Dall-E 2 is less than eight months old, ChatGPT is less than three months old and Microsoft’s Bing, with AI tech behind ChatGPT, has only been open to the public for a few weeks. Change is hurling itself at you. It can be exhausting especially if you’re in digital marketing. Reaching consumers and achieving success is more difficult than ever before, thanks to platform restrictions, cookie deprecation and iOS updates. To make matters worse, the cost of media is prohibitively high. Artificial Intelligence (AI), particularly Generative AI, is transforming the digital marketing space. It poses new challenges by disrupting content creation and search, whilst also AI enables digital marketers to work smarter, faster, and more efficiently than ever before.

CX Takes the Center Stage in the face of growing privacy restrictions

As privacy laws tighten and cookie deprecation approaches, marketers are facing a watershed moment in 2023. Marketers must determine how AI fits into their privacy plans as we move away from third-party data and towards a cookie-less world. This means that investments in marketing operations, analytics and technology that uses AI to optimise bottom-of-funnel efforts should increase. Marketers are looking to reap the benefits of AI Algorithms that can identify patterns in large datasets to create more targeted and effective campaigns through contextual advertising and real-time campaign optimisation, which traditional analysis cannot do.

It is critical for brands to strengthen their customer relationships by improving customer experience (CX). The proliferation of chatbots to handle routine queries has freed up human agents to handle more serious issues. This is improving further with advanced conversational agents built with LLMs (Large Language Models) and RLHF (Reinforcement Learning from Human Feedback), such as ChatGPT. LLMs are also enhancing the search and recommendation experience on product catalogues. Furthermore, organisations must have real-time insights into the pulse and needs of their customers. Accelerated implementations, aided by AI platforms like Merkle’s JARVIS, are providing businesses with a decisive advantage in enabling enhanced customer experience.

AI Chatbots are Revolutionising Search

Perhaps the most significant paradigm shift is taking place in search. Businesses that rely on SEO as their primary acquisition strategy must adapt as well. In an interview, Microsoft chief executive Satya Nadella stated, “From now on, the gross margin of search is going to drop forever.” ChatGPT has seen record-breaking adoption, with over 100 million active users in the first two months of its launch. Microsoft’s Sydney, Google’s Bard, Baidu’s Ernie, and other ChatGPT-style agents will drastically alter search and SEO.

Given that these agents rely on reinforcement learning (RLHF), it makes sense for businesses to keep their best ideas away from web-scrapers, resulting in an increasing amount of gated content, such as private messaging lists and communities.

One issue that these agents are currently experiencing is that they occasionally return results that appear correct but are actually incorrect. Products like neevaAI are attempting to include a fact-checking component by returning web citations alongside the results. Furthermore, these agents can now be hacked and have bias issues, but as with any technology, we can expect these issues to be resolved through human feedback, censorship, and influence cycles.

In a cookie-less world, when the search is disrupted by models capable of synthesising information in a conversational fashion, channels such as social media influencers, who already have access to a large audience, will be much more powerful than they are today. This would also imply that brands would need to respond fast to de-influencing trends, which would be enabled through real-time sentiment tracking via AI algorithms.

Is this the end of search? Although many people are convinced that SEO will die, it is unlikely for three reasons. First, search includes the most recent results, second, it gives a point of view, and third, the cost of trustworthiness of search results makes it a profitable channel for marketing.

AI is Changing How Marketers Create Content

AI solutions that can identify themes and content that are likely to engage clients are flooding the market. Tools like ChatGPT, allow creatives to begin with some base content rather than a blank slate. At the moment, it’s just a parlor trick, but these systems will evolve over time to adapt to different styles and briefs. By being part of the idea board, generative art tools like DALL-E, Midjourney, and Stable Diffusion are already becoming a part of the creative workflow. These tools are not perfect and may only be used to generate ideas. They are also facing legal hurdles.

Nevertheless, AI isn’t the panacea for all problems that marketers face. There are risks and limitations, like with any technology. Responsible and ethical use of AI should be the priority, not an afterthought. Marketers must ensure that these models are performing as intended and are not amplifying bias.

AI will inevitably transform the digital marketing landscape, as well as virtually every other business. Accepting this transition will allow marketers to recognise opportunities for analysing customer data, creating content and automating their workflows, allowing them to stay ahead of the curve.