The Growth of Artificial Intelligence for Smart Prediction in E-commerce
This trend is much trickier to predict because it is genuinely new, rather than a continuation of trends which have been building for several years.
The increasing data available to marketers has massively increased their ability to target customers over the past few years, but increased ability doesn’t instantly translate into increased effectiveness. Sometimes marketers can get too caught up in marketing speak and buzzwords and patting each other on the back, and fail to see what the consumer actually sees. What all this ‘big data’ and ‘hyper-targeting’ usually adds up to when I think about what I actually experience as a customer (rather than as a marketer) is getting served ads for products I’ve already bought. Generally, if I buy something online I’ll get served re-marketing ads advertising the damn thing for a good few weeks afterwards. Cracking targeting – they got me stop on; I really did want that book of Nigella Lawson recipes. Thing is, I actually bought the thing, so it’s actually the worst targeting in the world – I’ve never been less likely to buy it!
So this targeting is precise and informed by data. But it’s still stupid. What it needs to be is smart. That’s the missing piece of the puzzle. That’s where Artificial Intelligence comes in.
Funding for artificial intelligence start-ups has increased massively in the past three years. Data for Q1 2016 also shows the number of deals hit a quarterly record, and looks set for a considerable increase on the 2016 figure.
My bet is the venture capitalists are onto something, and 2017 will be the year where AI tech really comes into its own. By combining genuine intelligence with the piles of data now available thanks to analytics and tracking software, ad targeting will be able to get a whole lot smarter. Moving beyond a simple ‘customers that bought X also bought ‘A, B and C’ to a system which learns what makes each individual marketed to tick, and tailor messaging to exactly match what works on them.
Marketers, especially those in larger organizations, should be looking at how AI tech can help with their ad targeting and personalization strategy. With IBM letting companies utilize it’s famous Jeopardy-winning Watson AI system, and many other providers entering the market, 2017 will be the year digital ad-targeting gets smart.