketing campaigns that are multi-faceted. Marketers hope to capture the attention of people in several different demographics in the most optimal way. To do so, they to create separate marketing campaigns for each of the markets they want to address.

Movie Theater Scenario

Let’s examine a movie studio and their desire to get more people to buy tickets to their latest blockbuster. The way that they market their movie to people who have seen the prequel will undoubtedly be different from the way they market to others who have not.

There are hundreds of ways to categorize the possible viewers who may come to watch the movie, and the more you target each group the easier it is to convince them to spend their Friday indoors watching a motion picture.

Now imagine if every single advertisement the movie studio places was slightly different and tailored to each prospective customer that comes across it. That is one of the several ways that AI can change the competitive landscape of advertising.

AI can help you create smarter ads

Advertising and marketing can be more of an art form than science. To create an irresistible ad is to fully understand your prospective customer's wants and needs. Convincing a close friend to purchase something from a convenience store is much easier than convincing a stranger. This is because you intimately know the wants and needs of the people close to you in life. With Big Data and AI, every ad campaign can be just as effective as a friend at a convenience store.

If we continue the example with the movie studio, perhaps you have not seen the prequel leading up to this movie or read the novel that the movie was adapted towards. If so, the movie studio would probably show you a generic ad based upon your age group and your geographic location.

However, a sophisticated AI may try to use tertiary inputs to persuade you to buy a ticket to the film. Perhaps you just got out of a long-term relationship and feel trapped at home.

The AI could create a personalized ad that frames the movie as a great coming-of-age film about independence and that it is a great way to get out of the house.

We could even take it one step further and assume that the initial personalized ad did nothing for the individual. Theoretically, the AI could attempt to target the user hundreds of different ways until it finds an angle that encourages the user to click on the advertisement and learn more about the film.

Lastly, with the advancements in technology, the power of targeted advertising only increases over time. As the AI creates thousands of personalized ads that target individuals who have just gotten out of a long-term relationship eventually it will be able to create the perfect ad in the first few tries rather than the first few hundred.

When this tool becomes available, the traditional marketing strategies would be obsolete and it would be an arms race between marketing agencies over who can create the most robust and powerful targeting AI software.

AI can help you deliver the ads in the most optimal way possible

A man selling ice cream on a sunny day will always be more successful than a man selling ice cream in the middle of winter.

The setting where you see the product/advertisement can have a large impact on whether you are sold or not.

One of the ways that marketing studios optimize the delivery of ads is through social media. They allocate different amounts of money for each channel of their marketing strategy. Movie studios will place ads on Youtube, Facebook, and Instagram and use different strategies depending on where the user will find the ad.

Lately, movie studios have also been partnering with content creators and influencers to create more personalized marketing campaigns for the specific audience that watches their favorite creator.

In the near future, with the help of AI, movie studios could create tailored ad placements for every prospective customer.

Instead of placing an ad during a video containing an influencer, perhaps the AI may learn that you are most attentive when you are watching Instagram videos that a certain friend of yours posts. Instead of paying one influencer a large amount of money, an AI could instead distribute that money to thousands of micro-influencers or even non-influencers in attempts to brand a movie in a tailored way.

The AI could learn that paying a mother $5 to create a sponsored post about a movie would encourage all of her sons/daughters to watch a movie pertaining to motherhood in theaters. This ultra-targeted method of marketing could change the way advertisements are seen, as they can come from anywhere and can be shown to you when you are the most perceptive.

AI Can Help You Maximize the Profits From Ad Campaigns

Marketing isn’t just about finding customers; it’s about keeping them and learning from them. Any marketing expert knows that selling your service is just the tip of the iceberg.

A movie-goer who buys a movie ticket can still upgrade to a premium seat, buy a tub of popcorn, and purchase the film on blu-ray when it is released. As a prospective customer gets further down the funnel they become more lucrative and can be retargeted for upgrades or additional purchases.

"Premium, targeted service translate to more profit"

After purchasing your tickets, a smart AI would save costs and stop using marketing funds to convince you to purchase tickets. An even smarter AI, would then show you ads about why to watch the movie in Imax digital 3D instead of the traditional 2D ticket that you bought.

To pay an individual marketer to sit and write down each way a prospective customer reacts to an ad and how they feel after purchasing would be a monumental cost. To train an AI to do the same thing is a marginal cost that is easily recouped when the customer upgrades to the premium deluxe experience for twice the price.

Marketing never truly ends, and there is a plethora of angles to bring the movie studio even more money.

Perhaps the AI could lay dormant until the customer reconnects with an old friend looking for an activity during the weekend. In seconds, an ad that showcases the power of sharing motion pictures with your loved ones may appear on their screen. This could activate your customer and have him advocate to his friend that maybe he should join the customer this weekend to view this great motion picture.

The Power of AI in Marketing

The AI can be relentless; it can simultaneously be the most optimal marketer with the mentality of the coldest salesman on the planet. It would be a marketing genius with almost infinite data that works day and night with the single purpose of finding a way to convert a customer. This is something that could feasibly be created in the coming years.

Marketing may change from wanting to spend an allocated budget on a certain product to spending as much as necessary to have the AI do its best work. Spending $50 million dollars on a marketing campaign to sell $150 million in ticket sales is the usual metric used by marketing agencies.

However, an AI can have an unlimited marketing budget and continuously market to everyone who can be somehow persuaded to buy a ticket. They can start by converting diehard fans by placing a 50-cent targeted ad and eventually spend up to $14 dollars on a tailored marketing campaign to get a prospective customer to buy a $15 ticket. In current market conditions, this may seem like a terrible investment, but if the AI can do this 10 million times the movie studio adds an additional $10 million dollars to their revenue.  

Data is the fuel that powers AI and in the last decade, companies have a surplus of data that can be used to predict and persuade. It is only a matter of time before the ice cream merchant doesn’t even need to attend his cart. The cart can be automated to roll around by itself; waiting for the exact consumer to walk by in the exact circumstances so he can offer an innocent ice cream cone.  

If you would like to add AI to your business, we would love to help you increase your content output while also improving your content quality. Feel free to order a small starter pack from Jenni, so you can leverage AI to compete against your competitors and increase your sales!

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