Unleashing the power ofweb scale personalization.

MACHINE LEARNING MAKES YOU MORE HUMAN

TODAY’S ROADMAP

1st half:● Quick review - What is machine learning?● Putting ML into marketing terms● Comparing ML marketing against other options● Current & near-future examples

2nd half:● Build a personality analysis service

WHY IT’S IMPORTANT

● “Smart” is coming, ready or not● Machine learning is here and its impact on our lives is

only going to grow● It’s a paradigm shift — Seems strange that we would

now have access to these “out-of-reach” tools● It’s much easier than you think ● And it will quickly become the norm● Now is the time to jump in, ahead of the curve

WHAT IS MACHINE LEARNING?

PATTERN RECOGNITION

Finding patterns in data.

So we can apply that pattern to other data.

FOR EXAMPLE...

Identify the pattern in buying habits of women

who just became pregnant.

Locate that pattern in others and target them with special offers for pregnancy products.

Will the current app user buy “maternity clothes” now?

BREAKING IT DOWN

is female?

is age> 20?

is Y app installed?

is X app installed?

end

has used < 30 days?

was X function

used?

was Y function

used?

no

yes

no

yes

no

yes

no

yes

end no

77.1%

yes

end

probably

52.3%

93.6%

2.3%15.8% 23.4%

WHY NOW?

The expensive and complicated machine learning systems Target had back in 2012 are cheap and

simple today.

And you have easy access to them.

businessinsider.com/the-incredible-story-of-how-target-exposed-a-teen-girls-pregnancy-2012-2

OUR JOURNEY

THE PROBLEM WE’LL TACKLE

One of the biggest challenges we face as marketers is how to personalize messaging to individual prospects and customers so that it most strongly resonates with

each unique recipient.

TODAY’S THEME

Machine learning makes your business more human.

AND WHAT MAKES US HUMAN?

Empathy.

The ability to understand andshare the feelings of another.

boagworld.com/usability/adapting-empathy-maps-for-ux-design

BUILDING RELATIONSHIPS

“The goal of a company is to have customer service that is not just the best but legendary.”

~Sam WaltonFounder, Walmart

RELATIONSHIP IS END-TO-END

“You can always find out the true nature of a business by simply asking for a refund.”

RELATIONSHIPS 101

Listen to what they say,Become an expert in who they are, and

Find ways to make their life better.

HOW DOES MACHINE LEARNING FIT IN?

IT’S A QUESTION OF SCALE

Building deep meaningful relationshipstakes a lot of work.

As human beings, we can only build great relationships with a handful of people.

But machine learning can amplify that effort so you can build great relationships with millions.

FOR EXAMPLE...

Pick one of your customers.

Read every piece of content they’ve ever put out — every blog post, tweet, facebook update, Instagram image, etc.

How well would you know them? Pretty damn well — you understand them and can share their feelings.

That’s empathy.

And how well do you think you could market to them now?

Machine learning is an amplifier.

It allows you build empathy at a scale and depth that is simply beyond human capabilities.

● Model the habits, likes, dislikes and values of your customers, then

● Predict the behavior of those customers and personalize their content accordingly

NOW SCALE THAT UP

IN EFFECT...

Computers can dig deeper and personalize at a larger scale than humans are capable of.

This allows machine learning-powered brands to develop deeper relationships — with more customers

— than previously possible.

BACK TO MESSAGE PERSONALIZATION

CRAFTING MESSAGES

Today, we’ll talk about 3 different options…

● Old school — very limited● A better way — somewhat limited● The machine learning way — sky’s the limit

Plus, some examples from the near future.

OLD SCHOOL

HOPE & A PRAYER

Deliver one version of your message and send it to every recipient at

the same time.

Hope they like it.

VERY LIMITED

● No personalization, eg. “Hi, you”● Written for everyone, connects with no one● Single delivery time, opens will be stroke of luck

A BETTER WAY

MULTIPLE FLAVORS

Deliver multiple variations of your message and

randomly distribute them across every recipient at

the same time.

Determine which variation performs the best — use it

next time.

GETTING WARMER

● Basic personalization, eg. “Hi, Sam”● Everything is reactive — after the action has been

taken (and after you spent the $)● Minimal access to underlying motivation factors● Have to create multiple versions of same asset

THE MACHINE LEARNING WAY

INDIVIDUAL FLAVORS

Deliver personalized variations of your

message for each and every recipient. Sent at

ideal time for each recipient.

A PARADIGM SHIFT

PredictOptimize vs.

React to signalsStart with guesses

Shape behaviorsStart with models

Up to now, marketers have focus on “optimizing” their campaigns. With machine learning, we can now shift to “predicting.”

Behavior Prediction

Interest Tracking

PREDICTIVE PERSONALIZATION

Pages & content they’ve visited

Emails they’ve opened/clicked

Resources they’ve used/downloaded

Products they’ve viewed/wishlisted/bought

Searches they’ve made

Blog

Store

Find patterns Determine what they want to see/do/buy next (and when)

Days/time they’re active App

Search

Devices they’ve used (& geo location)Email

Social

• Recommended posts• Recommended products• Delivery day/time

• Dynamic content• Related posts• Sales offers

• Related products• Cross/up sell• Dynamic pricing

• Dynamic content• Sales offers• Functionality

• Query suggestions• Results ranking• Sales offers

• Content curation• Delivery day/time• Retweet/reshare

Tribe• Recommended topics• Topic curation• Member introductions

Yourcustomer

PEOPLE LIKE PERSONALIZATION

● 69% of consumers believe a brand's consistency across channels affects their loyalty

● 59% of consumers who have experienced personalization believe it has a noticeable influence on purchasing

● 67% of consumers who have experienced personalization are highly in favor of personalized coupons

All of these are strong points for machine learning-based marketing.

infosys.com/newsroom/press-releases/Documents/genome-research-report.pdf

WHY IT ROCKS

● Unique personalization, eg. “Hi, Sam — we noticed that you were searching for...”

● Can fine-tune content per individual person● Demonstrates genuine empathy for customers● Driven by computers (faster, cheaper)

EXAMPLES

PERFECT MATCH

A quick note…

Computers are very good at doing the boring, monotonous tasks people don’t like to do.

Tasks that can build billion dollar companies.

PRODUCT RECOMMENDATIONS

techblog.netflix.com/2012/04/netflix-recommendations-beyond-5-stars.html templates.prediction.io/PredictionIO/template-scala-parallel-universal-recommendation

SENTIMENT ANALYSIS

keyhole.co

ibm.com/smarterplanet/us/en/ibmwatson/developercloud/tone-analyzer.html templates.prediction.io/pawel-n/template-scala-cml-sentiment

AUTOMATED CAPTIONS

“A group of young people playing a game of frisbee.”

Automatically create contextual

descriptions of your images for

accessibility.

io9.gizmodo.com/computers-wrote-the-caption-for-this-photograph-and-ch-1660450610

TRANSLATION

Write your message once, have it be

delivered in multiple languages through

automated translation.

PERSONALIZED CONTENT

Deliver blog posts and other content,

uniquely personalized for each customer.

techcrunch.com/2016/04/21/facebook-news-is-new

PREDICTING CHURN

Monitor for signs that a customer may bail.

Then deliver targeted messages and

promotions to retain them.

PREDICTIVE SEGMENTATION

Dynamically group recipients based

on interests, actions, etc.

LIFETIME VALUE FORECASTING

LTV - arguably, the single most important metric

for marketing.

Forecasting the profit — or value — your business will gain from its entire

relationship with a particular customer.

10xnation.com/customer-lifetime-value

Customer

Group

Retention

time

Transaction

Value

Transaction

FrequencyCLV

Young

Mothers60 months $10 1 $600

Teenagers 24 months $10 1 $240

Single

Parents48 months $12 1 $576

WRAPPING IT UP

NET IT OUT

The better you know your customers...The better your marketing will be…

The better your customer relationships will be...The more customers you'll have...

The more successful your business will be.

AND...

Machine learning amplifies your relationship-building skills to levels beyond human capabilities.

WHAT ARE YOUR THOUGHTS?

Machine learning makes your business more human.

UNLEASH YOUR BUSINESSEMBRACE EXPONENTIAL

10xnation.com