A Dealer’s Guide to AI, Machine Learning, and Predictive Analytics

Jargon aside, these technologies aim to create the best possible online shopping experience through personalization

If you’re reading the news, checking out dealership vendor awards, and following new product releases, you’re probably hearing a lot about artificial intelligence (AI), machine learning, and predictive analytics. Self-driving cars and connectivity make extensive use of these technologies.


But the AI applications for digital marketing in automotive sales are quite different. And it can be hard to keep track of the new developments, the differences between the terms, and how they’re relevant for your dealership.

So let’s get into it: What’s the difference between AI, machine learning, and predictive analytics, and what can they do for your business?

Artificial intelligence and machine learning

Artificial intelligence, most commonly referred to as AI, is an umbrella term that refers to any machine that can do a task, like a robot. Any machine that acts like a human in some way—speaking, walking, lifting, etc.—uses AI.

Machine learning is a term sometimes used interchangeably with AI, but it’s actually a subset that refers to machines programmed not only to perform tasks, but to be able to learn from data by themselves to decide what tasks to perform.

The idea is to code machines to “think” like humans, looking at past experiences and forming a plan for the future based on findings. So machine learning is a type of AI that takes data, then does something with it.

Predictive analytics

Predictive analytics is one of the major applications of machine learning. It uses machine learning to analyze what has happened in the past and, based upon that, predict what will happen in the future.

For example, predictive analytics takes data from your previous customers’ online shopping behavior and uses it to predict what other customers will do in the future.

Smart targeting and personalization

Now that we’ve gotten these definitions out of the way, let’s get to their practical application for auto dealers: smart targeting and personalization.

Today’s most effective, best-optimized digital marketing for dealerships uses predictive analytics to enable smart targeting and personalization. This is the best way to create a shopping experience that reaches more customers—and gets you the most leads possible.

What smart targeting and personalization do is essentially respond to customers’ questions, but without actually hearing them.

It’s like a salesperson in a clothing store hanging back, watching customers browsing for jackets, then quietly moving the display so that when they turn around, the browsers see a sign for sales on jackets and popular designs similar to the ones they’ve been looking at.

It’s a wordless conversation that moves the buying process along, customized for each customer. Here are some more specific examples of how this can work for your dealership’s digital marketing strategy.

SEO

When online shoppers Google a name, term, business, etc., Google uses machine learning to show results that are both relevant and popular.

When you invest in your own SEO, either in-house or not, you are trying to enhance the quality of your website so that it will rank well in search engines, and be presented when people are searching for vehicles near you.

Retargeting

When you pay for traffic to bring visitors back to your site, you are using visitors’ interests to show them ads in which they might be interested.

For example, if someone browsed a Toyota Corolla on your dealership website, machine learning allows that person to be targeted with an offer on that same vehicle—which it knows the customer might like. This is likely to lead that person back to your site.

Smart pop-ups

Presenting different content to different visitors on your website is personalization at its finest. Software that analyzes user behavior to segment groups of customers, then targets them with content and offers they want, encourages people to stay on the site longer.

It also optimizes conversions, getting far more leads than sites that do not offer this level of personalization. Think back to the clothing store example.

Bots

Most companies and dealerships now have online chat, but the majority of them are staffed by humans. One of the hot new tech developments now is chatbots, programmed to understand human language and respond immediately.

The advantage of using chatbots instead of a human chat tool is that when programmed with sophisticated language capability and accurate information, bots are fast, reliable, automated, and available 24/7, even after dealership hours. They can get, or keep, the conversation going with the many shoppers browsing from their phones in bed.

Artificial intelligence, machine learning, and predictive analytics are crucial as we look ahead with the goal of optimizing dealership websites to their maximum potential. Jargon aside, at their core, all of these technologies aim to create the best possible online shopping experience, so that customers truly enjoy your site and become loyal, paying customers.

So when you look at your website and choose vendors, make sure that you are getting the best personalization services available. Customize your customers’ online shopping experience just as you would their showroom experience, and they are more likely to stick with you all the way through the buying process.

Devorah Wolf is the content marketing manager at AutoLeadStar, a conversion optimization platform for the auto industry. With many years of experience in content writing and editing, she blogs about making the most of your online traffic, and keeping your online shoppers happy so you get more customers to your showroom. Devorah is always open to industry interviews and reports, so please reach out to collaborate.

Devorah Wolf

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