Jim Sterne is a true pioneer in data-driven marketing, a prolific author and popular speaker, and the co-author of “The New Science of Customer Relationships”.
From this year onward, AI gets real for marketers everywhere.
When it was first released in late 2022, OpenAI’s AI tool was a novelty – a plaything even – almost magical. People were captivated. It’s value as a utility was immediately apparent. But so was the concern for it becoming a Pandora’s Box.
Caught up in the hype, companies began urging staff to incorporate AI into their work. Which they did, dutifully, sometimes reluctantly, not sure exactly how to assimilate it into their work routine. Proof of concepts soon sprang up. Pilot programs followed. Most companies tried to fit AI into existing workflows when the trick was to rethink how work gets done.
This past year businesses began scrambling in earnest to integrate AI more fully into their operations, seeking efficiencies, cost reduction, time compression, driven by the fear of falling behind. Today the boldest enterprises are charging full speed ahead, embedding AI into revamped workflows and processes while upgrading their technology infrastructure. In fact, this year is predicted to be the AI turning point(1).
Marketers have been swept along in this rush to implement AI. The use cases are simply too obvious – better targeting, instant analysis, hands-off execution. Every marketing automation platform now claims to be AI first. AI adoption is at the top of every CMO’s list of priorities. But now, as marketers brace for what’s to come, there is this nagging dread. Are they digging their own grave? The immediate causalities will be entry level jobs for sure – but who’s next? How far up the line will the AI axe fall? What jobs will be left for marketers to do? The spectre of a hollowing out of the profession looms large.
AI will certainly relieve marketers of the drudgery. It will result in more effective targeting and personalization at scale, making one-to-one marketing possible (at last!). It will help tame complexity. It will speed up content creation and testing. It will allow marketers to easily spot emerging trends that might otherwise go unnoticed. It will compress and accelerate campaign workflows. It will generate forecasts based on an infinite set of market scenarios. It will simulate the voice of the customer. Theoretically, it should improve decision making – reduce latency –– serve as a sounding board – even spark innovative ideas. In short, it will allow marketers to move at machine speed.
Harder to predict, however, is the impact all of these efficiency gains will have on managing customer relationships. Everyone acknowledges the market will be upended, especially as personal shopping assistants become an integral part of everyday life. Customers will be more empowered. Harder to reach. Tougher to convert. AI agents will be ubiquitous, plugged into every consumer device, every tool, every app. But in a world where brand choice is mediated by agents sniffing out the best deal – trained to ignore brand braggadocio – how will marketing drive demand? Build brands? Win greater loyalty? How should marketing adapt to this new age of autonomous agents?
The obvious answer is for marketing to reinvent itself – to reimagine its corporate role and purpose – to stop functioning as a conveyor belt for brand messaging and take full ownership of the customer relationship. Because what businesses still struggle with, still get wrong most of the time, is figuring out what customers actually want and need. That takes empathy, imagination, creativity – the very attributes AI lacks (for the time being). So now is probably a good time for marketers to do a full reset and try harder to lead corporate strategy, not simply be answerable to it. Marketers should be dedicated to improving the lives of customers. Value creation and strategic differentiation should be the new mission, not just demand creation. AI can serve up the insight – marketers can provide the inspiration.
In fact, thinks Jim Sterne, marketing should take point on making customers happy. He further believes that the one-to-one future may finally have arrived thirty years after it was first envisioned(2), thanks to the alchemy of AI.
Jim has spent his career as an agent of change, helping marketers navigate successive waves of innovation. He wrote one of the first books ever on web marketing in 1995, just a couple of years after the “worldwide web” was unveiled to the public at large. Since then he’s authored a dozen other books on every aspect of web-based marketing, customer service and advertising. He also founded the Marketing Analytics Summit and the Digital Analytics Association.
In his latest book, “The New Science of Customer Relationships”, co-authored with the renowned data analytics expert Thomas Davenport(3), Sterne explains how AI will finally deliver on the promise of one-to-one marketing. The companies that succeed, he believes, will be the ones that use AI to advance the interests of customers.
Jim started his career selling Apple computers in an electronics store after getting his BA in Shakespeare. That’s where I started the conversation, wondering what drew him to the Bard.
Jim Sterne (JS): Two things. First of all, started my university career at UCLA and after a year and a half was kind of directionless. So I dropped out. And then after a couple years it was time to drop back in and question was, what should I study? And the answer was what did you get your highest grade point average in? And that was English literature, which was a surprise to me. I, I hadn’t thought much about that. I went to a local play where there somebody said, oh, you’re going to UC Santa Barbara. You have to take a class in Shakespeare from this guy named Homer Swander(4). Like, okay. Turned out to be world class Shakespeare academic, and thought leader and yeah, influencer, if I can use that in the 1970s. So, first day, first class, sat down next to the girl of my dreams and we’ve been married ever since.
Stephen Shaw (SS): Wow.
JS: And that’s why I did Shakespeare.
SS: And do you still have an affinity for Shakespeare to this day?