Loyalty marketing includes tools that help marketers engage with consumers. Here are some pros and cons of digital mobile wallets, in-app rewards, blockchain-based loyalty programs, AI-based loyalty marketing and mobile devices with beacon technologies.
1. Digital Wallets, Great Organizers of Financial Lives
According to recent data, the average American carries 17 cards. This clearly shows how important it is for consumers to have an overview of their financial life (including their different loyalty programs). Digital wallets are ideal to help customers organize their financial and loyalty products.
2. In-App Rewards: a Loyalty Marketing Tool
The digitalization of reward programs can be an important driver for customer engagement. However, most In-App Rewards are based on a gamification context.
Rewards for better prices, discounts, special offers. In other words, this type of technology can leverage the value proposition to customers.
Makes feel your regular customer as a high-value customer, that fact can generate effective recency/frequency and at least more interaction with the brand.
Churn strategies; getting back old customers / capture new generations and/or new markets.
Leverage Ancillary Revenue / Check-in ratio / Leverage negative performance markets or flights.
Incentives for B2C markets.
Differentiation from competitors.
In-App can be very strong to generate engagement but also challenging to generate revenue.
Potentially low ROIs due to high operation costs (IT, back-end, front-end).
3. Blockchain-Based Loyalty Programs
Blockchain is a powerful strategy for loyalty marketing because of its inherent safety. The most valuable asset of a loyalty or Frequent Flyer Program is the data. Blockchain is designed to store transactional data in a secure and decentralized way. Customers appreciate this model because it is a “Loyalty Hub”. This technology can simplify the process of applying and keep customers from having full wallets/apps or accounts/passwords with the brands they want to interact with.
Blockchain is designed to store transactional data in a secure and decentralized way.
High redemption rates.
Analytical and statistical information / more accurate information / give the customer what they need, when they need it and at the right price.
Customer incentive oriented: “Buy what you need and I’ll reward you”.
Traditional loyalty programs reward you for the extra purchase when customers realize that is a problem. Here the information is secure.
Loyalty Hub: customers always appreciate simple and centralized platforms.
Points can be changed for cryptocurrency.
High UX costs.
High consulting costs.
Blockchain technology may not yet be popular enough.
4. Artificial Intelligence
Nowadays is not enough to get customers and generate leads from e-commerce strategies. It is a must for companies to start being AI and Machine Learning oriented in some way. This is not a trend, but a real need. Brand marketers and loyalty marketing experts are looking for deep learning experiences that allow recording and auto-analyzing customer information. AI can enable an extremely high degree of personalization. To get the most out of AI it is important for managers to understand market behaviors, customer preferences, demographics, etc.
Brand marketers and loyalty marketing experts are looking for deep learning experiences that allow recording and auto-analyzing customer information.
5. Mobile Devices with Beacon Technologies
Frequent flyer travel programs or loyalty coalition programs are common currency in the travel and lifestyle sectors. These programs provide customers the opportunities to use/redeem the points (virtual coins) they win in the regular day-to-day shopping to acquire plane tickets, accommodation, car rental, ancillary airline products, etc. Beacons allow these programs to be farther reaching and help opening new markets, generally abroad.
Social media plays an ever-changing role for marketers. The strategy’s strength is in the ability to humanize your brand by engaging with the consumer. And engagement leads to conversions. How to stay current as social media changes is a key discussion point at Portada Council System meetings. Learn how Portada Council System’s leading brand marketers offer solutions to keep ahead of social media’s evolving role.
SMS or messaging apps are on the rise with 41% of travel marketers planning on implementing this in the near future. (Sojern)
Three out of five travel companies are using chat for customer service with 28% actively using or experimenting with AI technology. (Phocuswright)
The majority of marketers (77%) are using one or more social media platforms but only 48% have a positive ROI from these strategies. (Impact)
Three Social Media Challenges for Portada Council System Members
1. Managing Brand Reputation and Trust
Related comment: “Your customers don’t necessarily trust Influencers (since most know they are being paid). It is better to win them over organically.”
Social media make it easier to discredit a brand. Companies should try to turn these experiences into something positive.
2. Training Staff to Provide Consistent Customer Service
Related comment: “Right now, the front line staff is composed by people who are not prepared enough for the job.”
We have to make all messages coincide across roles in spite of the emphasis of each area.
3. Increased Complexity and Cost of Social Media Strategies
Related comment: “It is vital to understand the way each platform works.”
Even though the reach is there, it’s getting gradually more expensive.
Practical example: Using an algorithm that answers immediately on social media without the customer noticing it’s a chatbot. Instead of having hundreds of people answering, a company could hire less high-profile employees to do it right.
When the algorithm can’t solve an issue, there’s a seamless transition to a human specialist.
AI is on the way to transforming the marketing world as we speak. While it is still in its nascent stage, it offers marketers a wealth of tools for leveraging data about customers to understand their preferences and journey with your products.
More importantly, it allows brands to keep up with customers’ increasingly high standards and expectations. Customers want their interactions with brands to feel personal and relevant, and AI enables a level of targeting and tracking that any marketer should get excited about.
But distinguishing between what can be implemented now and what will be possible in the near future is important, as the field of AI is in constant evolution. Here, we break down the different ways marketers can use AI to streamline operations, deliver better customer experiences and channel data into insight.
AI can be defined as a subset of computer science through which machines display “intelligence” by making predictions and decisions. AI acquires intelligence based on the analysis of data sets, a process enabled by algorithms that tell the machine how to complete tasks and interpret information.
The most basic form of this is machine learning, which uses historical data to predict future outcomes. As the machine acquires more data, it becomes better at making predictions.
AI already driving marketing budgets, data-driven insights
Recent studies reveal the important role that AI plays in driving marketing budgets and business growth strategies. Marketers clearly believe that AI is a valuable tool: 72% of marketers surveyed in a PWC study view AI as a “business advantage.” By 2021, organizations are projected to spend $57 billion on AI platforms for marketing.
And organizations are already seeing the results of implementing AI: 3 of 4 companies using AI have reported a boost in sales of at least 10%. 75% of organizations in another study say AI has driven customer satisfaction by at least 10%.
In terms of how CMOs are currently implementing AI, another recent survey found that many are using it for content personalization (56.5%), predictive analytics (56.5%), and targeting decisions (49.6%). But those are just a few of the ways AI can support marketing efforts today.
AI has 8 broad applications in marketing today
Marketers are accumulating data at an astonishing pace with the intention of harnessing it into better targeting. But sometimes the mere volume of data that organizations acquire makes it difficult for them to know how to make use of it. AI is incredibly helpful in this respect, as it enables real-time analysis of large volumes of data, automate tasks, and generate insight.
1. Market intelligence and insight:With the help of algorithms, machine learning enables in-depth analysis of complex data sets from data management platforms (DPMs), data warehouses, or other repositories, connecting the dots to support marketing intelligence and forecasting in a way that humans cannot.
2. Customer profiles and personas:Through the analysis of on-site interactions, purchasing history, referral sources and geo-specific behavior, AI can help brands form a 360-view of their customers and match them with personalized content and promotions.
3.Lead generation and sales:Machine learning and predictive analytics can help marketers automate the process of generating and scoring leads. They also help brands keep customers engaged through predicting turn: through analyzing users’ engagements with brands, they can tell when someone is about to drop off. Brands can then attempt to re-engage these users with notifications and emails.
4. Media buying: AI automates the laborious process of media buying and ensuring that ads are seen by relevant audiences through programmatic advertising and optimization and measurement platforms. With almost no human input, AI helps marketers analyze, manage, and measure the performance of ad campaigns.
5. Customer experience: According to Gartner, 85% of customer service inquiries will be handled via AI by the end of 2020. AI is increasingly being implemented in the customer experience space to support improved call centers and automated customer service via chat bots and digital assistants.
6. User experience: AI helps marketers optimize user experience on websites through analyzing data about single users’ behavior to personalize content, promotions, and notifications. A study from Evergage found that 33% of marketers are using AI for more personalized website experiences, and that 63% of them noted increased conversion rates, while 61% assert that customer experiences have improved.
7. Natural language generation and content creation: There are a variety of applications for AI in the realm of content. Using simple rules and formats, AI-enabled tools and platforms can author content such as business reports, product descriptions, stock market reports, and sports recaps without human input. Through setting the rules and formats, marketers can dictate the tone and style that the content takes.
AI-enabled content platforms can also make suggestions about what kinds of content formats and topics a brand’s target audience is likely to engage with through tracking users’ online activity.
8. Chatbots: While chatbots technically fall under customer experience, they have changed the marketing world in such a way that they deserve their own dedicated text. AI-enabled bots are successfully delivering customer service for thousands of global brands through natural language processing and machine learning.
Natural language processing allows machines to interpret the meaning of written and spoken speech and respond accordingly, all without human intervention. The machine can track the effectiveness of its responses and adapt accordingly, improving as it has more conversations.
Marketers must self-educate before selecting vendors
Marketers considering ways to implement AI in their organization have to be careful when evaluating different products and platforms. Many use the term “AI” loosely, mislabeling tools that implement data processing and analytics as “AI.” Smart organizations can bring in experts to educate and advise them as they consider the alternatives.
Ask questions about the data sets they use and pay attention to whether they have data scientists on staff. Request a demo and confirm what deliverables and KPIs will be included in their activities.
Make sure your data is clean and high-quality
While AI might seem like magic, it still depends on effective human inputs: namely high-quality data that it can learn from. If marketers don’t format data in a way it can be processed, or you do not have the infrastructure to process it correctly, it will not produce an “intelligent” machine.
To this end, marketers must innovate and collect more annotated data that can be tagged to train AI systems. Measuring only clicks is not going to create a rich enough data set to use for impactful AI.
Remember the human touch
AI will be able to replace humans in many, but not all, of the brand interactions customers expect. Consumers are excited about AI – an Acquia study found that 53% of consumers say they are “looking forward to artificial intelligence making interacting with brands a better experience.” At the same time, the study found that 85% percent claim that “a human touch is needed, in addition to technology, for a positive customer experience.”
Marketers should only use AI where it will enhance customer experiences, and it turns out there are plenty of situations in which people prefer to speak to a human than a machine. 75% of the respondents to the Acquia survey agreed that “the problem with automated experiences – interacting with technology instead of a real human – with brands is they are too impersonal.”
The future of AI in marketing depends on smart investments
Implemented correctly, AI will offer us tools that make our work better, easier, and more enjoyable. Marketers will be able to focus on the strategic, creative elements of their work and leave the tedious and time-consuming tasks to a well-trained machine.
All of this, though, depends on marketers educating themselves so that they can help their organizations invest in smart solutions. As AI evolves at a rapid pace, marketers will face increasing pressure to keep up.a
What: The use of AI on marketing and advertising is turning heads and generating headlines. The latest? Computers select images and colors, improve text, sift through big data to sharpen targeting and lift customer response rates. Why it matters: Agencies, however, say they deploy AI for more mundane but critical tasks. Those include automating repetitive work. They also encompass sorting and labeling images and videos. It saves thousands of hours of labor. As a result, it frees up in-house talent for higher-level creative output.
The brave new world of AI on marketing is here. Recent headlines boast of AI’s ability to boost customer response rates with better text, content and just the right selection of colors and images in advertising.
AI on Marketing Saves on Labor
Marketers tell Portada, however, that they’re using AI on marketing for far more mundane but still essential agency tasks. Namely, saving thousands of hours of labor and freeing up their best talent to do what creatives do best: create.
“Our initial goal is to automate several of the manual processes that go into the content creative process,” Carmen Garcés, head of digital at Hogarth México told Portada.
Hogarth Mexico, she said, is using AI or “machine learning” to mask, rotoscope, review, organize and tag hundreds of hours of video as well as images, saving the agency thousands of hours of labor.
Artificial intelligence is also being used to sort through Hogarth’s talent database of thousands of worldwide employees to help producers select just the right resources for each project.
The time saved frees up Hogarth Mexico staff to improve and apply their skills and technical knowledge to creative output, Garcés explained in an email.
“There are a lot of talented people around the world with unique creative and technical skills. We see AI as a great support to help us leverage this talent even further and to provide novel solutions and superior output for our clients.”
Apply AI on Marketing
Applying AI tools to recognize, catalog and modify visual content provides exciting opportunities for improving work efficiency and increasing advertising’s effectiveness.
Our initial goal is to automate several of the manual processes that go into the content creative process.
“One element of targeting that is still left relatively untapped is object recognition,” wrote Tim Bosch, associate director at Resolution Media in a recent column published by Digital Commerce 360.
“AI will be the driving force that exposes this massive targeting opportunity.”
According to Bosch, Snapchat has developed the technology to recognize objects posted by users, differentiating between food, pets, and more.
“Imagine this—after analyzing a user’s image inventory, object recognition technology could calculate their individual fashion style. This style feeds into their overall profile which brands can tap into to provide personalized ad messaging.”
Researching AI on Marketing
According to Garcés, Hogarth Mexico is “talking to multiple vendors and research institutes,” about how AI could help further improve the agency’s productivity. That includes using AI to modify videos and images.
“That would allow us to remove entire elements and objects from a scene something that if done in the traditional way could take days.”
Hogarth Mexico is considering AI tools that would allow it to change out the dialogue of actors in a video. It could then substiture “a completely different phrase or even deliver the speech in a completely different language.”
It’s undeniable that the unstoppable progress of AI has made it a tool that is impossible to ignore.
“The most important opportunity for us is to leverage AI to augment our talent. And amplify the creative output of our organization and provide superior customer experience while delivering content to our clients,” Garcés told Portada.
AI Frees up Creative Talent
At Grey Mexico, Chief Creative Officer Humberto Polar is focused on how to use AI to automate the generation of creative materials for advertising. He mentions combining of images and prices, and adapting formats in retail campaigns.
“This type of work today occupies many hours and is subject to a high level of human error. That’s precisely because it is operation-related and not creative work,” Polar told Portada.
“We should put our efforts towards automating tasks. Then people to do more much more gratifying and useful work, thus providing truly creative support to our clients.”
Grey Mexico is also using AI. Namely to analyze data, generating new understanding of the behaviors of consumers. With AI, the agency can apply its same creative thinking, but to much larger data sets.
“It’s undeniable that the unstoppable progress of AI has made it a tool that is impossible to ignore,” Polar says.
A summary of the most relevant consumer insight research in the U.S. and U.S. Hispanic markets. If you’re trying to keep up with the latest happenings, this is your one-stop shop.
Accenture’s13th Annual Holiday Shopping Survey of 1,500 U.S. consumers has found that Americans expect to spend $637 on holiday shopping this year, on average, with approximately six in seven respondents planning to spend either the same (57%) or more (28%) than they did last year. Consumers are expected to do half their purchases in physical stores, with lower prices cited as the top (82%) factor that would tempt them to make an in-store purchase.
For the first time, consumers in the U.S. might do more of their holiday shopping online than in physical stores, according to a new survey. In its annual Holiday Outlook, PricewaterhouseCoopers LLP found that 54% of respondents will opt for the convenience of their smartphones, laptops, and PCs, and even in-home voice assistants, compared to 50% last year.
CGS has announced findings from its 2019 CGS Customer Service Chatbots & Channels Survey. CGS surveyed more than 1,000 Americans and found that 86% of consumers prefer to interact with a human agent. Moreover, 71% of respondents said they would be less likely to use a brand if it didn’t have human customer service representatives available. Only 30% believe that chatbots and virtual assistants make it easier to address customer service issues. However, for respondents under 35, confidence in AI-based solutions reached 43%.
Recent research by Deloitte shows that consumers’ tolerance to advertising varies according to the type of shows they like. A new survey which polled 2,000 U.S. found respondents whose most-watched type of show was talk shows had the highest tolerance for advertising (11.6 minutes per hour), and the ones who prefer scripted comedies or dramas have the lowest (7.2 minutes).
According to the National Retail Federation’s annual survey of 7,400 U.S. consumers, 68% of Americans said they plan to celebrate Halloween. Sixty-nine percent declared they will hand out candy, while 49% will decorate their homes and 47% will dress in costume. In total, they are expected to spend US $2.6 billion on Halloween candy, about $25 dollars per person.
A recent CodeBroker survey of over 1,100 U.S. consumers on coupon and offer personalization found that sending custom offers to past consumers is a good opportunity for brands. The results show that 73% of respondents answered with a definite yes to the question, “Do you prefer to shop at stores that send you custom discount offers based on your purchase history?”.
We are introducing a bi-weekly summary of the most exciting recent news in marketing technology and trends. If you’re trying to keep up, consider this your one-stop shop.
Phrasee’s AI-powered Copywriting Tool Attracts $4M in New Funding
Investors will pour U.S. $4 million into the digital marketing software company Phrasee to power the expansion of its Artificial Intelligence tools that help brands like Domino’s and Virgin write better subject lines for emails. Brands also use Phrasee’s tools to write more effective Facebook and Instagram ads. The new funding will help Phrasee, based in London, to open offices in San Francisco.
Facebook is reportedly building a stand alone shopping app for Instagram, sources tell the media outlet The Verge. The app will allow Instagram users to use the app to buy goods from merchants they follow. Instagram is keeping mum about the new shopping platform. According to Facebook, there are 25 million businesses with accounts on Instagram.
Artificial Intelligence is rapidly changing how brands create content. The Tel Aviv firm Bidalgo has a new AI-powered tool that measures KPIs for the different elements of creative content, including words (messaging) and images (including video). MediaPost also reports that McCann Erikson Japan has launched the world’s first robotic creative director that analyzes key elements of past award-winning ads to then develop new ones.
The retail customer analytics firm Custora has won$13.75M in new financing for its software that uses Artificial Intelligence to help retailers segment and better understand their customers and as a result provide more personalized offers. Retailers also use Custora’s machine learning to analyze the impact of discounts and price points and forecast the lifetime value of each customer.
Investments in mobile advertising increased by 25% in the second quarter of this year compared to last, and more and more brands are choosing to place their ads within mobile apps, according to PubMatic’s Quarterly Mobile Index for 2018. In just the last year, spending on mobile video ads has increased by 239 percent, with a 688-percent year-over-year increase in advertising within mobile apps, the PubMatic release said.
The online flower delivery company Telaflora is using Artificial Intelligence to match offers to individual customers’ desires and preferences. Using AI tools from Bluecore and Custora, Teleflora succeeded in matching customer data with products to increase year-to-year sales by 50%, according to ClickZ.
We are introducing a bi-weekly summary of the most exciting recent news in marketing technology and trends. If you’re trying to keep up, consider this your one-stop shop.
LATAM retailer SACI Falabella will purchase the online retailer Linio for US $138 million. Linio operates in Chile, Peru, Colombia, Argentina, Mexico, Venezuela, Ecuador, and Panama. E-commerce in Latin America is expected to grow by 19% in the next five years – well above the global average of 11%.
Investors will pour US $4.5 million into the influence marketer FLUVIP to help it grow in Spain, Latin America, and the US. FLUVIP uses machine learning and predictive artificial intelligence to measure the impact and cost of influence marketer campaigns on social media platforms.
Your customers could be turned off if you only talk to them using artificial intelligence, a Capgemini worldwide survey of internet users has found. The survey saw wide acceptance among shoppers for AI interactions, but it also discovered that shoppers are happier when chatbots and virtual assistants come with live-human interaction options.
Compliance with the European Union’s General Data Protection Regulation (GDPR) is costing Fortune 500 companies US $7.8 billion, according to Fortune. A survey by PwC pegged the cost for 200 US companies of 500 or more employees at between $1 and $10 million.
A majority of US marketers view the European Union’s General Data Protection Regulation (GDPR) as a threat to their ability to target audiences. Digiday talked to 46 US marketers who said they were more concerned about restrictions on reaching key market segments than the cost of fines for noncompliance.
Conversions of inbound marketing leads into sales is a lot lower than you may think at just 13 percent according to a study by Implicit, as reported by PMG360. Look for a 20 percent improvement when you nurture inbound leads with personalization, targeted reach, lead scoring and timely response.
What: Alberto Pardo, Parker Morse, and Cesar M. Melgoza, founding partners of Portada’s Council System, gave us their views on how technology will help the evolution of marketing in the near future. Why it matters: AI is already impacting the media buying industry and it is expected to revolutionize the space with the automation of simultaneous processes.
Artificial Intelligence Will Increase Efficiency
According to a recent Salesforce study, 51% of the world’s marketing leaders (3500 participants answered the survey) are already using Artificial Intelligence in their organizations, and the technology has an anticipated YoY-growth of 53%. Moreover, 64% of these marketers agree that AI has “greatly or substantially increased their overall marketing efficiency”, and this technology is expected to grow more than any other.
“Everything will be about utilizing more technology, more data, more AI to be able to do things more efficiently,” asserts Parker Morse, founder & CEO of H Code, and member of Portada’s Agency Star Committee. “But it still needs to have people and the artistic touch of creating a creative experience that really engages the user, and machines can’t do everything. It’s about trying to find the balance between utilizing data and machines and the human element of creating the emotional connection with the user.”
Alberto Pardo, founder & CEO of Adsmovil, is pretty certain that “The future of marketing will absolutely be focused in three or four things: first, AI is going to change the way everything is done, everything we know is going to change in the near future because of the erosion or explosion of big data. Data is going to be more and more relevant and AI is going to be a very important part of it.”
Further, the member of Portada’s Council of the Americas asserts: “Second, mobile will have an impact everywhere. It’ll explode because of the 5G networks that are coming maybe this year or the next to Latin America and of course the U.S., so this’ll have a huge impact in the way we interact with mobile devices. I think video is also going to be very relevant in terms of investment, in the advertising industry, and there’s also going to be a big change in people’s roles, what people do today is going to change dramatically in the next 5-6 years.”
Data Helps Connect to Consumers
“What’s next is actually what I like to say is ‘back to the future’,” comments Brand Star Committee member Cesar M. Melgoza, founder & CEO of Geoscape, which was acquired by Claritas at the beginning of this year. “Connecting with consumers, engaging in very relevant, impactful ways will never go out of style, the question is how you do it, through which screen, at what time of day, in which context, and what that engagement results in.”
Connecting with consumers will never go out of style, the question is how you do it.
The amount of data will grow with every passing day, but marketers will need to increase the sensitivity that is needed to interpret it and make good use of it. To be effective, you need to create an emotional connection with consumers, which is impossible without the human touch, as other executives have expressed in previous marketer interviews. AI and big data are already shaping how marketing is done, the question is not “what will happen”, but as Melgoza says, how.