Irish businesses welcome AI in marketing, but clear strategies needed

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Businesses believe AI and data will have a transformative impact, but early approaches to the technology have been timid, this Red C survey reveals, writes Jason Walsh

Senior executives at Irish businesses are optimistic about the prospects of increasing digital marketing efforts with artificial intelligence (AI), according to the latest Marketing Pulse survey commissioned by marketing and digital transformation agency Core Optimisation and conducted by Red C Research and Business Post.

The June 2024 Marketing Pulse survey found that three-quarters of marketers said they were confident in the role of AI in marketing, while only one in ten had a negative view.

Caroline Dunlea, CEO and co-founder of Core Optimisation, said that underpinning it all was a recognition of the transformative role data already plays in digital marketing, but it was clear that further change was afoot.

“In terms of marketing, there are obviously a lot of things that are changing,” she said.

“Everyone is talking about artificial intelligence right now. You can’t turn your head without hearing about this technology and seeing that it’s making huge strides.”

However, adoption of AI for marketing has been slow so far, revealing a gap between aspirations and capabilities.

Just over one in five companies have agreed on a strategy, while half have at least started working on a strategy, while more than four in five plan to at least develop one.

Interestingly, small and medium-sized businesses are more likely to have agreed on a strategy, according to the survey.

According to Dunlea, data-driven decisions are now a critical part of overall business operations, so the slow adoption of AI strategies shows that more companies need to adapt to changing behaviors, including consumer preferences.

“It’s changing massively and rapidly, so we have to stay cognizant of what consumers want when we’re developing these strategies,” she said.

“One of the biggest challenges is that they don’t know where to start when developing a strategy for implementing AI in their business. They will likely focus first on exploration and then on areas where they can introduce automation and streamline processes.”

Longer term, Dunlea said, these small steps will pave the way for deeper uses of AI, including data analysis.

“The survey shows that senior executives are currently unsure how to adapt it to their business processes, and there is also some resistance in terms of defending existing processes.

“However, I truly believe that we will see a lot of opportunities emerge for companies that engage with AI, and even their business models could change. For those that adopt it in a meaningful way, I think it will give them a very good competitive advantage,” she said.

The survey found that businesses are aware of the benefits of data-driven decision-making: more than half (55%) of companies surveyed said they have a first-party data acquisition strategy, and companies with more than 50 employees are more likely to have one in place.

Because AI runs on data, it is critical that businesses collect the right data and are able to store and use it compliantly in order to leverage it effectively, Dunlea said.

Marketing agencies, she said, have a responsibility not only to help clients with their AI and data strategies, but also to quantify their ROI.

“I think we place a high value on being a trusted partner that aligns with our clients’ business goals to deliver maximum ROI. We want to make effective business decisions that drive growth.”

While only one in six companies expect their marketing budgets to increase in the coming year, there was broad consensus that these budgets are not expected to decrease. Midsize companies are most likely to expect their marketing budgets to increase, according to the survey.

In this context, Dunlea said, agencies will need to demonstrate the benefits of AI and data.

“Monitoring performance, setting very clear key performance indicators (KPIs) and benchmarking are all essential,” she said.

Overall, Dunlea said, the outlook is positive for digital marketing, with companies looking to leverage specialized experience, such as advanced analytics, social advertising and search advertising, and learn from the experiences of agencies in other industry sectors.

“They still see digital marketing as the fastest and most effective way to reach their customers. Digital remains the most transparent and visible way to understand the impact of your spend on metrics and the market,” she said.

“I think the next 12 months are going to be very interesting because we’ll see what’s been retained. From my perspective, I think customers have to be our first priority. We have to make sure that we adapt and listen to our customers and be there to be a conduit for these new tools and technologies, acting as a guide and a support to get the best outcomes for their businesses.”

The survey also found that business leaders had an overall positive outlook for the future. However, confidence in their own business outpaced confidence in the national economy as a whole. While seven in ten people have confidence in the Irish economy, almost nine in ten say they have confidence in the future of their business. In addition, larger businesses expressed more confidence in their own business than smaller businesses.