For Retail Marketing, 2018 is a Time to Evolve

Every retail marketing professional has faced the same question in recent years, as artificial intelligence and machine learning have become an increasingly dominant force: How will my capabilities and skills fit into this new, digitally-driven, data-enhanced, AI-obsessed landscape?

The days of traditional marketing are long gone, and AI is reshaping the skills marketing requires and the strategies that will bring the most success. We will take a look at some of the ways this shift will challenge marketers and retail marketing departments in the New Year.

Marketing Team Makeup Changes Drastically

2018 will see retail marketing departments undergo an organizational change, moving away from a channel-oriented structure (with independent teams for SEM, display, email etc.) toward groups that bring together creative folks with data-savvy “marketicians”. Fueled by the continued adoption of marketing automation platforms, these “marketicians” will have the skills required to operate and manage such platforms, while their colleagues focus on coming up with creative, emotionally intelligent and effective customer communications.

These two trends will make recruiting and training marketers a bigger challenge for organizations in 2018. CMOs will spend a larger portion of their time creating and growing a competitive advantage through a team able to manage and execute creative marketing approaches, as well as selecting and integrating the right technological platforms.

Retail Marketing Teams Struggle to Make Sense of AI

The hype around AI will drive vendors and internal data science teams to try and apply recent advancements towards marketing optimization solutions – especially recent approaches in “deep learning”, for example using Generative Adversarial Networks (GAN), or the various emerging architectures of Recurrent Neural Networks (RNN), to name a few. Such strategic initiatives will challenge marketing departments to recruit more sophisticated AI talent and oversee complicated R&D processes, traditionally not managed by CMOs, and many will need to seek out more advanced expertise to select between technology vendors and their sometimes vague, fluffy marketing collateral.

Many retail marketing departments will fail to successfully harness those new AI approaches due to significant underestimation of the expertise and time required. Some CMOs will look to bring such initiatives into the marketing organization, instead of collaborating with a BI/analytics/data science group. This will increase the demand for statisticians and AI experts with significant marketing background at the junior to mid-management levels.

Personalization Still Reigns Supreme

Personalization — across all marketing channels and customer experiences — will continue to help brands overcome loyalty challenges. To maintain their edge, they will have to turn to the right technologies: omnichannel marketing orchestration analytics and optimization platforms, website/mobile continuous A/B testing and optimization, advanced product recommendation engines and data-driven application of promotional offers, to name a few.

From a methodology perspective, successful retail marketing departments will continue to move away from a modus operandi based on a small number of customer personas going through a small set of pre-defined fixed journeys towards much finer granularity in both customer attributes and campaigns. 

Digital-First Brands Give Others a Run for Their Money

Online-first retailers will continue to build and harness a loyal and engaged customer base. Having adopted the right personalization technologies at scale early, they are now giving brick-and-mortar brands a run for their money. Connecting the online and offline journeys of a customer has always been a challenge for retailers, but 2018 will be the year that younger, online-first brands turn it on and get ahead of their bigger competitors.

CMOs and marketing managers will have a big challenge in 2018 essentially reinvent their departments in order to keep up with the fast-moving changes of AI. Brands that can put their digital initiatives on top and really think digital will be the ones that turn these challenges into opportunities. As customer communication becomes more personal than ever, the winners will be the one that get personalization right.

Tal Kedar is CTO of Optimove

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