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What is IBM Watson and How is it Changing the Way We Market to Consumers?

What is IBM Watson and How is it Changing the Way We Market to Consumers?

IBM is doing its best to corner the artificial intelligence (AI) market with its powerful cognitive machine, Watson. Perhaps you remember Watson best from when it won Jeopardy in 2011, but it’s just as likely that you heard the song it wrote last year with Alex Da Kid or watched the H&R Block Super Bowl ad in which Jon Hamm refers to Watson as “one of the most powerful tools our species has created.” Watson is pervasive, so it should be no surprise that we are starting to see major impacts in the way marketing is developed and executed. In today’s post, we’ll take a look at what Watson is, along with an overview of some of the ways it’s changing how brands engage with consumers.

What Is IBM Watson?

To put it simply, IBM Watson is a type of supercomputer called a “question answering machine” that combines data analyzation with AI techniques, such as machine learning and machine vision, to answer complex questions by referring to a larger amount of data than a human would be capable of processing. While access to data via the cloud makes it seem like it can think like a human, IBM itself prefers to avoid the term artificial intelligence because the company wants to assist human workers that can tap into common sense and intuition, both of which are judgment calls that don’t rely solely on data. Terms like “cognitive computing” and “augmented intelligence” better capture the fact that Watson is an agglomeration of 30 different products which can sort through a literally inhuman amount of data.The best comparison is that an oncologist may only read a half dozen research papers per month while Watson can read half a million in 15 seconds and, in combination with other areas of learning, be capable of identifying signs of cancer or opportunities for certain types of treatment which the oncologist can then review specifically.

IBM began developing Watson in 2004, naming it after company founder Thomas J. Watson, and it appeared on Jeopardy in 2011. That’s when its AI applications began to be developed in seriousness, with a focus on data-dependent industries like health care. Now, thanks to its ability to process data at 80 teraflops and standard access to 90 services storing more than 200 million pages of data, Watson works with dozens of brands across 45 industries throughout 20 countries. In 2016, IBM premiered AI services for everything from supply chain management and order fulfillment to workplace collaboration, customer service and, most pertinently, marketing. Watson Ads is a cognitive system built specifically for advertising, but other options are available, thanks to open APIs and SaaS options. For instance, businesses can turn to Watson to help implement effective chatbots.

How Does Watson Impact Marketing?

While Watson doesn’t reach the level of artificial general intelligence — that is to say, the type of AI we see in movies which is human-like in its sentience — it does a host of things that are extremely relevant for marketers. We highlight four here, but with the way Watson learns and with new developments always on the horizon, the AI is sure to offer even more benefits as time goes on.

Data Analyzation

This is where Watson excels and it can be used for back-end developments. Salesforce has tapped Watson to develop what it calls Einstein, which provides real-time analytics and deep, dynamic insights into CRM data to the businesses. This enhances the way brands understand their customers’ needs and interests. However, Equals3 has gone a step further with what it calls Lucy. Major media and buying plan agency, Havas Media, saw both faster campaign deployment and reduced costs when using this Watson platform to analyze structured and unstructured marketing data and mine it for customer insights in seconds.

Interprets Emotional Response

This is exemplified in most of the customer-facing applications, especially chatbots, including the two used in our next two points. Its natural language processing capabilities allow Watson to pick up on nuances and multiple meanings, as well as certain elements of perspective and interest. This will be further enhanced by IBM’s next Watson development, Project Intu, which will strive to identify the mood behind the user’s statements and synthesize an appropriate emotional tone for the interface – improving both the experience and end results.

Interprets Intent

Probably the easiest way to see this is by looking at’s “gift concierge” called GWYN, powered by Watson. It’s based on the Fluid Expert Personal Shopper software platform to engage with customers online using and responding to natural language, allowing it to make tailored gift suggestions appropriate to each customer and the person receiving the gift. This provides a truly intuitive shopping experience that can foster better engagement.

Use Means Learning, Improvement, and Change

Macy’s On Call service not only helps shoppers by answering questions, it provides Macy’s itself with a host of information about what products are resonating with customers both individually and on the whole. As Watson continues to gather and analyze this information, Macy’s will be better able to market to customers on a personalized level while also enhancing their general marketing to lift lagging products or boost those with the most interest.

Similarly, TD Ameritrade has tapped Watson for its bot, Alvi. The bot is intended to learn about a person, including perusing the customer’s social media accounts, in order to match them with the right investment education for personal finance. The more the customer engages with Alvi, the chatbot will be able to make more and more suitable suggestions. Taking that level of nuance and learning a step further, H&R Block has tapped Watson to keep up with changing tax laws while improving client communications and identifying deductibles. This provides a much more frictionless and speedy experience that’s highly personalized, something customers are sure to continue to seek out.

Artificial intelligence is a powerful new way for people to interact with each other in a variety of ways. IBM Watson is the perfect example of that, and it’s become fast becoming the leading application in a wide spectrum of industries. To keep up in a cross-device, omnichannel marketplace, businesses need to see the value in building AI into their strategy, either by building new tools based on AI concepts or by applying AI tools to existing portfolios.