The Customer Loyalty Industry has an Opportunity in its Grasp.

Why does the attitude toward partnerships between Artificial Intelligence (AI) and humans continually gravitate towards mutual exclusivity? Fear, driven by a lack of understanding and trust in technology, and often those creating it, has fueled speculation around AI’s capability to replace humans entirely.

A YouGov survey shared that 22% of Americans are afraid of artificial intelligence (AI) while a  Pew Research Center survey found that 52% of Americans are more concerned than excited about AI. It seems the dominant feeling Americans have about artificial intelligence is caution, with the YouGov survey reporting that 54% describe their feelings towards AI using the word “cautious.”

The result, according to Chase Tarkenton, boost.ai, is that AI adoption will lag AI innovation until more trust is established.

Why Marketers are Excited about AI

In the current business landscape, AI is revolutionizing the way companies conduct experiments across the organization. There is newfound capacity to understand how much to invest in each individual customer, in turn opening untapped revenue streams and marketing efficiencies.

Marketers can now evaluate each customer and know exactly how much they should be investing and the exact triggers that will yield a specific result at an individual level. Imagine knowing how much a customer is currently worth at every stage of their lifecycle and being able to confidently alter marketing investments to get more revenue/trips out of each person?

Pricing is another focus area of AI-powered database marketing. Lyft, Uber, and Amazon experiment with pricing all the time, and they do it on an individual customer basis. Until now, this approach was only done by people with large data science teams. However, AI is changing the paradigm so that every company – even those that don’t have a cadre of data scientists – can create experiments and offers down to the individual level.

How Easily Trust can be Destroyed

For years, consumers have held suspicion about the invasiveness of their mobile devices. New disclosures about “Active Listening” are fueling Fear and Suspicion to record levels.

“Active Listening,” uses Artificial Intelligence to collect real-time data on what users might be considering purchasing. By analyzing conversations, the software can identify potential customers and deliver ads that align with their spoken intentions. How does this happen? When a new app download or update prompts consumers with a multi-page term of use agreement somewhere in the fine print, Active Listening is often included.

Recently, Cox Media Group (CMG) disclosed it was advertising a service that claimed to target ads based on what potential customers said near device microphones. After the report surfaced, Google removed CMG from its “Partners Programme” website, Meta said it was reviewing whether CMG’s technology had violated its terms of service, reiterating that it does not use users’ phone microphones for ad targeting, and Amazon denied any involvement with CMG’s programme, warning it would take legal action against any partner found to be breaching its rules.

But the damage was done. As Tyler Childers sings “It takes twice as long to build bridges you’ve burnt”.

What to Do?

If Marketers and Technology providers continue the current arc, the denouement of the story will be a tragedy of epic proportions. Control of their future strategies will be snatched away by regulators who, in the absence of proactively responsible business behavior, will move to control the way and which AI can be deployed for marketing purposes.

• Under pressure from the European Commission’s Digital Services Act (DSA), TikTok announced it would voluntarily suspend its new app TikTok Lite’s reward program, meant to encourage greater usage of its platform.
• Meta is facing backlash based on recent privacy missteps. The impact of this regulatory awakening impacts the future of customer data management and possibly weakening of the surveillance capitalism model.
• Telegram founder and CEO Pavel Durov was arrested last month at a French airport, reportedly stemming from an investigation of the app’s “lack of moderation” for content published on the channel.

Does the marketing community need any more evidence for proof of resolve by regulatory bodies and privacy lobbies to control the continued rollout of AI in MarTech? We know consumers are skeptical of marketers in many ways and suspicious of AI to accelerate poor behaviors.

This is an ideal juncture where Loyalty Marketing community can coalesce to lead the conversation about how to adopt AI and turn the tide for the collective good for this industry.