Today, a vast majority of global equity trades (buying and selling of shares) originate out of “black boxes”, literally algorithms that think and act for themselves seeking out incremental gains from small pricing discrepancies. These black boxes work - they deliver massive gains to the clever organizations that built and own them, and sometimes for outside investors who have privileged access to them. It was not always thus. A decade ago most trade ideas originated from the minds of clever, even creative, finance executives. And to an extent, but a lesser one, that still occurs.
So what of “black box” marketing? Where are the algorithms thinking and acting for themselves in seeking out incremental gains in customer acquisition, cross-sell and the like? And are they likely to become predominant enough to crowd out other more hands-on, more creative, approaches to marketing?
Imho, the answer to the first question is yes, but they are proprietary. The answer to the second question is probably.
A material amount of Amazon’s incremental sales come from the “if you likes this, you might like that", algorithm. But that algorithm is proprietary to Amazon. Tesco’s method for mining and exploiting its vast den of customer data, as well as its method for collecting it in the first place, is similarly proprietary. In other words, it’s core stuff. Not the sort of thing you can go out and buy shrink-wrapped, or even outsource to a third party. So still a vast majority of marketing ideas and campaigns originate off the screens of Apple Macs or white boards, arguably as the byproduct of a creative and analytical process that would be hard to “black box”. But it is worth trying and so sure enough someone will. The question is whether it will be the marketers themselves.