Applying AI in Marketing: Q&A with Twilio’s Nicholas Kontopoulos

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By Published On: March 5, 20240 Comments

Nicholas Kontopoulos, Vice President of Marketing, Asia Pacific & Japan at Twilio talks elevating customer interactions with AI.

We know the retail landscape continuously evolves, and AI is at the forefront of this transformation. It’s creating opportunities for more personalised and efficient customer interactions, reshaping how retailers connect with customers. We spoke with Nicholas Kontopoulos, Vice President of Marketing for Asia Pacific & Japan at Twilio, to delve deeper into this topic. 

In our insightful discussion, we explored the applications of AI in marketing, its role in enhancing customer engagement, and how companies like Twilio are instrumental in this technological shift. Kontopoulos shares his perspectives on the challenges, possibilities, and starting points for integrating AI in retail strategies, providing a view of its impact on the sector.

In retail, we hear a lot of buzz around AI in the customer services and fulfilment sectors. What marketing applications does it have? 

AI’s marketing applications in retail extend beyond just automating tasks. AI is revolutionising retail by shifting from generalised personalisation to individualisation of the retail customer experience. Through advanced algorithms and data analysis, AI enables retailers to understand each customer’s unique preferences, behaviours, and purchase patterns, allowing for hyper-personalised offerings, dynamic pricing, and tailored marketing campaigns. 

AI-powered recommendation engines have the ability to suggest products tailored to individual tastes. At the same time, chatbots and virtual assistants provide personalised assistance in real-time, helping simplify the purchasing process and encouraging exploration. Augmented Reality (AR) and virtual try-on technologies enable customers to visualise products in their surroundings, fostering immersive experiences that reduce purchase hesitancy and help boost confidence in the buying decision.

Additionally, AI can help optimise inventory management and supply chain operations to meet individual demand efficiently. This transformation can ensure that every customer receives a unique and tailored experience, driving satisfaction, loyalty, and increased sales for retail organisations.

And what customer engagement potential is there? Don’t shoppers want to interact with humans?

In today’s retail world, the line between human and AI-driven interactions is blurring. Shoppers now enjoy a seamless, channel-less experience. AI is the powerhouse behind this shift, merging omnichannel capabilities with both human and digital touches. This evolution doesn’t force a choice between AI and human interaction. Instead, it uses AI to boost the human touch.

Keeping a human touch in AI-powered interactions is key. Consumers want real connections. AI in customer service aims to support, not replace, human interaction. This approach deepens customer loyalty. AI streamlines customer engagements, freeing up humans to forge genuine bonds.

At its core, the authentic human connection is vital. AI, when used well, enhances these interactions. It boosts the overall customer experience and loyalty. The aim? To blend AI and human elements. This creates a personalised, empathetic journey for shoppers, aligning with their changing needs.

Do you have any examples of AI being used to elevate customer interactions?

Exploring the transformative impact of AI in retail, H&M, and Sephora stand out with their forward-thinking initiatives. H&M’s chatbot, Kik, is a game-changer. It navigates through their extensive catalogue, guiding customers directly to what they’re looking for. On Kik, this chatbot goes a step further. It creates personalised style profiles, thanks to H&M’s stylist service. This is more than just customer service. It’s personalised shopping at its finest.

Sephora’s partnership with ModiFace marks another leap in e-commerce innovation. Their platform enhances the online shopping journey, making it more interactive. Advanced facial analysis technology lets consumers visualise product benefits before buying. Customers engage with the Sephora Visual Artist by uploading a photo on Facebook Messenger while in conversation with the Sephora Visual Artist. The AI promptly recommends the best product shades. It’s efficient, providing a virtual try-on experience that brings products to life before purchase.

These efforts from H&M and Sephora showcase AI’s powerful role in retail – making shopping more personal, efficient, and engaging.

Where do you start when there are so many different starting points, risks, and possibilities?

Machines were created to do jobs that people couldn’t do. Now we are moving to a situation where people will do the jobs that the machines are unable to do. That represents a huge shift in thinking across society, and as users of AI, we need to oversee that change. A structured approach is essential when faced with the complexity of starting points, risks, and possibilities in implementing AI. 

Here’s a strategy inspired by Twilio’s practices and insights:

  1. Prioritise data strategy: Begin by laying a solid foundation focusing on data strategy. Quality data is crucial for creating brand utility and seamless communication across channels. Clearly defining objectives and priorities and setting guiding principles like transparency, responsibility, and accountability will guide your AI journey.
  2. Engage and support your team: Recognise the shift in roles as AI takes on more tasks. It’s important to raise awareness and work closely with your people, preparing them for the changes. Establish a cross-functional AI committee, engage with external expertise, and invest in training and development. This will manage expectations and ensure your team feels valued and supported.
  3. Leverage existing assets: Start with what you already have. Review your current technology and data, and consider how to enhance these assets. Select the right AI technologies that fit your business goals, whether it’s machine learning, natural language processing, or others. Decide if building in-house or partnering is best, and ensure any solution can integrate with your existing tech stack.
  4. Foster a culture of experimentation: Encourage a mindset of curiosity and experimentation within your organisation. This approach not only fuels innovation but also supports continuous learning and adaptation. Twilio has launched several initiatives to exemplify how transparency and understanding of AI applications can foster a responsible and experimental culture. For example, the “AI Nutrition Facts” Label is intended to give consumers and businesses a more transparent and clear view into ‘what’s in the box’ – how their data is being used. Twilio also views AI and privacy protection as a shared responsibility between our customers and the company. To support this, we have adopted a set of CustomerAI trust principles – CustomerAI Privacy Ladder – to guide the responsible development, use, and deployment of predictive and generative AI across all of Twilio’s products and features.

By taking these steps, retailers can navigate the complexities of implementing AI with a balanced focus on people, processes, and technology.

How can Twilio help? Do you have any examples?

AI has significantly improved customer interactions in the retail industry, as demonstrated by clients like Marks & Spencer and Trade Me. Collaborating with Twilio, Marks & Spencer’s implementation of an AI-driven contact centre led to remarkable efficiencies. They achieved a 90% accuracy in call routing, improving their response rate and enhancing customer engagement, with a notable reduction in average call times. 

Trade Me’s use of AI for predictive modelling in marketing campaigns resulted in a 20% increase in campaign open rates and a 10% boost in click-through rates. This improvement translated into a 2-3 times better ad campaign performance, showcasing AI’s power in transforming customer engagement and marketing effectiveness.

About the Author: Rosalea Catterson

Rosalea is the Editor of Power Retail. With a keen interest in consumer behaviour and tech, she covers everything ecommerce and hosts the Power Retail Power Talks Podcast.

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