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What data-driven strategies can businesses use to achieve growth using AI

This article originally appeared on Financial Express.

In the dynamic world of eCommerce, attracting new customers remains a foundational goal for every business. However, as consumer preferences shift and the ecommerce landscape expands with more and more businesses selling online, the old traditional methods of customer acquisition no longer work as effectively. 

Businesses across industries have reported a drastic increase in customer acquisition costs across channels owing to limited targeting capabilities offered by them. This has resulted in higher spends on customer acquisition with lower returns on the investment, leading to business burn for most. 

The modern approach calls for leveraging advanced, data-driven techniques, ensuring the insights available across platforms can be consolidated to create comprehensive growth strategies. 

Businesses are surrounded by an abundance of data sources, from website analytics and marketplace stores to social media and transactional data. These provide valuable insights into customer behavior, preferences, and buying patterns. 

However, the challenge lies in the fact that these insights are reactive. They tell us about an event that has already occured – a site visit, a purchase from a marketplace listing, etc. While the data these events provide give brands a direction to reach their customers, it does not equip them for the change that comes right after. 

The lack of prediction in the data available makes it harder for brands to run data-driven campaigns based on ‘current’ demand. 

By integrating AI, businesses can analyze data in real time, allowing them to be proactive rather than reactive. This real-time analysis opens the door to optimizing strategies on the go and adapting to ever-changing consumer trends and preferences.

Take customer segmentation, for example. Imagine being able to run campaigns that are not just targeted but are precisely crafted to resonate with each customer segment’s unique characteristics. The messaging, visuals, offers, and even the channel through which the campaign is delivered are all meticulously selected to appeal to the specific segment, ultimately driving higher engagement rates and conversions.

AI helps to categorize customers more accurately, leading to better-targeted campaigns. This precise segmentation enables hyper-personalization, where campaigns are not just tailored to the audience but are customized to meet the specific needs and preferences of each customer segment.

AI-driven hyper-personalization enables businesses to be more agile in their marketing efforts. As customer behaviors and preferences evolve, AI algorithms can adapt in real time, ensuring that campaigns remain relevant and effective. This agility is crucial in today’s fast-paced digital world, where customer expectations constantly evolve, and the ability to stay ahead of the curve can be the difference between success and failure.

Another eCommerce application, product analytics powered by AI delve deep into your inventory, providing a clearer and more comprehensive picture of what products are performing best, which are in demand, and at what price points. These insights are invaluable, as they directly inform a range of strategic decisions. With precise inventory management, businesses can ensure that their most popular products are always in stock and readily available to meet customer demand. This not only enhances customer satisfaction but also prevents lost sales opportunities due to stockouts.

Moreover, AI’s data processing capabilities allow businesses to monitor campaign performance in real time. This means they can double down on strategies that are working and eliminate those that aren’t. Everything from offers and creatives to ad targeting can be optimized for maximum impact, helping achieve higher ROAS. 

Pricing is another area where AI can make a significant difference. By analyzing data on customer behavior, market trends, and competitor pricing, AI helps businesses set prices that are competitive yet profitable. Using this proactive data-driven approach is especially important when offering discounts and promotions, ensuring that the bottom line is not affected during peak sales season. 

The future of data-driven marketing lies in the proactive analysis of insights available across multiple customer touch-points. 

It’s important for brands to acknowledge that consumer needs are continually evolving, and the only way to meet them is to be able to understand every interaction they make with the brand across multiple channels. 

The one strategy that businesses of all scales need to grow sustainably in a competitive market is using data proactively. 

Embracing technology like AI to derive consolidated actionable insights is a must-have for fast-moving markets, where customer acquisition, engagement and retention move hand in hand. 

Authored By Prem Bhatia, Co-Founder and CEO, of Graas.

Prem Bhatia

1 Jan 2024

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