Having read the article “Marketing In the Age of Alexa” (written by Niraj Dawar and published by the Harvard Business Review last June), is hard to not be left worried and yet somewhat optimistic about the future trends in consumer marketing (check it here).
In brief, this article (which I vividly recommend reading) showcases how the increasing exposure from consumers to virtual assistants like Alexa, Siri, Google Assistant, and many others, will, in the future, serve as a “blocker” to the traditional marketing strategies employed by branded products companies.
Since AI assistants understand habits and preferences and deliver better results though continuous interaction with their users in a self-reinforcing cycle, the increase in satisfaction and efficiency from the experience of shopping though AI might serve as reason for consumers to avoid other (nowadays) usual go-to market platforms as online shops and telephone services.
Therefore, the article makes the point that this shift in everyday habits of consumers will dramatically reshape the landscape of businesses’s customer acquisition strategies and also improve and change the easiness on which consumers experience buying.
In my opinion (which is aligned to Niraj’s argument), the change in consumer behavior might be a threat to companies because consumer’s allegiance will shift from trusted brands to a trusted AI assistant. From the supplier’s point of view, this will demand for customer acquisition tactics and campaigns to focus on a single channel platform and, not only that, but the reshaping of acquisition models will force companies to pay these AI platforms if they want to continually get consumer information and to be “listed” on the AI’s decision making tree as “possible” (or promoted) suppliers for the consumer’s needs…
In addition, these AI assistants will be harder to convince since they store and weigh all information available in a round-a-clock basis, so the competition will be higher and also better targeted to the same product range, which, as traditional business knowledge states, is not a healthy state for a business to be (higher competition leads to lower margins and higher production volume needed; for a better explanation, Peter Thiel makes a great argument about it in his book with Blake Masters: “From Zero to One”).
It sounds a little bit “monopoly’ish” doesn’t it? Well, yes.
So, what’s the bright side?
In opposition to supplier’s loss of “comfort”, the common consumer might experience a much better buying experience. Using Niraj’s own words:
“AI assistants will not only minimize costs and risks for consumers but also offer them unprecedented convenience. They’ll ensure that routine purchases flow uninterrupted to households—just as water and electricity do now—and manage the complexity of more-involved shopping decisions by learning consumers’ criteria and optimizing whatever trade-offs people are willing to make (such as a higher price for more sustainability).”
To get a better understanding at it:
- Virtual shelf space;
- A single channel for markering, sales and service;
- Data on consumer preferences, purchases, and media exposure;
- Payment for goods sold;
- Product fulfillment;
- A trust halo.
- Customized recommendations;
- Automated routine purchases;
- Convenience and savings;
- Reduced complexity;
- Continual scanning for better deals.
- Listing and promotional fees;
- Product information;
- Innovations tailored to consumer’s needs;
- Knowledge about product category.
- Payment for goods;
- Information on product preferences, purchases, and use;
- Information on price sensitivity, risk tolerance, and privacy expectations;
- Loyalty in exchange for good recommendations.
In the end, AI will redefine the relationship between sellers and consumers. Brands might lose power as consumers focus will probably shift their attention towards AI assistants and in this new scenario push strategies (getting platforms to promote products) might be more important than pull strategies (motivating customers to seek out your brand in an active process.
Answering the title question, “Is the future of Marketing bonded to Artificial Intelligence?”, in my opinion, yes, very much so, even if brands don’t want to.
Author: André Ferreira, Motofil’s Sales and Marketing Manager