What is Machine Learning?
Machine learning is a type of artificial intelligence that uses predictive modeling based on historical data. This type of artificial intelligence pulls valuable information from structured data so you can make trend and behavior predictions.
Machine Learning Applications in Marketing
When implemented correctly, machine learning has proven to help improve sales by understanding your customer behavior and making decisions based on historical data. There are several different uses for machine learning in marketing, including:
- Customer Segmentation
- Segmenting your customers based on their purchasing habits, demographics, and usage patterns will allow you to personalize campaigns specifically for them.
- Recommendation Systems
- Machine learning recommendation systems are created to keep your customers interested in your new products. This type of system takes advantage of the customer’s purchasing history and uses that to promote products that they would be interested in.
- Customer Churn Prediction
- Machine learning can detect when a customer may be about to leave. This knowledge helps marketers use the information to create new strategies that are targeted toward customer retention.
- Life-Time Value Forecasting
- Machine learning can calculate the revenue a certain customer could potentially bring in for your business. Marketing departments can take advantage of this information by using it to create budgets.
Requirements for Using Machine Learning in Marketing
Exploring data is the first step in machine learning. Once the data is collected and analyzed, you can have a better idea about how to use the information collected. Consider bringing in a data analyst to help get the most information out of the data.
The next step is to gather and go through the data. This step requires data engineers who are experts in organizing and streaming data. Once your data is collected and prepared, the machine learning engineers will create models. These models will eventually be pushed into production.
Machine Learning Out-of-the-Box
The process of setting up machine learning systems can seem like a daunting task. Thankfully, there are several machine learning services for marketing that are readily available. These services include:
- Recommender systems
- Sentiment analysis
Read more about Machine Learning in Marketing at forbes.com