Survey: Multi-Location Brands Warm to AI, See It as Most Useful for Email

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Multi-location brands are almost twice as interested in exploring artificial intelligence for analytics as they were last year, according to Street Fight’s latest survey. However, AI still doesn’t crack the top five new local technologies in which they are interested, and there’s a significant disconnect between their perception of what’s most useful about AI and what suppliers of local marketing tech and services think about that same question.

The amount of hype surrounding AI can be frustrating, as vendors use the term inconsistently and seem to label anything that uses pattern matching or lots of data as AI. Chatbots and virtual assistants—that can legitimately claim machine learning as applied to speech recognition and generation—seem to have lost some steam. But it’s still rare to see a pitch for an analytics or marketing tool that isn’t “AI-powered.” Google, which knows what it’s talking about when it talks about AI, has some new local advertising offerings that sound a lot like A/B testing of semi-auto-generated ad creative. There might be some predictive interest analysis in there, as well. Adobe says it’s using AI for better email scheduling and targeting.

Street Fight regularly surveys both the buyers—enterprise local marketers and SMB local merchants—and sellers in the hyperlocal marketing and commerce ecosystem on what tactics and technologies are working for them and what they think is coming next. Our June survey of 205 local marketing managers and decision makers at big companies showed that interest in AI has increased since our 2017 survey. The figure below illustrates how many of our respondents said they were interested in exploring relatively new local technologies, with the option of choosing up to three. Less than one in five (18%) picked AI for analytics, but that’s up from 10% a year ago. Other AI-driven technologies like virtual assistants, voice search, and chatbots attracted single-digit responses.

The brands that were interested in AI analytics were similar to the other survey respondents in terms of size, revenue, and vertical industry. Last year, they were bigger companies, and fewer retailers numbered among them. The 2018 group is a little more likely than average to use digital techniques like monitoring reviews and social media, and they are more likely to do linguistic or textual analysis in order to keep track of customer sentiment and garner feedback. As for customer information, most of them (60%) collect point-of-sale purchase data and a higher-than-average 20% use third-party location data. They were more likely than other brands to use a third-party digital dashboard and/or reputation management services to manage their local marketing.

A larger share of that group said their local digital marketing was “very effective” compared to the average respondent, particularly in raising brand awareness but also in increasing lifetime customer value and doing service and support. They were heavier and more effective users of paid search and SEO, and said they were increasing spending on social media and mobile marketing. Social and mobile were the top targets for budget increases across all respondents, but a significantly larger portion of the AI fans are boosting that spending. 

Although you’ll see stories about AI-driven offers delivered by chatbots, it’s more likely that AI technology is used for mundane tactics like targeting and customizing email. In fact, when our brand survey asked where respondents thought AI and machine learning were most useful, email customization topped the list. As shown in the figure below, that was the area of least alignment between the brands and vendors and agencies we surveyed for our State of Hyperlocal report. Both groups listed customer segmentation and predictive purchase analysis in their top three. The vendors were more positive on recommendations and content generation than the brands.

The subset of brands interested in AI for analytics had the same top three as other brands, but they rated email, segmentation, and predictive purchasing equally (36% each). They weren’t much more excited about recommendations and content generation, either. Since nearly twice as many brands as vendors tabbed the AI-email combination, suppliers might want to adjust their pitches accordingly.

David Card is Street Fight’s director of research.

Click here to learn more about applying AI to customization at scale and customer engagement at the Brandify Summit: Building the Next Generation of Local.