AI 101: Using AI to Segment & Personalize

AI can help businesses augment their team by taking on a number of tasks. For example, AI can more effectively segment target markets and create personalized marketing messages for different customer groups based on their behaviors, preferences, and needs.

Here are some real-world examples:

Customer Segmentation

Consider a business that sells eco-friendly skincare products. They have a broad customer base and want to understand how to market to each customer more effectively. By leveraging AI, they can analyze customer attributes like age, location, and skin type with past purchases.

AI can identify patterns and create distinct segments, like Customers aged 18-25 interested in skin care for oily skin or Customers who only buy during sale periods. From here, marketing strategies can be tailored to these specific segments, improving the return of each marketing campaign.

Personalization

Now, let's take the example of a business that operates an online bookstore. They want to improve their customer's experience and increase weekly sales. By leveraging AI, they can create personalized experiences for each customer.

For instance, if a customer has a history of purchasing mystery novels, the AI can suggest similar books in this genre. If the customer starts browsing cookbooks, the AI system can adapt in real-time and start recommending popular or highly-rated cookbooks.

Moreover, the AI could personalize their email marketing based on these preferences. A customer who reads a lot of science fiction might receive newsletters featuring new releases, author interviews, or discounted prices in the science fiction category. This level of personalization makes the service more valuable, saving the buyer time, and connecting them with products fitting their needs. The net outcome is a loyal customer and an increase in sales.

In both these scenarios, AI helps remove the time-consuming element of the task at hand and increases the effectiveness of both the journey (how quickly you get to the desired outcome) and the outcome itself.