The impact of artificial intelligence (AI) on marketing

Mark Britton Jones

Consultant Lecturer, Glion Institute of Higher Education

How will artificial intelligence (AI) affect the future of marketing? And what does this mean for career opportunities in the profession? We asked faculty member Mark Britton Jones, who delivers a specialized marketing course to Glion students, for some answers…

Speak to any experienced marketer and they will be able to reel off the famous “seven Ps” that define the profession: Product, Price, Place, Promotion, People, Process and Physical evidence.

This is a good place from which to begin a journey towards understanding the present and future impact of artificial intelligence (AI) on marketing – in hospitality, luxury, and beyond.

For those who are not immersed in the world of marketing, it can often be seen purely through the prism of promotion – advertising, content creation, sales promotions, and so on. These are all very visible aspects; but in reality, marketing is a discipline which is extraordinarily diverse. And many of the different facets of marketing can be supported and enhanced by AI technology.

Types of AI involved in marketing

You cannot think about marketing without going all the way back to the first of the seven Ps: the product. Here the big evolution came about in the 1990s, when companies began to study their consumers in greater detail, thinking more seriously about their wants and needs, and using these are the starting point when creating new products and services.

Ever since, we’ve seen an increasing appetite for quality consumer insights; and this is the first important area where I want to talk about the impact of AI in marketing. Already, the technology has proven itself an efficient and effective tool for data mining in order to generate consumer insights.

That’s incredibly useful in an era where companies are data rich to the point of being overwhelmed. Without the speed of analysis provided by AI tools, marketers run the risk that by the time they’ve developed consumer insights at a granular level, the market has already moved on!

Of course, any time we speak about consumer data we must also acknowledge the data protection aspect. Companies have a duty to continually reassure consumers that data will not be gathered against their wishes; also that any data they consent to share is handled correctly.

From a global perspective this remains something of a ‘wild west’, with varying levels of protection for the consumer. In Europe, the GDPR regulatory environment affords a high degree of data protection; Australia, too, is pretty good in this area. Whereas in the United States your data tends to be seen much more as a commodity to be traded.

As the use of AI for data mining becomes more widespread, demands for consumer protection and data security are sure to become louder.

From a content marketing perspective, we know that brands are already using generative AI platforms such as ChatGPT to produce marketing content. While these systems still have their limitations, I do think that for smaller businesses – a standalone boutique hotel, for example – which may not have the capabilities in-house, using generative AI can be cost effective (even when outsourcing to a marketing specialist) as well as offering benefits in terms of speed to market.

Communication relating to your brand is, of course, a two-way process. And on that topic, we’re already seeing AI-powered tools being used to enhance searches for a brand’s media coverage. It’s not so long ago that one or more members of a marketing team would have to read all the day’s newspapers and take physical cuttings of any instances where their company was mentioned. Now this can be done almost instantaneously – and across a vast array of media – by AI-powered search bots.

Benefits of leveraging AI in marketing

Another of the seven Ps in marketing is promotion. And here the most interesting development is the migration from an advertising-led ‘tell and sell’ approach to one where the focus is on facilitating a conversation between brand and consumer. When done correctly, these conversations forge the kind of lasting engagement that could not be achieved through pure broadcast advertising, whatever the media (but especially in the quick-fire world of social media advertising).

However, before you can converse with a consumer, you must first locate and identify them. AI technology can help a brand spotlight its customer segment more precisely, and this is especially important in the luxury sphere, where premium brands don’t need to speak to everybody. I believe luxury brands will invest more in identifying their key consumer group(s), understanding where those people receive their information, and how best to engage with them in a targeted and appropriate fashion.

“I believe luxury brands will invest more in identifying their key consumer group(s), understanding where those people receive their information, and how best to engage with them in a targeted and appropriate fashion”

This trend is also why I think we may see luxury and ultra-luxury brands move away from pop-up stores, which have been quite widespread in recent years. In reality, the ‘open to all’ pop-up is perhaps a tool more suited to a mass-market brand.

Of course, conversations with consumers are not just taking place in the online world. Industries such as hospitality and luxury retail are all about people, another of the seven Ps. In these industries, the face-to-face element means the emphasis will remain on other, more human skills: emotional intelligence, cultural intelligence, and so on. These have far more impact than artificial intelligence when it comes to day-to-day customer interactions.

Where AI can support hoteliers is by equipping them with useful, actionable information about the customer. A good example from the luxury hospitality sphere is Dorchester Collection, which deployed a machine learning AI platform to analyze customer reviews, subsequently using what it discovered to invest in its breakfast product as this was the guests’ most favored meal.

This is important, because in the business of hospitality the guest experience is inseparable from marketing, given how the impression we leave on our customers is so crucial to the health of our brand.

Another area in which AI can benefit the hospitality industry is through automating repetitive, menial tasks that are part of hotel operations. This not only removes some of the drudgery from certain hospitality roles; it can also significantly enhance the overall guest experience, with employees freed up to interact more with guests. From a hiring perspective, it means hotels can focus less on process-oriented skills and more on individuals with genuine ‘people skills’.

Guest stars

“In the business of hospitality the guest experience is inseparable from marketing, given how the impression we leave on our customers is so crucial to the health of our brand.”Mark Britton Jones

Challenges of using AI in marketing

Aside from the data security aspect I already touched upon, another challenge for AI in marketing – and one which can be applied across the digital marketing space – is in the area of retargeting.

As a marketing tool, this remains something of a blunt instrument. I’m sure everyone reading this piece will have experienced the phenomenon of visiting a retail website, which then seems to follow them around the internet through programmatic advertising. It can be immensely off-putting and it’s something which I feel companies need to tackle in order to avoid alienating their consumers. The algorithms need to become smarter and more intuitive, so they can actually create value for the consumer.

Another challenge for me is more of an ethical nature. It relates to the ‘P’ of price, and in particular the manipulation of prices based on consumer searches of online travel agents (OTAs) and aggregators (which are themselves representatives of the ‘P’ of place). What I’m referring to is the phenomenon whereby you can go on a site and search for, say, flights from London to Paris. That activity will be tracked by an algorithm; then, if you leave the site and return to do the same search later that day, the prices you see can sometimes be artificially hiked because the system thinks you must be a committed buyer.

Is this ethical? Opinions vary and some might call this merely a form of supply and demand management. But we are in an age when brand reputations can be shredded in moments if something negative goes ‘viral’ – and with that in mind, I feel operators are playing a risky game.

Career opportunities presented by AI in marketing

From a career point of view, there are obvious opportunities for those who are skilled in taking AI-generated profiling and turning that into consumer engagement strategies, as well as for individuals capable of creating suitable content to drive conversations with the target consumer groupings. For example, we’ve already seen social media marketing become an in-demand discipline, and it’s an area which is sure to grow.

I also think we’ll see individuals who are comfortable with using technologies like blockchain coming to the fore in the marketing space. We’re already witnessing an intersection between blockchain and AI; and without a doubt blockchain can play a part in areas such as loyalty marketing, rewards marketing and distribution. If you want to know more, perhaps a good place to start might be the Executive online course dedicated to blockchain which Glion launched earlier this year.

Conclusion

Marketing remains, at its heart, a profession which relies on its foundational “seven Ps”. Create a campaign based on those fundamentals and you are unlikely to go too far wrong. However, what AI is doing is to give us additional tools with which to build on the profession’s foundations and deliver some new and innovative ideas.

I hope this piece has helped to convey the scale of the AI opportunity to marketers, especially in relation to the efficiency and effectiveness of mining the wealth of data they now have at their fingertips.

AI marketing solutions are sure to see the sort of accelerated development typical of the technology sector, bringing benefits such as better targeting and effectiveness of campaigns, more efficient content creation, and more personalized interactions between brand and customer.

And, of course, as with any technological evolution, there will be new roles and functions created, providing opportunities for those who want to build a career in marketing.

There’s no turning back the technological clock now; so let’s embrace AI and adapt to this changing marketing landscape.

Photo credits

Main image – hirun/Getty
Marketing 7Ps – Olivier Le Moal/Getty
AI button/graph – Vithun Khamsong/Getty
AI glasses reflection – Maria Korneeva/Getty