AI, or artificial intelligence, has been the inspiration behind many a futuristic sci-fi thriller, but beyond its presence on the big screen, where does it fit in the real world, and are we still too far away to utilize it for business growth?
You may be surprised to find that many businesses are already implementing AI technology to achieve their goals and increase customer engagement. Much less intimidating than its on-screen representation, AI has had a growing influence in industries far and wide. Lately, it’s been increasingly used in restaurants and retail.
AI and Marketing
This year we’ll be completely automating and personalizing the old “coupon mailer” marketing strategy by using AI and machine-learning algorithms. We anticipate this to be a game-changer for omnichannel business owners.
The idea is that as soon as a customer completes their first transaction with a business, the algorithm will begin tracking the frequency of that customer’s purchases, as well as the types of products and services purchased, the amount spent, whether the transaction was online or in-store, and more.
All of this data is taken into consideration before a personalized offer is sent out weekly. This offer is customized based on very specific products and services, and it includes an expiration date, prompting the customer to act. The algorithm completely tailors offers based on what is most likely to help the business increase revenue from this single customer.
Imagine a customer’s favorite business sending coupons for specific products and services they are actually interested in. These things may not be immediately within the budget, but after the personalized offer, they are suddenly accessible and affordable.
Looking at the frequency of visits, the algorithm customizes the offer to expire just before this customer would normally go back and visit the store or website. By doing this, it speeds up the return visit to ensure the customer uses the personalized discount before it expires.
This model of marketing is a win/win for both the customer and the business. The customer can purchase coveted items at a more affordable price, while the business owner benefits from the increased business.
What’s on the Horizon?
Because of machine learning, algorithms become smarter and smarter over time. Eventually, it will reach a point where it will be able to track offer redemptions and results. Based on this information, it can continue to tweak future offers and coupon parameters to further increase redemption, while still staying within the guidelines of merchants in regards to maximum discount amounts, frequency, and items.
While we are still just scratching the surface of what AI is capable, its current applications are already helping business owners maximize revenue, customer loyalty, and offer redemption. AI is much less the stuff of sci-fi nightmares, and much more a business owner’s dream.