Artificial intelligence can glean insights from data, but only humans can understand context and create innovative concepts.

Kevin Cochrane, BloomReach

Kevin Cochrane, chief marketing officer, BloomReach

Can you comprehend the idea of 100 billion connected devices or that one billion digital natives will join the workforce in the next seven years? It’s an unbelievable reality that those who market products must face in today’s hyper-competitive digital landscape, something that seems insurmountable to scale (both figuratively and literally).

Every day it seems a new digital channel opens, offering your competitors a fresh channel to connect with your customers, while offering you a fresh platform about which to learn and strategize. From the fairly trendy and yet-to-be proven chatbots to the vague-sounding augmented reality (AR), these digital touch points and corresponding data streams threaten to further fragment a 360-degree view of each customer’s journey. And, it’s imperative to understand and deliver that 360-degree view, because digital experiences like Google have trained your customer that they are of unique importance.

Yes, customer intent is a snowflake, and just like a snowflake, the slightest friction will cause it to disintegrate. In short, retailers are now selling to segments of one. So, in comes artificial intelligence, its quadrillions of computations and learning algorithms crunching away to make correlations that weren’t humanly possible.

It’s easy to understand the hype and confusion in the retail community right now—AI and the technology needed to understand, process and monetize it are increasingly important to compete in today’s marketplace. Where would we be without the machines, the computer software, or the seemingly incomprehensible mathematical algorithms that power our digital world? But, have the majority of those leading digital transformations figured out how to weaponize it yet? One thing we know: marketplaces-that-shall-not-be-named are on top of it.

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It turns out that the truest and greatest tool for a retailer to weaponize that all-powerful sentient algorithm is still “HI”: human intelligence, that is. Currently, AI can handle only what it takes the human mind a second to comprehend, but the argument goes that AI can execute that “second of thought” at a tremendous scale. But, sometimes a more nuanced human mind—with its contextual and critically thinking power—can make a decision that yields just as much return from one or two decisions as a machine that makes a thousand in a day.

A New York Times article by Steve Lohr dug into this deeply, mentioning that algorithms are growing ever more powerful, fast and precise, but computers are still literal-minded and lack strong capacity for context and nuance. It’s why, I’d argue, that the most important thing needed to evaluate AI is its ability to understand language. In this hyper-personal and hyper-evolving digital consumer landscape, nothing is more personal than language. But, I digress.

Human ability to understand nuance makes it the ultimate quality-control specialist.

However, for retailers to be successful in their AI strategies, they need to understand that we are in the third wave of digital marketing, where it’s paramount to bring the power of human relationships into brand experiences. And, while technology is allowing us to emulate that potential at scale, it is still a skill where humanity remains supreme. The questions for retailers are: “What can human capital do best?” and “How do we unlock this power?”

The answer to the former is simple: create and ensure quality. One of the most-engaging things that any organization—and especially retailers—can do to differentiate themselves is not just the products it offers, but content that support its offerings. At a time when it’s almost impossible to compete on price and fulfillment (not to mention the customer precedent and death spiral that discounting initiates), retailers must give their customers other reasons to engage their brands. They must discover content that converts. Resources like a men’s suit guide, REI’s e-commerce content marketing, or any of these other examples highlighted by CIO Magazine were conceptualized and created by humans to communicate to humans. Similarly, while machines are doing some journalists’ work, I can’t say that I got much contextual value out of those articles beyond the who, what, when and where.

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Secondly, AI is not perfect, and human ability to understand nuance makes it the ultimate quality-control specialist. There are plenty of examples of AI failures, and brands that have them are 100 percent responsible for the consequences. Just because a plane can land itself, does that mean it’s enough for you to fly on it without a pilot? Even if the mistakes aren’t catastrophic and are just slightly off, every retailer knows the (no) tolerance level exhibited by today’s digital customers.

So, how do we unlock and amplify our human potential? Look at the problem. One of the main, underlying roadblocks for retailers in today’s market is the inherently evil fact that time is limited. What is the main reason that consumers like personalization? It saves them time. Why do they prefer to shop online rather than in a store? Time. Why didn’t you find and fix every dead-end link or query redirect on your site? No time.

While Albert Einstein challenged the notion of absolute time, even he wasn’t completely successful, which means that there’s not much that we non-world-class physicists can do. However, if one of the answers to time limitations of consumers was to orient the experience around them uniquely, maybe the converse is true. Maybe empowering human intelligence within retailers is about orienting the experience around each function uniquely. Instead of increasingly turning to Google Analytics for deeper and more detailed insights and for goal-setting then triangulating with data, maybe it’s time to reorient human capital around the search for insights that are prescriptive. It is in prescription that human intelligence has a penchant for action and unlocks the power of greater creativity. It doesn’t remove the roadblock of time, but it condenses it.

Case in point are digital merchandisers, a group of professionals not only trained to have a sharp talent for analytics but also a keen eye for emerging trends. There’s no doubt that AI can pick up on trends increasing in velocity, but often the most effective operations are ahead of the trends, anticipating an upswell in demand. Human intelligence has the ability to quickly identify opportunities based on external experiences and context—beyond the data points—and place content or product bets accordingly. Admittedly, it’s probably less accurate in aggregate, but being ahead of one trend can make a brand, building a fiercely loyal customer base.

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Secondly, let’s go back to my quality point. A retail marketer may want to use AI to mine query data to wholly automate category-page creation, but many times the ways that consumers search for products is not the way you’d want to sell them. A human mind can anticipate and adjust for cultural sensitivities or things that are downright offensive. We have seen multiple examples where automation could be to blame for marketing run amuck, and while it’s likely that consumers used certain terms to describe products, that by no means is the way you want to present your brand experience.

Another area where retailers should heed caution is with chatbots. No doubt they’re the thrill of the moment, but many companies have reported high failure rates. It’s important to remember that e-commerce competition is at an all-time high. Many times consumers are going back to certain retailers because of the experience provided, with the convenience only serving as part of the equation. Chatbots might seem like an efficient way to handle both cost effectiveness and deliver good experiences, but one breakdown can have a cascading effect on customer retention and loyalty—which are already challenging in today’s market.

Consumers today are craving a more personal experience, which is why personalization is the talk of every conference and the number-one priority in many studies. However, delivering personalized experiences isn’t always about relevance and convenience. It’s also about connecting brands with customers on a personal, emotional level, and the marketing content that we target them with should reflect that. It may be easy to use AI to mine data and automate “personalized” email or social marketing campaigns, but people often know when they are talking to machines. Brands—and especially retailers—need to keep that human touch in both the content they create and the campaign tactics they execute if they are to communicate effectively and engage with their customers.

All of the above mentioned examples can be powered completely by AI, but still should have a place reserved for human intelligence. Machine intelligence should be prescriptive—guiding its human overlord to priorities, telling them where to go and what the anticipated result should be.

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There’s no doubt that AI will become increasingly useful; however, anyone worried about a machine takeover should know that the greatest asset any retailer has is still its human capital. We’ve seen countless digital reformations and automation over the past 20 or so years, and every single time we also see people’s ability to adapt and push the boundaries of creativity in concert with machines. The real formula for e-commerce success is still humans plus machines, and so it will be with the rise of AI.

Bloomreach provides search marketing services to 25 of the Top 500 online retailers in North America, according to Top500Guide.com.

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