BKM Marketing Perspectives | Marketing Blog

AI Revolution | #2 How AI is Revolutionizing Customer Segmentation in Digital Marketing

Written by BKM Marketing Associates | Sep 27, 2023
INTRODUCING

"From the Desk of AI" Blog Series

As introduced in the first blog post of this series, "AI Revolution: Unleashing the Power of Artificial Intelligence in Digital Marketing":

It is no surprise that "Artificial Intelligence," "AI," and "ChatGPT" have become common topics of discussion in your marketing meetings, brainstorming sessions, and strategy planning sessions over the past few months. These buzzwords are constantly being thrown around, making it challenging to understand their true meaning and how they can impact your business. In the coming weeks, our evolving series of blogs aims to provide clarity by exploring the pros and cons of tools like ChatGPT, how you can effectively utilize them as resources, and what you truly need to know about AI amidst the overwhelming marketing chatter.

With our first blog series, "From the Desk of AI," we start with a simple approach. We will showcase the exact prompt we provided to ChatGPT for a relevant marketing topic and the corresponding output it generated. We will then analyze the strengths, weaknesses, and neutral aspects of the ChatGPT response. This analysis will highlight how ChatGPT can be a valuable asset for expediting content creation while also addressing the potential risks it poses to your business and its reputation. For instance, you may have heard about Vanderbilt University's Dean's email regarding the MSU mass shooting, which concluded with the phrase "Paraphrase from OpenAI's ChatGPT AI language model, personal communication, February 15, 2023"... Need we say more?

Building on the insights gained from our initial blog post, "AI Revolution: Unleashing the Power of Artificial Intelligence in Digital Marketing," with our second post, "How AI is Revolutionizing Customer Segmentation in Digital Marketing," we aim to enhance the quality of content created through AI by incorporating key takeaways and learnings.

Based on our findings from our initial post, we have identified that AI-generated content often lacks a personal touch, sounds overly mechanical, and fails to provide curated examples as expected. In order to address these shortcomings in our second post, we have deliberately refined our prompt to incorporate the following elements:

- Adopt a more relatable and conversational tone

- Highlight success stories from specific industries, such as lawn care or banking industry

By implementing these adjustments, we aim to examine how the content transforms and improves. Let's delve into the results and witness the difference it makes...

 
TEST CASE

From the Desk of AI | Blog Series #2

How AI is Revolutionizing Customer Segmentation in Digital Marketing

CHATGPT PROMPT

Write a blog post article titled "How AI is Revolutionizing Customer Segmentation in Digital Marketing: Strategies and Success Stories" that is written in a relatable, conversational tone and features success stories from either the lawn care or banking and financial industries

 
CHATGPT OUTPUT

Introduction:
In today's digital age, customer segmentation plays a crucial role in targeting the right audience with personalized marketing messages. And with the advent of artificial intelligence (AI), businesses are now able to take customer segmentation to a whole new level. In this article, we will explore how AI is revolutionizing customer segmentation in digital marketing, and we'll delve into some inspiring success stories from the lawn care and banking or finance industry.

Segmentation with AI:
Traditionally, customer segmentation has relied on manual analysis of demographic data and purchasing behavior. However, AI algorithms can now analyze vast amounts of data to identify patterns and preferences that humans might miss. By leveraging AI, businesses can segment their customers more accurately and effectively.

AI algorithms can analyze not only basic demographic data but also factors such as social media activity, online browsing behavior, and even sentiment analysis from customer reviews. This allows businesses to create highly targeted marketing campaigns that resonate with individual customers on a deeper level.

Success Story 1: The Lawn Care Industry
Imagine a lawn care company that wants to target customers who are most likely to need their services. By using AI-powered customer segmentation, they can analyze data from various sources, such as weather patterns, property size, and previous customer behavior. With this information, they can identify potential customers who are likely to need lawn care services, such as those living in areas with high rainfall and large properties. By tailoring their marketing efforts to these specific segments, the company can increase their conversion rates and maximize their return on investment.

Success Story 2: The Banking Industry
The banking and financial industries have also seen significant benefits from AI-driven customer segmentation. For instance, a bank can utilize AI algorithms to analyze customer data, including transaction history, spending patterns, and financial goals. With this information, they can create tailored financial products and services that meet the specific needs of each customer.

By leveraging AI-powered customer segmentation, banks can identify customers who are more likely to be interested in specific financial products, such as mortgages or investment opportunities. They can then personalize their marketing messages and offers to these segments, increasing the likelihood of customer engagement and conversion.

Additionally, AI algorithms can also help banks detect and prevent fraudulent activities by analyzing customer behavior patterns and identifying any suspicious transactions. This allows banks to proactively protect their customers' financial assets and maintain trust and loyalty.

Conclusion:
AI is revolutionizing customer segmentation in digital marketing by enabling businesses to go beyond traditional demographics and tap into the power of data analysis. Whether it's the lawn care industry or the travel industry, AI-powered customer segmentation has proven to be a game-changer. By leveraging AI algorithms, businesses can gain a deeper understanding of their customers, create highly targeted marketing campaigns, and ultimately drive better results. As technology continues to evolve, we can expect even more innovative strategies and success stories in the future. So, embrace the power of AI and unlock the full potential of customer segmentation in your digital marketing efforts.

 

ANALYSIS

BKM Marketing Thoughts + Findings

CRITIQUE

Overcomplicating the Topic with Complex Usage + Applications

AI certainly did not hold back in showcasing its advanced usage and applications in analyzing complex data from various sources. It provided everything from segmenting users by weather patterns, property size, spending patterns, and suspicious transactional behavior. While this is impressive, it way overcomplicated the simple prompt and came across as very overwhelming.

The prompt specifically called for strategies and success stories, but rather than really highlight any strategies, the content primarily focuses on how amazing AI is at analyzing complex data. Where are the strategies? How is someone in the lawn care or banking and financial industry supposed to learn from these success stories and apply this?

While AI has the capability to analyze vast amounts of data and provide valuable insights, digital marketing should focus on actionable steps and practical applications to ensure that these insights translate into tangible results --- a topic that AI completely circumvented when it shot for the moon with its complexities...

Useless Section Breakdowns/Headers

The use of header titles in the blog post, such as "Success Story 2: The Banking Industry" and "Conclusion," feels too structured and may not resonate with readers seeking the more conversational tone that was requested in the prompt.

While headers are important for organizing the content and guiding readers through the article, they should be crafted in a way that feels natural and relatable. By using less formal and more relatable headers, you can create a more engaging experience and ensure that viewers remain captivated. 

Instead of using a dry header like "Success Story 2: The Banking Industry," a more inspirational approach would be with something that grabs the reader's attention and maintains a conversational tone, such as "A Banking Breakthrough: AI Unlocks New Opportunities."

Jumps to the Extreme

Rather than showcase how AI can analyze data to identify sales or engagement opportunities, the output completely skips the basics --- where most digital marketers could actually use the help.

AI's output jumps to an extreme and recommends analyzing vast amounts of data to identify patterns or preferences "that humans might miss". While it's true that AI has the capability to process and analyze large datasets efficiently, it's important to strike a balance between the complexity of data analysis and practical application in digital marketing.

Missing the Fundamentals

In order to fully leverage the power of AI in customer segmentation, marketers should start by understanding the fundamental principles and objectives of their marketing campaigns. This includes identifying key performance indicators (KPIs), defining target audience segments, and setting measurable goals. By establishing a solid foundation, marketers can then utilize AI to enhance their understanding of customer behavior and preferences.

Big Talk But No Action

The output offers a wide range of ways in which AI can analyze data from various sources. However, it falls short in providing actionable steps for marketers to implement these insights. While it's impressive to identify potential customers based on living in high rainfall areas, it's essential to understand how to utilize this information effectively. Do you send an email? A/B test rainfall-esque email subjects? Offer a specific deal? Target with paid ads? 

Unfortunately, the success stories and overall AI drafted content lack concrete examples of how to leverage this knowledge and apply it to marketing strategies.

Where is the Practical Application?

While it's impressive that AI can identify potential customers based on the amount of rainfall, it's essential to have a clear plan for utilizing this information effectively. Without actionable steps, these insights are not of any use.

By focusing on practical applications of AI-generated insights, marketers can ensure that their digital marketing efforts are not only data-driven but also customer-centric. This means translating complex data analysis into clear and concise action points that can be implemented effectively.

 

PROS

By adjusting the prompt to request a more relatable and conversational tone, along with specifying the industries to focus on, we were able to tailor the content accordingly.

Conversational Tone - With these changes, the article now reads more smoothly and conversationally compared to the previous post, "AI Revolution: Unleashing the Power of Artificial Intelligence in Digital Marketing." Although there is still a subtle robotic undertone due to the lack of a human author's personality, the AI successfully simplified the language and structure of certain sentences, making the article more easily understandable.

Specific Industries - Providing specific industries in the prompt helped us create success stories that are relevant and tailored to those industries. However, it is important to note that the lack of specific brands, examples, and use cases continues to provide a sense that the article is not fully reliable.

Additionally, by specifying the industries, AI has the ability to provide excellent examples of how wide-ranging its applications can be when it comes to collecting and analyzing patterns. As mentioned earlier, AI can uncover patterns and preferences that may go unnoticed by humans. However, it's important to note that making effective use of this information requires the necessary expertise and knowledge.

Success Stories - In terms of summarizing success stories, the article did a better job for the Banking Industry. It mentioned how data analysis can suggest types of mortgages or investments, as well as flag potential fraudulent activity.

 

Overall Impression

AI seemed to go a bit rogue and forget to tie-in the actual focus of this article - digital marketing... The article was supposed to showcase how AI is revolutionizing customer segmentation in digital marketing --- where are the digital marketing strategies? Where are the use cases of how AI can revolutionize customer segmentation as it applies to digital marketing?

While the banking applications were more digestible, AI still failed to tie much of the banking success stories into use cases and practical applications, as they pertain to digital marketing.

 

NEXT UP IN THE SERIES

Stay tuned for our upcoming blog posts in the "From the Desk of AI" series as we continue to explore and enhance the usage of Artificial Intelligence in digital marketing. Don't forget to subscribe to our blog to receive the latest insights and expert advice on leveraging AI in your digital marketing efforts.

We appreciate your participation in our exploration of the transformative power of AI in the marketing landscape.