Colgate-Palmolive set artificial intelligence (AI) to work as it sought to tackle one of the thorniest problems in marketing: discovering the true return on investment (ROI) from its retail promotions.
Given that consumer packaged goods (CPG) manufacturers usually allocate between 30% and 40% of their budgets to such activity, finding anything near a definitive answer would generate significant value for the business, argued Rahul Tyagi, Colgate-Palmolive’s worldwide director/analytics center of excellence.
“Even the slightest impact can have, basically, a big impact on the bottom line,” he told delegates at The AI Summit, a conference held by Informa in New York.
AI has been the subject of vast hype among marketers precisely because it promises to establish trends and correlations from vast, sprawling datasets that humans – let alone traditional research methods – could not feasibly analyze. For a complex industry like CPG, where numerous brands are the subject of diverse price and display promotions in multiple channels, the allure is obvious.