Artificial intelligence, especially machine learning, is an integral part of marketing nowadays. Read on for part two of our complete primer for AI in our industry right now.
See part one: Five ways AI marketing is changing your life
Product pricing
Estimating the price to sales ratio, or price elasticity, is hard with many products and factors that impact sales.
Dynamic price optimisation using machine learning can help. It can correlate pricing trends with sales trends by using an algorithm. It can then align other factors such as category management and inventory levels. Mohammad Islam from BI/Data Science Manager at JJ Food Service Limited wrote a handy introduction to price optimisation.
Predictive customer service
Knowing how and why a customer might get in touch is valuable information. It allows for resource planning and personalised communications.
USAA is testing this technique. It involves an AI technology built by Saffron, now a division of Intel. It analyses thousands of factors to match broad patterns of customer behaviour to those of individual members.
The AI has so far helped USAA improve its guess rate from 50% to 88%, successfully anticipating users’ next contact and for which products.
Ad targeting
Andrew Ng, Chief Scientist at Baidu Research, tells Wired, “Deep learning [is] able to handle more signal for better detection of trends in user behavior. Serving ads is basically running a recommendation engine, which deep learning does well.”
Algorithms will achieve the best cost per acquisition (CPA) from the available inventory when optimising bids for advertisers,
Machine learning helps to increase the likelihood a user will click when it comes to targeting via programmatic ads. This might be optimising what product mix to display when retargeting, or what ad copy to use for certain demographics.
Speech recognition
Translation of speech has come so far over the past five years due to progress in neural networks.
Skype Translator now supports Arabic, English, French, German, Italian, Mandarin, Brazilian Portuguese, and Spanish.
One reviewer of this product using the recently added Arabic speech translation said that mistakes occurred but ‘with enough patience, I usually got the message’.
Siri, Cortana and other virtual ‘personal assistants’ also use speech recognition, so most savvy consumers are aware of how accurate they are – or not!
Speech recognition is particularly important in the Chinese market, where using a keyboard to type small and intricate characters can be laborious. Baidu is making big strides on this front with voice search.
Language recognition
Behind speech recognition sits the challenge of language recognition. Not what you’re saying, but what it means (in relation to other things and concepts).
Brands have started using language recognition to digest unstructured information from customers and prospects. WayBlazer is a so-called ‘cognitive travel platform’, a B2B service using IBM’s Watson AI to power consumer applications from third parties such as hotel chains and airlines. So, for example, images, recommendations and travel insight are personalised depending on customer data.