Futuristic Circuit Board Render With Bokeh Effects
Artificial intelligence (AI) is one of the hottest topics in marketing right now. Raj Venkatesan and Jim Lecinski recently published a book entitled “The AI Marketing Canvas: A Five-Stage Road Map to Implementing Artificial Intelligence in Marketing”. To better understand what an AI marketing canvas is, I sought insight from Raj Venkatesan, a professor at the Darden School of Business. In full disclosure, I work with Raj and find his research and work fascinating. Below is insight on the AI marketing canvas.
Kimberly A. Whitler: Why did you and Jim write this book?
Raj Venkatesan: We heard and experienced the rise of data and algorithms. Marketing professionals had started to pay attention to this, and they wanted to invest in this new technology. But they were struggling with the why and the how questions. They needed guidance on the ultimate objective of using AI in marketing, i.e., how is marketing—and customer relationships—going to improve from using AI. There were books written at a very high level regarding whether machines would take over. You know, is the Matrix going to take over, or for the younger people, are we all going to be in Halladay’s game, the Oasis, like Ready Player. On the other hand, there were books written around 10 steps to better email marketing. Very granular, but again not at the strategic level a senior marketing profession would want to use AI. So, we set out writing a book, that we feel is like the goldilocks solution, not too high, and not too granular.
Whitler: How do you explain what AI means to a marketer?
Venkatesan: My philosophy is to use AI to supercharge the customer experience through personalization at scale. I frequent this Chinese restaurant near Darden, Peter Chang. They greet me by my name, know where I like to sit, what I like to order, and when I call them, they know exactly what I would want. They know my kids and family etc. Now this family that owns Peter Chang might know their regular customers intimately and would be able to remember about 200 of their regular customers if they are REALLY GOOD. AI is about taking this level of personalization to 10s of millions of customers. Brands like Chick-fil-a, and Starbucks are trying to achieve this personalization using AI in their mobile apps and translating the insights from the app into personalized in-store customer experiences also. So, SBux knows what drinks I like, what sandwiches I normally get, they might know that I have kids (because my son loves the Vanilla Bean Fappacino and Cake Pop), if ordered ahead on the mobile app, the barrista can address me by my name etc.
An effective strategy is to use AI to personalize each aspect of customer engagement; acquisition, retention, growth, and advocacy (or word of mouth). Modern marketing is about using first party consumer data and algorithms to personalize the firms’ marketing for acquisition, retention, growth and advocacy. The idea is to put the customer in the center and use AI to enhance the customer’s experience with the brand.
Whitler: In your book you propose a five-stage roadmap for including AI in your marketing strategy. Can you explain?
Venkatesan: The five-step roadmap provides marketing managers a tool to plan and develop their AI marketing strategy. It consists of five steps; foundation, experimentation, expansion, transformation, and monetization. Foundation is about collecting relevant first party data that is the essential input for any AI algorithm. In the experimentation stage, a firm attempts to personalize one aspect of customer engagement. In the expansion stage, the firm personalizes more than one aspect of customer engagement, and in the transformation stage, all aspects of customer engagement are personalized. In the monetization stage, the firm uses all the developed AI capabilities to develop a services/software platform that provides on-demand services to other business, thereby developing a new revenue stream.
Whitler: Which industries can hope to achieve maximum impact?
Venkatesan: Firms that have a direct to consumer of customer relationship can achieve the maximum impact. AI in marketing requires good data that are directly collected from the consumers, i.e., first party data. In the research for our book we found that firms across industries, including consumer packaged goods, banks, B2B firms, retailers (online as well as brick and mortar), technology firms, pharmaceutical firms, travel and hospitality industries, media, and software, are using AI in their marketing strategies.
Whitler: What are some tips for an early-stage startup to use AI in marketing?
Venkatesan: The roadmap talks about a small steps approach. You should start with the experimentation stage, work with a vendor to first evaluate personalization in SEO/SEM. Website and customer service personalization. Salesperson call patterns of customers etc. If it works out, you can build more in the expansion stage. You have the advantage of no legacy costs when collecting first party data.
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