Real or faux Artificial Intelligence? And the price you pay for missing the difference.

  Mollie Monett

Spotting smart, machine learning technology and filtering out the “faux” AI will be critical as the industry continues to accelerate dealer-tech adoption. It’s no secret that companies can be generous with the claim that their software uses real AI and it’s easy to get caught up in the glamorous vocabulary of marketing.

“Very few, in my opinion, are using strong AI,” says Wayne Butterfield, director of cognitive automation and innovation at ISG. “What we need to be mindful of is that AI covers over 200 different disciplines, so it’s not uncommon to be using a branch of AI in a tool. Some advanced analytics may now be classed as AI, even a small amount of machine learning. This means that you can be creative as a vendor.”

Learning the basics of AI

Artificial intelligence was designed to mimic human intelligence, but it’s evolved tremendously over the years. Most AI examples that you hear about today – from chess-playing computers to self-driving cars– leverage thousands of data points. They make real-time decisions at scale – always relying heavily on deep learning to process large amounts of data to recognize patterns.

Spot the difference

Companies leveraging real artificial intelligence will have unique or specialized datasets whereas faux AI will simply apply logical rules to their solutions. “If this, then that“ machines require instructions, while intelligent machines don’t because they can learn from data just as humans do. Medium gives a great example here, referencing a delivery system. An automated Amazon delivery robot follows a specified route. But an AI-enabled delivery robot can learn how to navigate through crowded streets and even change routes due to its visual processing technology and machine learning algorithms. When more data is collected and algorithms are optimized, AI-enabled delivery robots have the advantage of being able to deal with unexpected situations.

Why should this principle be any different for your automotive marketing strategy? Maybe you’re currently manually allocating 20% of ad budget to social and 80% to search and display. But is this the best breakdown? What if one month google is bringing more leads than social, and the next month social brings more than google? If you’re manually allocating budget you may miss this and allocate budget as is, since you don’t catch the optimization. If it’s using technology-first marketing, you’re leveraging AI’s smart algorithm, and constantly putting the money where it matters, and in turn, moving more vehicles off your lot.

With 92% of your shoppers starting their buying process online, means limited room for error or missed opportunity in those earliest touchpoints. AI will allow you to generate thousands of ads in a matter of minutes, based on multiple data sources – such as your website, inventory and CRM. And since it’s dynamic – any change in the data sources is reflected immediately in your ads. It will also allow for tracking your shoppers’ digital footprint straight from your website, tracking every term they search, every VDP they view, every button they click (or even hover on!), and leveraging that data to create a tailor-made customer experience.

Keep in mind that AI becomes increasingly effective over time. Be mindful of vendor solutions that require limited data for model training. “AI-based solutions generally require a fair bit of data to perform at a desired level of accuracy. It would be useful to consider the sources of data available for the system to learn as well.” The more data an AI model is exposed to, the better it should perform. Meaning, if you’re not getting pre/post data from other dealers as a reference point, it’s most likely fake AI.

Summing it up

In the world of E-commerce, it’s clear that AI enables the tracking of countless customer touch-points. It’s what allows companies like Amazon, Netflix, and Spotify to make such on-point recommendations for what you should buy, watch, or listen to next. It’s what enables giants like Google, Facebook, and Twitter to target super-focused ads at relevant audiences. Investing in intelligent marketing means being able to scale ads and campaigns at a level humans cannot reach. Run thousands of ads at any given moment, update price changes and disclaimers in real-time, and shift budget and resources based on opportunities to capture in-market car shoppers, wherever they are (search, social, display). AI can and will revolutionize automotive, just as it has so many other industries. You just have to be smart enough to spot the real thing.