Abstract
This entry will review the state of the art in AI, with a particular focus on applications in marketing. Based on the current capabilities of AI in marketing, the author's explore the new rules of engagement. Rather than simply targeting consumers, the marketing effort will also be directed at the algorithms controlling the consumers' virtual personal assistants (VPAs). Rather than exploiting human desires and weakness, marketing will need to focus on meeting the user's actual needs. The level of customer satisfaction will be even more critical as marketing will need to focus on establishing and maintaining a reputation in competition with those of similar offerings in the marketplace. This entry concludes with thoughts on the long-term implications, exploring the role of customer trust in the adoption of AI agents, the security requirements for agents and the ethical implications of access to such agents.
TopBackground: Applications Of Ai By Marketers
The term Artificial Intelligence (AI) was first coined in 1956, and has evolved over a half century of steady progress in building computers that can manipulate symbols (both logical and linguistic). In the mid 1990’s, with the commercialization and diffusion of the Internet, exponential growth in computing power and advanced software sophistication fully functional intelligent agents have come to pass, and the term “intelligent agent” has been formally defined:
An intelligent agent is software that assists people and acts on their behalf. Intelligent agents work by allowing people to delegate work that they could have done to the agent software. Agents can, just as assistants can, automate repetitive tasks, remember things you forgot, intelligently summarize complex data, learn from you, and even make recommendations to you. (Gilbert, 1997)
Whether termed an agent or assistant or defined as artificial or virtual, these emerging applications are an amalgamation of many technologies – voice recognition, linguistic sciences and natural language processing, machine learning, cognitive computing, analytical and predictive statistics, neural networking, and deep-learning algorithms.
Marketers are currently utilizing an array of advanced AI platforms, services and technologies. The scope of activities and functions that AI is already being applied includes:
Key Terms in this Chapter
Intelligent Agent (IA): An artificial intelligence system, possibly endowed with human-like personality traits and with the ability to recall context and history of interactions in a manner that would facilitate future interactions with a human being.
Virtual Personal Agent (VPA): Intelligent agent that is intended to assist a human user with purchases over time, developing a relationship and a context that optimizes the communication with the human user; for example, the VPA could remember the preferences of the human user and would be able to reorder items from a favorite brand or to suggest brands that would best meet.
IBM’s Watson: Artificial intelligence system originally designed to showcase AI efforts at IBM by competing in the Jeopardy game. After winning Jeopardy in 2011 against the then-current champions, Watson was marketed by IBM for applications in medicine, customer service and general problem solving. Currently, Watson is being developed into a general purpose AI system that has been opened to a community of beta tester.
Artificial Intelligence: A computer system designed to exhibit features of human intelligence, including for example being able understand questions via natural language (human speech), solve complex problems and present reasoning, and output answers using natural language.
Marketing Recommendation System (MRS): Computer system using AI or similar technology to make product, brand or feature recommendations to customers. Some current systems have emerging abilities of this nature, but true AI systems are expected to provide insights much closer to those of expert sales staff.
Siri: Apple’s personal assistant on the iPhone/iPad/iPod platform, able to understand and respond to basic questions using natural language using AI in the cloud. While Siri was one of the first AI agents in general use, its capabilities are rudimentary compared with those expected of true AI systems.