Customer data is an essential part of your business, informing your daily decisions and helping you reshape your plans. After all, there’s no point in trying to serve your customers if you don’t know what they want in the first place. The rise of AI technology has made it much easier to collect, analyze, and act on customer data. However, these new market research methods raise some important privacy concerns that need to be considered. This article discusses the benefits and challenges of AI technology in market research. You’ll also learn how to reduce potential risks with simple tools, tips, and tricks that will help you reap all the benefits that AI has to offer.
Growing need for AI technology in market research
AI technology is revolutionizing market research, making traditional research methods like focus groups, surveys, and data analysis a thing of the past.
A Gartner study found that 79% of strategists believe AI is important to predicting success over the next two years. You must embrace these changes if you want to remain competitive.
But don’t worry. Although AI is sophisticated and rapidly evolving, gaining a firm foothold in the field is surprisingly easy.
Benefits of using AI in market research include:
Interactive data collection
AI technology has revolutionized the way marketers collect data. Paper records of surveys are no longer needed. He can collect and analyze almost all data in real time 24 hours a day. Some interesting ways to use AI for data collection include:
Chatbot: These can be a great way to engage your customers while asking and answering important questions. AI technology adjusts the tone of your replies, ensuring every conversation mirrors a real conversation.
Social media: AI tools can monitor online channels. You can also analyze interactions, demographics, reach and impressions, click-through rates, and more.
Quiz and poll: AI technology helps you brainstorm, schedule, and analyze fun, interactive polls and quizzes. These surveys are not only fun to answer, but they can also collect valuable data about customer demand, popular products and services, and more.
Personalized marketing campaigns
Data is useless if you don’t act on it. According to Salesforce research, 88% of customers say the experience their company provides is as important as the products and services they provide.
As more and more businesses move online, AI technology can be used to recreate the magic of in-person experiences in entirely new ways through personalization.
Personalization is when companies address customers’ needs, interests, demographics, and buying behaviors to provide customers with a one-on-one experience that fosters brand loyalty.
Here are some ways to use AI to create personalized experiences:
- Create a tiered loyalty program to encourage repeat purchases
- Offer discount codes for products your customers are really interested in
- Customize your mailing list to target your customers with customized offers
- When communicating, we will respond to each customer by calling them by name.
Predicted customer behavior
Market research is all about predicting customer behavior. Thankfully, this is where AI technology shines.
AI technology can analyze all the data collected and predict variables that can be used to improve the customer experience. For example, it can change based on customer feedback, identify commonly used vocabulary, and predict customer sentiment in question.
In this way, AI can provide a more comprehensive understanding of customer satisfaction. Tools can be trained to focus on everything from behavior to brand loyalty, short-term and long-term purchase intent, and more.
Challenges of using AI in market research
Of course, there are legitimate concerns about the speed with which AI technology can be used. Marketers need to be aware of these to keep their information safe. Consider the following:
Potential data breach
One of the biggest concerns about using AI technology is the potential for data breaches. After all, market research requires the use of vast amounts of confidential information about your company, customers, and competitors.
If you feed this information into an AI tool, you could be giving sensitive information to criminals who can exploit the technology. According to an IBM study, the average cost of a data breach in 2023 is $4.45 million, proving that not only your reputation but also your profits are at risk.
Thankfully, a variety of cyber security tools can help you reduce your risk and avoid costly cyberattacks altogether. The two most effective are:
Virtual private network (VPN): A VPN encrypts your internet connection and hides your online activities. This allows marketers to work on sensitive work files, such as customer data, without fear of being monitored.
Antivirus software: Antivirus software is essential to protect your business from cyber attacks. Regularly scanning and deleting infected files can prevent malware from destroying your research or stealing your information and demanding a ransom.
Compliance with privacy laws
As technology becomes more sophisticated, marketers must ensure that the AI tools they use to collect data comply with the law. Please note that you must comply with the laws of the country in which your customers are based.
The European Union follows the General Data Regulation (GDPR), which imposes strict regulations on data collection. Lawmakers agree that the use of AI technology falls under the GDPR in many cases.
The United States, on the other hand, does not have a one-law-fits-all approach. However, the President of the United States issued an executive order regarding the use of AI. It aims to set standards to ensure that AI systems are “safe, secure and reliable” and that the law “supports workers with ethical data protection”.
We still need a human touch
While AI is exciting and innovative, marketers need to remember that human input is still required to safely use these tools and achieve the best possible results. there is.
Humans are more socially aware of industry changes and have the critical skills needed just to collect relevant market data. AI tools can be just as helpful and successful as the initial prompt.
Human marketers are the brains of the machine, and asking the right questions can minimize their workload. A mixed approach, where technology does all the heavy lifting and humans do the thinking, is most effective.
Featured image provided by Pavel Danilyuk. Pexel; Thank you!
