The rise of AI in marketing technology brings ethical questions to the forefront. Here’s how marketers can balance innovation and privacy.
Marketers have long used technology and data to target their audiences effectively. AI has now enhanced this capability, but it also raises ethical concerns. How can marketers balance innovation and privacy?
The AI arms race in marketing technology
Martech vendors across all platforms, including data analytics, customer relationship management (CRM) systems, email marketing platforms, social media advertising and more, are racing to incorporate AI features into their products.
Layering AI on top of the immense amounts of data these platforms often contain about consumers, marketers suddenly have more power at their fingertips than ever. Just a few examples:
Salesforce’s Einstein AI
Einstein GPT will infuse Salesforce’s proprietary AI models with generative AI technology from an ecosystem of partners and real-time data from the Salesforce Data Cloud, which ingests, harmonizes and unifies all of a company’s customer data.
With Einstein GPT, customers can generate content that continuously adapts to changing customer information and needs in real-time. For example, Einstein GPT can generate personalized emails for salespeople to send to customers, generate targeted content for marketers to increase campaign response rates and auto-generate code for developers.
HubSpot’s Content Assistant and Chatspot AI
Content Assistant helps marketing and sales teams ideate, create and share quality content in a matter of minutes if not seconds. ChatSpot.ai helps HubSpot customers complete a variety of tasks using a natural language chat-based user experience, including drafting professional, effective sales emails personalized to the recipient.
Sprout Social AI
Smart Query Suggestions elevates Sprout’s Listening solution with GPT-powered query keyword recommendations to capture the most comprehensive insights. Additional upcoming OpenAI and Repustate-based capabilities will minimize manual care tasks, provide targeted, high-quality copy suggestions to prioritize high-impact creative and strategic work and unlock nuanced understanding of social conversation.
The explosion of AI tools enables us to launch more targeted and personalized marketing campaigns quickly. However, AI also introduces a new legion of ethical considerations for marketers to navigate.
Data privacy: The cornerstone of ethical marketing
For years, data privacy has been one of the primary ethical concerns in marketing technology. With the proliferation of digital channels, marketers have been able to collect troves of personal information from consumers, often without their explicit consent or awareness.
In recent years, the introduction of the General Data Protection Regulation (GDPR), California Consumer Privacy Act (CCPA), California Privacy Rights Act (CPRA), Apple’s App Tracking Transparency feature and a slew of other state laws have increased consumer awareness around the data companies are collecting.
To comply with these new regulations, marketers have learned to consider ethical principles when handling data:
- Informed consent. Consumers should be fully informed about how their data will be collected, stored and used. Transparent privacy policies and easy-to-understand terms and conditions are essential.
- Data ownership. Consumers should have control over their data and the ability to access, modify or delete it at any time.
- Data minimization. Collecting only the data necessary for a specific marketing purpose helps minimize the risk of misuse.
- Data sharing. Marketers should be cautious about sharing consumer data with third parties, ensuring that these parties adhere to the same ethical standards.
Responsible AI use in marketing
Artificial intelligence revolutionizes marketing by enabling advanced data analysis, predictive modeling and personalized content delivery. However, the speed at which AI is developing is outpacing the government’s ability to regulate it.
Similar to how it took many years and many very public data privacy scandals before governments stepped in to protect customers with data privacy laws, it will be a while before there are legal frameworks in place to guide marketers on how to use AI. Without such regulations, it’s marketers’ responsibility to craft their standards for the ethical use of AI.
Some considerations marketers should be thinking about:
Algorithmic bias
AI algorithms can inadvertently perpetuate biases present in the training data, leading to discriminatory outcomes. Marketers must actively work to identify and mitigate biases to ensure fair and equitable treatment of all consumers.
Transparency
AI-driven decision-making processes should be transparent and explainable. Consumers have a right to know how AI is used in marketing and how it influences their brand interactions.
Consent and control
Consumers should have the option to opt out of AI-driven marketing initiatives if they so choose. Additionally, they should be able to access and modify the data AI algorithms use to make predictions about them.
Accountability
Businesses should take responsibility for the actions of their AI systems. This includes regular audits and assessments of AI ethics, along with clear lines of accountability for any issues that may arise.
The consequences of losing consumer trust
On average, more than 25% of a company’s market value is directly attributable to its reputation. Failure to uphold ethical standards in marketing can have dire consequences. Beyond potential legal penalties and fines, the most significant risk is that a company damages its reputation and loses consumer trust.
Perhaps nothing is more important to a brand’s reputation now than its handling of data and respect for consumer privacy. Up to 81% of respondents agreed that how an organization treats personal data indicates how it views and respects its customers, according to a 2022 Cisco survey. This is the highest percentage since Cisco began tracking it in 2019. Consumers are taking action:
- 76% say they would not buy from a company that they do not trust with their data.
- 37% indicated they had indeed switched providers over data privacy practices.
- 53% say they manage their cookie settings from a website before accepting.
Moreover, all of the media coverage around ChatGPT has made consumers much more aware of the power of AI, even at this early stage in its lifecycle. While 54% of consumers are willing to share their anonymized data to improve AI products, 65% have already lost trust in organizations due to their use of AI.
AI has supercharged marketers’ ability to engage with consumers on a personal level. However, marketers must wield this newfound power responsibly and ethically. Striking the right balance between marketing innovation and consumer privacy is both a moral and strategic imperative.
To succeed in the long run, marketers must prioritize data privacy, adhere to ethical guidelines and champion responsible AI use. By doing so, they can build trust, foster customer loyalty and reap the benefits of ethical marketing practices that align with the values of today’s socially conscious consumers. Ethics are not a hindrance but a competitive advantage in today’s world.
The post The ethics of AI-powered marketing technology appeared first on MarTech.
MarTechAbout the author
Megan Michuda is currently the SVP, director of marketing operations and innovation at BOK Financial. Prior to joining BOK Financial, she served as global head of marketing technology at Janus Henderson Investors. Janus Henderson was a Stackie Award winner in 2018. Megan is currently responsible for BOK Financial’s marketing technology stack, marketing automation, digital analytics, and marketing operations. In 2020, Megan’s startup Stacktus was acquired by CabinetM, a leader in martech management. Megan is now both a user of CabinetM as well as an advisor. Megan received her bachelor’s degree from Brown University and her master’s of science in technology management from University of Denver.
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