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Artificial Intelligence in Marketing

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Artificial Intelligence in Marketing
Sri Pravallika Devarapalli
Msc Data Science & Artificial
Intelligence
Department of Computing
Bournemouth University
Bournemouth, United Kingdom

Abstract— Artificial Intelligence (AI) has become a rising There are some advantages and disadvantages in combining
trend in science, business, education, medicine, and Artificial Intelligence with Marketing.
automotive. Now, it reached marketing as well [25]. The rapid
development of AI presents exciting opportunities for
marketing and research [31]. The purpose of AI in marketing A. Advantages
is to predict the decision of the next purchase and improve
• AI streamlines the marketing efforts by identifying
their consumer journey. The core components of AI are big
data, machine learning and powerful solutions [12]. These the user’s behavior and foresee the customer
components reveal the power of AI: requirements.
• With the help of Artificial Intelligence, we can
1. The marketers use the concept of big data by eliminate mundane, time-consuming tasks, and this
aggregating and segmenting the vast amount of data will help the marketing and sales team to focus on
with less manual work [12]. This segmented data will more productive tasks [4].
deliver the content to the consumers at a perfect time.

2. Marketers can bring valid implications from a vast B. Disdvantages


number of datasets to predict the behavior of the
consumer and their next purchase with the help of
• Artificial Intelligence only makes decisions based
Machine Learning (ML) [12]. on logic, and this may seem callous to the
customers [4].
3. Making powerful solutions implies that we live in a • Customers would still prefer human interactions
modern age, where machines can think and [4].
understand the same way humans do [12]. Based on
the availability of the data, machines can easily AI gained that importance in marketing because of the rise
interpret the behavior of the consumer by generating in computing power and reducing its costs, availability of
satisfactory responses to the consumers [12].
big data in the market and usage of advanced models and
Practitioners from worldwide are trying their best to fit the algorithms of machine learning [24]. As a result, there are
marketing functions into AI solutions [46]. ample applications in the areas of marketing. For instance,
firstly, Amazon.com's prime Air practices with drones to
Keywords— Artificial Intelligence, Marketing, Big Data, mechanize the shipping and delivery of the goods to the
Machine Learning (key words) consumers [24]. Secondly, for delivering pizza to the
customer, Dominos is trying to use autonomic vehicles and
I. INTRODUCTION robots [24]. Thirdly, Albert's marketing platform is used by
“Marketing is the management process responsible for RedBalloon to attract new customers [24]. Fourthly, Macy's
identifying, anticipating and satisfying customer "On Call" is an in-store personal assistant that uses Natural
requirements profitably” [2]. Artificial Intelligence attempts Language Processing (NLP) to resolve the general queries
to understand human intelligence and build intelligent of the customers [24]. Fifthly, Lexus uses AI applications
entities [37]. In recent years, artificial intelligence has been for marketing. To write the TV commercial scripts, they
integrated into almost every major field such as business, used IBM Watson [24]. Furthermore, they used Affectiva
medicine, education, science, engineering, and for affective analytics, which recognizes the emotions
entertainment. AI has the full potential to develop and make through facial and vocal expressions while watching their
an enormous impact in three business areas [16]. The TV commercials [24]. Finally, a chatbot called Replika runs
modules are Marketing, Sales and Customer service. with a Machine learning Algorithm that gives emotional
1. Marketers seek to use AI to optimize the impact of support for the customers by mimicking their
considerable investment in AI to improve the communication styles [24]. According to Davenport. (2020),
marketing impact in media, content, products and Rust, (2020) have stated that there will be substantial growth
digital channels. in marketing with a combination of Artificial Intelligence.AI
2. Sales organizations uses algorithms that can be used in Marketing to expand business growth and
recommend the content, which leads to continuous improve customer satisfaction. It also has heavy potential to
sales performance. drive revenue and grow company profits. AI in marketing is
3. In customer service, AI provides automation, illustrated in figure-1.
sentiment analysis, Natural Language Processing
(NLP) and personalization to manage customer
relationships.
Big data gather every piece of information, from
doing business to shopping in the store and purchasing
movie tickets. Each category of the information is
segregated for analyzing the purchasing decisions of the
consumer [12].
The requirement for mobile phones around the
world has increased. There are 4.6 billion subscribers for
smartphones. Among those, 1 and 2 billion are using the
internet. People's need for mobile phones and the internet
clearly defines modern technology, and AI is highly used
[41].

III. LITERATURE REVIEW


Artificial Intelligence arrived from human intelligence,
and AI is demonstrated through machines. Artificial
intelligence is defined as an environment involving
intelligent machines with a system that achieves its goals,
according to Russell and Norvig (2002). Artificial
Figure-1 AI in Marketing Intelligence has developed to an outstanding level in recent
years due to years of professional work [46].

Data ingestion works a significant role in artificially


intelligent systems, as it works with massive amounts of
data. These Intelligent systems consider the data based on
Marketing Mix their analysis and requirement [46]. For example, there is an
enormous amount of data in the organizations like Google,
The marketing mix concept was devised by Amazon which is difficult for humans to analyze. Apart
McCarthy, a conceptual framework that translated from this, Artificially Intelligent systems stores information
marketing planning into practice [5]. First, McCarthy about numerous people and their addresses from multiple
reorganized Neil Borden's idea of fulfilling the target market sources [46].
into four elements by regrouping 12 elements as (product
planning, pricing, branding, channels of distribution, Use of AI in Marketing
personal selling, advertising, promotions, packaging, Natural Language Processing (NLP) with AI-driven
display, servicing, physical handling, fact-finding and chatbots helped most marketing organizations and
analysis) into 4Ps (product, price, promotion, place). In customers resolve their issues or frequently ask customer
subsequent years, refinements such as adding P's (people, queries through these chatbots [7]. The data processing will
processes, physical evidence) to this marketing mix concept be done efficiently using AI and ML algorithms, allowing
have been made [6] even though the concept of 4P's remains the developers to make correct decisions [28]. AI
popular today [25]. Applications can analyze the customer's interest's like
purchases, habits, frequently bought items, and the customer
likes and dislikes and filter them accordingly [7]. Artificial
II. BACKGROUND Intelligence User Interface (AIUI) is supported to customer
Technology has enhanced and incorporated into Relationship Management (CRM) functions [40]. AI and
our daily activities in the last two decades, generating IoT converted the Customary retail stores into Smart retail
massive data every day from our smartphones [39]. This stores. Customers ease of shopping has enhanced and better
data will help marketers to enlarge the methods of research supply chain because of the smart retail stores. Nazim Sha
using AI and big data [11]. In addition, using smartphones and Rajeswari have mentioned the advancement of AI,
made life easy for people to get in touch with other people, which can track the five senses (smell, taste, vision, touch,
resolve any issues, register with other companies [20,21]. hearing) [32].
All this data is plentiful, as every mobile device connected A. Strategy and Planning
to the internet is rising each time, reaching 3.5 billion
around the world in 2018[43]. Moreover, the searches made In segmentation, targeting, and positioning (STP),
in Google's web search engine for a year are around 1.2 artificial intelligence is used by marketers in strategy and
trillion searches, approximately 40,000 searches per second planning. Moreover, algorithms like Machine Learning and
[44]. The word big data arrived from these massive amounts Text Mining can be used in different areas like retail and
of information stored in data center’s [13]. Businesses take tourism, finance and banking, and art marketing
this data to enhance their services by interpreting the [10,33,34,45]. Furthermore, the targeted customers can also
customer need from the data [27]. This data can be managed be condensed using techniques such as machine learning,
only because of the technology in recent years and the data optimization, and causal forests [8,42].
evolution of Artificial intelligence to treat vast quantities of
stored information [17,22].
B. Product Management Yong-Hak, (2013), Scopus have more than 20,000 peer
Products are designed based on customer needs and with reviews journals from different publishers, which have
its suitabilities using Artificial Intelligence-based marketing broader coverage [15,47].
analytics tools, resulting in customer satisfaction [10]. In
addition, topic modelling helps in the design and innovation B. Search Strategy (Defining Keywords)
of system capabilities [1]. When consumers search for
The initial search for this topic would be "marketing"
products, they assign weight preferences as attributes. This
and "Artificial Intelligence". The synonyms used for the
assists in understanding the product recommendation
word Artificial Intelligence are Machine learning, Natural
systems and aligning marketing strategies for meaningful
language processing (NLP), deep learning etc., and these are
product management [14]. Deep learning can assist
used with boolean operators like 'AND' and 'OR' [46]. The
individuals in discovering their areas of interest by allowing
Boolean operator 'AND' is for the intersection of a
them to explore new places. In addition, the application of
collection of articles and the 'OR' operator for a universal
artificial intelligence will enable companies to customize
group of articles enfolding marketing and artificial
their offerings based on customer needs [40].
intelligence [46].
C. Pricing Management
C. Inclusion and Exclusion criteria for results
There are multiple factors to finalize the price of the
In search results, the criteria of Inclusion and exclusion
product. First, there will be real-time price variations based
can be applied. For achieving the research objective, the
on demand fluctuations, which adds to the complexity of
search results are limited to the articles published in
fixing the price. Second, the price adjustment can be
journals, which conveys "Certified Knowledge" [35].
dynamically based on the real-time scenario's using a
multiarmed bandit algorithm [29]. Third, there will be
frequent price changing strategies in e-commerce portals; D. Data Analysis Plan
the price points can be adjusted quickly by applying There are three stages for structures Data Analysis.
Bayesian inference in the machine learning algorithm. Stage 1 is for the data analysis for the performance of
Finally, the price will match the competitor's price [3]. scientific actors in the research domain, which focuses on
the most relevant sources and authors in the research
D. Place Management domain [46]. In Bibliometric Analysis, the performance
evaluation of scientific actors is based on the citations and
In the marketing mix, the main fundamental components
citation index. Stage 2 is for conceptual and intelligent
are Product access and product availability to enhance
network analysis of co-occurrence and co-citation analysis
customer satisfaction. Product distribution relies on several
[46]. Stage 3 analysis in marketing is focused on occurring
parameters like logistics, inventory management,
tendencies and future research directions of AI [46].
warehousing, networked relationship, transportation
problems, primarily mechanical and redundant. Artificial
Intelligence will give the ideal answer for place E. Identification of research gaps and their future
management by providing IoT for order tracking and order directions
refilling, cobots for packaging and drones for delivery [24]. To understand the evolutions methodologically and
theoretically, and for emerging research themes, the related
E. Promotion Management articles of artificial intelligence in marketing are reviewed.
Thematic coding is used for qualitative data analysis, which
Promotion management requires search engine
analyses and identifies the common theme or idea in
optimization, media planning, advertising campaign
passages or images. This data is indexed into categories for
management, media scheduling, and promotion tactics are
the outcome of the thematic framework [46].
transforming from physical to phygital. The worldwide
digital transformation is because of inroad campaigns of
digital marketing and social media. The decision of the V. FINDINGS & DISCUSSION
content, place and timing in this changing technological
world is controlled by the customer's decision.AI offers a A. Marketing Implications
personalized and customized message based on customers' The authors conducted an analysis based on the
likes and profiles [24]. implications of AI in marketing and gathered examples of
made synthesis of how it reflects the marketing mix. As a
IV. METHODOLOGY result, conclusions are conferred in table 1 [25]. Each
instance derives the impact of AI in each area of the
In the Literature review, the guidelines given by Rowley marketing mix. This finding is significant in developing the
and Slack's (2004) are used in this article. Methodologically, whole spectrum of marketing activity with AI influence,
the five-stage process in the literature review describes in which will help practitioners [25]. The implementation of
the following sections [46]. AI can be done within 'product' and 'promotion' areas in the
A. Bibliometric Database Selection marketing mix program [25].
Scopus and Web of Science (WOS) are selected as the
Table 1 Artificial Intelligence areas of impact on marketing
top two reputable bibliometric databases. According to
mix [25]
c. Customer-Brand Relationship
We can reduce the possibility of post-purchase
dissonance by enhancing consumer-brand
Product Price Promotion Place interactions. This allows the products to be tested
Price virtually, eliminating the learning process associated
Development of
management Forming a
Automatic
with categories and comparing themselves to others
matching to the unique [25].
new product purchase
customer experience
profile.
Building Minimized Merchandising C. The Implications involved with the use of AI on
Additional value disappointment automation Marketing Management
AI has a practical impact on current practices in terms of
Creating the marketing management, and there should be a new way to
New
Hyper- wow facet and the chores that fulfilled in marketing teams:
Distribution
personalization delivering
channels
benefits.
a. Elimination of toilsome and Time-wasting activities
Repetitive tasks like data collection and analysis,
Further solutions Favorable
Convenient
image processing and search etc., will be automated
exceeding influence on with the help of Artificial intelligence [25].
shopping
product category the customer
b. Tremendous implications of creative and strategic
activities
Automatic Customize 24/7 chatbot The role of creative and strategic activities
recommendations communication service
performed with precise analyses using AI will build
Learning the competitive advantage [25].
process Faster and
elimination in simpler sales
c. Creative Designs
product process With the help of AI, the customer is receiving their
categories values, and through design, there is an increase in
Consultant-free finding new solutions [25].
customer
support
d. Acquiring new capabilities in the marketing team
Quicker and
easier sales The marketing team comprehends the latest
process technological prospects with the help of AI. In
addition to that, AI integrates the skills used in data
science into the marketing team [25].
The analysis conveys that AI activities have a two-way
impact on marketing. On the one hand, the consumer is the Unexplored way of marketing ecosystem: The
beneficiary of changes. But, on the other hand, whole intricacy of Artificial intelligence enhances the part of
pursued marketing activities affect new solutions [25]. companies building AI solutions. Because of the current
level of AI progress, there is a requirement to design a new
model which offers Machine learning tools with AI entities
B. Influence of AI on Consumers [25].
The Internet brought vast benefits in terms of customer
point of view, such as suitable product suggestions and
automatic recommendations [18], less shopping time [30],
or customer service customization [26], Artificial VI. CONCLUSION
Intelligence took one step forward and offered new The research confirms that the Application of
opportunities in marketing activity. The examples shown Artificial Intelligence is applied in many areas of marketing.
below clearly define that the application of AI in marketing The marketing solutions based on it took benefit in five
shows the broad picture of the advantages that the areas of Artificial Intelligence: text recognition, voice
consumers are gaining from AI [25]. recognition, image recognition, autonomous vehicle, and
robots [25]. Among all these, decision making, text
a. More Convenience recognition, and image recognition were applied vastly in
The shopping time is flexible and faster, and the marketing. However, the practical application of voice
payments are automated. There is a better quality in recognition models is quite rare and developed by the
search engines. Customer service will be there 24/7 biggest tech firms like Amazon, Apple, Microsoft, and
[25]. Google. In the same vein, autonomous robots and vehicles
are much more connected to Industry 4.0 than creative
b. Hyper-Personalization design within the marketing mix [25].
Customers are getting experienced via mass-scale Based on the analysis and the examples discussed,
hyper-personalization; once the sales are made, the the quality of a consumer's life increased with the
product gets additional value [25]. application of AI in marketing [25]. Therefore, the
marketing organization benefits from the application of AI. network process. International Journal of Consumer Studies, 43(4), 358-
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Artificial intelligence in marketing: Systematic review and future research

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