Is your CRM/Loyalty Program infused with Artificial Intelligence (AI)?
According to New York Times journalists, John Markoff and Steve Lohr, many of the tech industry’s biggest companies like Amazon, Google, IBM and Microsoft, are competing to become the go-to company for A.I
In the very near future, intelligent software applications will become commonplace and machine learning will touch every industry. Today, only about one percent of all software apps have A.I. features, IDC estimates. By 2018, IDC predicts that at least 50 percent of developers will include A.I. features in what they create
Retail is one sector where Artificial Intelligence has immediately found acceptance. According to a study, 77% of UK retail directors think that AI, deep learning and machine learning implementations will have a tremendous impact on their businesses with 23% claiming they’re already seeing results
It’s no wonder retail is a great fit. The technology can understand and interpret customer preferences to make more accurate product suggestions, manage inventory based on predictive modelling and even identify ideal store locations. The industry, valued at $126 billion in 2015, is expected to reach $3 trillion by 2024
Loyalty can be a tough metric to master. It can also make or break your business. Once you can accurately calculate customer acquisition costs and lifetime value in a reliable way, you’re an investment away from achieving scale. In a modern marketing ecosystem with 1-1 engagement becoming the rule rather than an exception, the old “buy ten get one free” punch cards of your won’t cut it.
In recent years, the supermarket giant Tesco dropped the number of offers it sent out by nearly two-thirds but massively increased its revenue from conversion and ROI by using this type of technology. Tesco achieved a 675 percent growth in its bottom line, as a result of its data-driven loyalty programme. By analysing customer data, Tesco found that 80 percent of the discounts and offers utilised by customers came from 20 percent of the offers generated. This prompted a reduction of offers from 750 to 300 a year, amounting to approximately $600 million savings in promotion expenses while increasing market share
Machine learning creates enormous efficiencies because you no longer have teams of campaign managers generating and managing hundreds of offers – many of which are actually delivering negative ROI. So instead of sending out 100 offers, you can send out 30 offers but each one of those 30 offers will have a much higher conversion. And not only is that a much better use of a business’s time and energy but it will also surprise and delight your customers when they start to receive offers that actually matter to them.
Today, the brands who aren’t already researching or employing AI could be operating with a disadvantage.