We would not be amiss if we said that the world is fast leaving behind the traditional forms of advertising. With AI-powered digital marketing taking center stage, digital marketers are working on offering a better product to their customers. They are focused on improving customer journeys and boosting their return on investment (ROI) using personalized ads. Marketers are deploying big data analytics, machine learning, and other processes to attain customer insights that help build more compelling customer touchpoints. AI can eliminate guesswork in customer interactions when offering customer support, engaging in email marketing, or automating processes such as content generation, PPC ads, or web design.
The global AI market has experienced tremendous growth over the past several years and is projected to expand at an impressive compound annual growth rate (CAGR) of 36.6% from 2024 to 2030. This is welcome news for businesses that are investing heavily in digital advertising.
AI’s Role in Digital Marketing
In layman’s terms, AI uses complex algorithms to examine large amounts of data, spot patterns, and subsequently make recommendations based on what it has learned from the past. It helps marketers save time and money while providing many benefits, such as improving efficiency and accuracy, better targeting, and augmenting customer experience. There are several ways AI can support digital marketers:
- Content curation and generation: AI can help curate and generate content and market it to the right audience on the right platforms. It has the potential to generate viable topics for writers, create initial drafts of content based on specific parameters, and map out an exhaustive content strategy.
- AI-enhanced digital advertising: AI is changing the way businesses advertise. Take electronic billboards, for instance. Known as programmatic advertising, these billboards operate autonomously, using complex algorithms and big data to market the ads to the right audience. The Premier League uses virtual advertising on their sideline boards, showing different ads for broadcast TV depending on the channel and the country they broadcast the match. AI allows businesses to optimize their ROI by only placing ads in front of relevant viewers, which can be personalized at scale.
- Chatbots: AI-powered chatbots allow businesses to offer a customized customer experience. They engage with customers through personalized marketing messages and offer recommendations based on their past behavior and preferences. Chatbots can also communicate with customers using real-time, original responses.
- Machine translation: By using AI-powered machine translation technology, marketers can create ads in multiple languages quickly and efficiently. This technology allows them to automatically translate ad scripts from one language to another without a hitch.
How is AI-powered digital marketing helping marketers?
AI-powered digital marketing has several benefits. It can target customers with increased efficiency and accuracy by using predictive consumer segmentation and creating personalized customer experiences. This allows marketers to predict whether shoppers will be interested in purchasing their product or service. In addition, it helps collate data from previous customer journeys to predict future outcomes for new customers. You can also send personalized automated emails or better target your customers through social media ads using personalization. Doing so helps enhance customer experience and reduce costs simultaneously, as targeted ads have the best possible ROI.
One of our clients, a multinational conglomerate having 300+ brands under its umbrella, was grappling with poor product positioning leading to subpar sales. We ran a thorough performance monitoring and optimization campaign to achieve visual consistency and brand harmonization for its products globally. This robust strategy helped in the successful localization of previously “hard to sell” products, ensuring their compliance and optimized performance in various markets. Our efforts resulted in successful optimization of 250+ products across the board.
AI in Advertising: What strategies are being adopted?
Marketers are using several AI-powered advertising strategies to engage and retain customers. These strategies include: 
- Predictive analytics and data analysis: AI-powered predictive analytics analyzes large amounts of data to identify patterns. These patterns allow marketers to predict customer behavior, including which products they are likely to buy or the likelihood of them shifting to a competitor. Predictive analytics helps forecast future trends and make data-driven decisions that enable marketers to optimize their marketing campaigns, spot new opportunities, and adapt their strategy to any change in customer behavior.
- Natural language processing (NLP): NLP helps derive insights from unstructured data, like customers’ written or verbal responses to your product or service. Marketers can apply NLP in several ways. It can be used to enhance your company’s brand and gauge the effectiveness of its branding strategy, how on-point your brand positioning truly is, and what your present and prospective clients say about your brand.
NLP can help generate relevant, high-quality content more quickly, but it may be unable to produce content that can resonate with readers. At the end of the day, AI cannot replicate human touch, which is needed to connect with readers emotionally. In addition, NLP can help generate targeted leads by keeping tabs on potential customers’ needs and problems. This can help businesses target customers based on their brand awareness, buying intent, etc. - Recommendation engines: Simply put, a recommendation engine is a system that recommends products, services, or information to users after careful analysis of their prior data. For example, if you have bought a printer from Amazon in the past, it will likely recommend you buy print cartridges and paper from time to time.
How are the behemoths using AI-powered digital marketing?
Let us go through some real-life case uses of AI-powered digital marketing.
Amazon's product recommendations
Amazon was one of the first companies to start using machine learning to offer personalized product recommendations to their customers based on their prior purchases or browsing history. Amazon keeps a record of every purchase made by you, your wishlist, your product browsing history, your downloaded apps, the addresses you’ve lived and worked at, any product ratings or reviews written by you, any TV shows or music you have played, and everything that you have asked Alexa. It can use all this information to suggest product recommendations to you.
Netflix's personalized content suggestions
Netflix has pioneered using AI-driven machine learning technology to offer personalized content recommendations to its users. It suggests content based on what the user has enjoyed in the past. More than 80% of the shows watched on Netflix today are based on personal recommendations made by its AI platform.
Spotify's music recommendations
Spotify makes use of hyper-personalized recommendations to recommend audio content to its users. It focuses on creating long-term user satisfaction by leveraging user data, from creating playlists to listening history to how users interact with the platform. Doing so allows Spotify to predict what you might want to listen to next. This way, Spotify can offer every user a hyper-personalized, highly customized version of its product. You can even say that without AI, it wouldn't be possible for Spotify to exist as a business.
Further, Spotify uses natural language processing and deep learning to power natural language searches. This helps improve your search results as it does not need to exactly match your search with the words in a song title to find what you’re looking for.
Google's personalized search results
Google personalizes a user’s search results based on their prior search history, their location, and previous interactions with Google's products and services, among other factors. It makes use of machine learning algorithms to do the same.
Do consumers need to be wary of AI-powered digital marketing?
There is no denying the apparent benefits of AI-powered digital marketing. That said, there are some ethical concerns that one has to be mindful of and ensure that user data and privacy are not infringed upon.
- Data privacy and security: By combining AI with digital marketing, marketers can personalize advertisements and campaigns for individual users. They analyze customer data comprising their behavior, preferences, and demographics. Doing so allows marketers to tailor their marketing efforts to be more effective and relevant to the customer base that they are targeting.
But to do so, large amounts of data must be collected and analyzed. This raises privacy concerns. Businesses can alleviate these concerns by being transparent about how they collect and use customer data and by giving their customers a choice to opt out of data collection if needed. - Transparency and accountability: By being transparent, businesses can help build customer trust and avoid tarnishing their reputations. They can do so by eliminating third-party data and allowing users to share what data they want.
- Algorithmic bias: AI systems are only as good as the data they process. If the data is biased in some form, the AI will reflect those biases. For instance, if an AI system is trained on data covering certain demographic groups disproportionately, it may make inaccurate assumptions or predictions for those outside those groups. This may result in discriminatory advertising. To reduce this risk, businesses must regularly audit and test their AI systems for bias and ensure that their data covers diverse groups. This would help lower the potential for bias in AI algorithms.
- Mass amounts of disinformation: AI has the potential to spread disinformation as it is designed to learn from the data it is fed. This means that if the AI is exposed to false information, it can spread mass amounts of disinformation that may negatively impact businesses trying to build brand awareness and trust with their audience.
How is AI-powered digital marketing shaping the future?
AI-powered digital marketing is bringing the future to us. Automating learning and decision-making enables the creation of insight or knowledge that can help improve performance. Marketers can choose the best methods to attain better results while lowering the possibility of human error. It has also led to the widespread use and adoption of targeted marketing, first implemented by Amazon with its recommendation engine technology.
Advancements in machine learning and AI
AI can enable businesses to hyper-personalize interactions using machine learning and big data analysis. The data collected derives deep customer insights to predict future customer behaviors better.
Integrating AI with other technologies
AI can be integrated with multiple technologies to enhance efficiency and improve customer experience. When combined with virtual reality (VR) and augmented reality (AR), shoppers can customize products and try out the different colors of the same dress to check what suits them the best.
AI-based cyber security systems maintain a database of the latest threats that can compromise the company’s network. This system helps prevent and protect the organization from any future cyber-attacks. In addition, AI can help detect malware and prevent it from infecting your company’s entire enterprise system.
Further, AI has seamlessly integrated with Search Engine Optimization (SEO) to augment the user’s search experience. The AI algorithm provides relevant results to misspelled search queries. In addition, it offers additional features such as image search and voice recognition to improve search results.
Potential impact on job roles in the marketing industry
There is a growing concern that AI could make certain marketing roles redundant through automation. The question arises of whether this fear has legs to stand on or not. Could AI really steal jobs?
While marketing roles may evolve and induce marketers to upgrade their skill sets to thrive in their jobs, AI is not expected to replace human marketers soon, making human resource skills and adaptability more critical than ever. AI can help automate repetitive tasks and optimize marketing campaigns, but more is needed to replace human judgment and creativity, intuition, and emotional intelligence. Even though AI can analyze vast amounts of data, it cannot interpret and act on that information. At least, not yet. Moreover, it may not interpret certain contextual factors accurately or understand diverse perspectives unique to different communities.
AI-powered digital marketing is here to stay!
There is no denying the fact that AI is making waves in the digital marketing world. It allows marketers to target their present and potential customers with personalized ads, and reach the right audience at the right time, thereby improving their ROI significantly. Companies worldwide are increasingly adopting AI as the benefits are hard to ignore. This is where Intelegencia comes into the picture. It uses AI and machine learning as support tools for processing and analyzing data to derive deeper insights that enable it to better target its clients’ audiences. Intelegencia helps businesses reinvent how they support their customers, employees, and partner ecosystems by streamlining their business processes, increasing cost savings, and improving their bottom line.