Five AI Strategies Startups Can Use To Build a Competitor-Crushing Marketing Capability
By Bob Finlayson, Jon Maron and Paul Brunato
Unquestionably generative AI offers the capability to remake many business functions, including marketing. Here are five strategies that enable startups to take on much larger competitors, by leveraging AI in their marketing.
Abandon the Gradual Approach
Abandon the typical, stepwise approach to building a marketing strategy or capability, and build all functions simultaneously. Startups often build their marketing function one capability at a time. AI enables you to cost effectively kick off a wide range of capabilities all at once. This is tremendously advantageous because it is the integration of numerous marketing capabilities that enhances the power to influence, which is the goal of marketing.
AI tools enable a small team to quickly develop market, competitor, and customer intelligence and analysis. This analysis will point to the most effective ways to reach and influence target customers, and will guide and inform your decisions regarding next steps.
Keeping in mind the insights gained from the AI analysis, next create the core marketing functions, again using AI to speed the process from content ideation, to creation, to distribution. But remember, the small team still needs expertise in the core marketing functions. See our infographic for an overview of the core functions we recommend every startup develop.
Build for Departmental Flexibility
Large marketing departments are often victims of siloing. This slows down their ability to adapt to rapidly changing market conditions, customer needs or product developments. In the age of AI, this is a death sentence. For startups, AI enables a very flat structure. This will help discourage the development of fiefdoms that will ossify and resist change.
We recommend a “council” approach where every member sees themselves as part of one team as opposed to a departmental structure. This does not mean avoiding the hiring of core function experts; quite the opposite. But it does mean the team must be highly integrated and comfortable with change. AI tools enable a small team to provide outsized capacity, but that team must be flexible.
Council members also must be able to identify and work closely with stakeholders outside of the marketing team. This includes members of the sales, finance, and product development teams, and the executive team. As with every marketing organization, these stakeholders are essential to your success, from signing off on recommended programs and campaigns to actively taking part in the recommended activities – because buy-in is everything. This is especially important for B2B startups as the buying environment is changing, making integration with sales and product development even more crucial. AI tools that support development of effective presentations can help marketing teams gain buy-in from their internal stakeholders.
Design Operational Strategies Around Functions
Today, AI tools can dramatically and cost effectively improve efficiency across a range of marketing activities, including: market and audience analytics, content creation, performance monitoring, digital and social media marketing, customer engagement, and marketing automation. But we recommend structuring operational strategies around key marketing functions rather than AI capabilities. This is because marketing functions remain relevant much longer than individual AI tools.
By focusing on the functions necessary to influence buyer behavior rather than over-investing in the current capabilities of AI tools, you can more easily adapt your operations to new AI tools and capabilities as they are developed. We provide a detailed list of the marketing functions most relevant to startups and how to integrate AI into those functions in the accompanying infographic.
A hallmark of successful marketing is the ability to pivot rapidly as product, markets and competitors change, or simply because a strategy or tactic doesn’t work as expected. An important benefit of AI is that it enables you to pivot more quickly, so be sure to build this into your operational approach.
Hire for AI Mindset
Marketing practices and the tools marketers use have undergone significant changes over the past two decades. As a result, successful marketers tend to be highly flexible in their thinking. In the age of AI, flexibility of thinking and the ability to rapidly adapt to new techniques and technologies is crucial.
Consequently, as you hire your marketing team, we recommend testing candidates for adaptability. There are several readily available tools for doing so. We also recommend asking candidates about their use of AI. AI tools are now readily available, so clearly you want to hire people who are familiar with and actively using AI in their work. Using such tools or managing their use is a sort of de facto test of adaptability.
The advent of AI tools and technologies means even small marketing teams have access to capabilities that were previously only available to larger, well-funded organizations. One such capability is in-depth analytics. Use of such analytics provides teams with the speed, flexibility and accuracy to evaluate results and rapidly adjust strategies and tactics – but only if the team understands how to use data and analytics to derive insights that make such adjustments possible. When hiring, be sure to look for analytically-minded people who are comfortable evaluating and using data generated by AI tools.
By requiring proof of differentiation and performance, these analytics help drive down costs. At the same time, they improve marketing’s ability to quantify results since every digital medium has a unique set of analytics, research and dashboards for review. As the legendary “Father of Advertising” David Ogilvy once said, “Any marketing people that ignore research and analytics today are as dangerous to a firm’s success as generals who ignore the decoded signals of the enemy.”
AI is already eliminating the more repetitive and mundane tasks in marketing. At the same time, the tendency of AI to create content that hues to the average – reflecting current “best practices” – puts a premium on human creativity to ensure outputs achieve differentiation and engagement with human customers. So hiring managers for marketing positions must shift their focus from candidates who perform well at routine tasks to those who are creative and have a high Emotional IQ. Emotional Intelligence, the ability to both manage your own emotions and understand the emotions of others, enables marketers to design marketing campaigns that more effectively influence the buying behavior of others.
In fact, given the current direction of AI development, where less technical knowledge is necessary to use AI tools, we recommend a focus on Emotional IQ as opposed to technical IQ. This does not eliminate the need for knowledge of marketing techniques. That knowledge is essential. Rather, technical knowledge of the AI tools themselves will become increasingly less important as the tools become easier to use.
Don’t Forget the Foundation and Fundamentals
Even in the Age of AI, marketing requires a foundation on which to build operational programs and campaigns. This includes establishing marketing and sales goals. AI can help with this, but ultimately it must be tied back to the organization's business goals. Similarly, AI can help with the development of language around value propositions and desired market position, but value propositions must stem from the value a company, its products and services will deliver to the target customers, and desired market position flows from the aspirations of the organization’s leadership and their business strategy.
Other fundamental components of marketing, such as an analysis of the target customers, competitive landscape and market, and even the overall marketing strategy itself, can be built using AI tools. But an experienced marketer will be needed to make sure that the proper prompts or content and context is provided, and that the output is properly evaluated with an experienced, critical eye.
A Note of Caution
One note before we wrap up. At present, AI tools struggle with three critical elements related to building a marketing capability.
Creativity: Generative AI tools, such as Large Language Models or LLMs, are built by ingesting huge amounts of text from across the internet. This means their outputs are often a sort of averaging of the ingested data. Creativity and uniqueness are key to marketing programs and campaigns that are differentiated from competitors. AI tools produce what could be called “best practice” outputs. But once something becomes a “best practice” in marketing, it is by definition no longer unique or new. So beware the race to the average often generated by AI tools. We expect models to improve over time, so we are watching this carefully.
Integration: Effective marketing involves the integration of a range of activities across media and engagement channels and formats, as well as the leveraging of customer, market and competitor data, and the implementation of monitoring and survey tools that provide a feedback loop for improvement. At present, no AI tool exists that can effectively provide end-to-end integration of marketing capabilities. We expect this to change, but integration is complicated and highly individualized based on business goals, target customer personas, product sets and market types. As with creativity, we are watching this area carefully.
Inception: Creating a marketing capability, especially one that can compete with much larger and better resourced competitors, requires broad knowledge of the marketing discipline and all of the factors that will determine how to influence a target customer to consider, purchase and finally become an advocate of a new product or service. Starting with the right foundation is often the difference between success and (drawn out) failure. In the same way that AI tools have not yet mastered integration, they cannot yet provide the development of a marketing capability from scratch.
In practical terms, we recommend startups that want to build a high-performance marketing capability first engage an experienced marketer to lead the development of that capability. We are prepared to revise this guidance when AI tools can overcome the three challenges described above.
Conclusion
AI provides powerful tools that startups can leverage to create marketing capabilities that rival those of larger, better-resourced competitors. But – at least for now – AI is merely providing tools. Marketing is a complex discipline because human beings are complex organisms. Influencing people to change behavior or adopt new behaviors is also complex. To date, AI has not been able to provide a replacement for human intuition and creativity in the marketing mix.
Sameness is a danger when using AI tools. Don’t become a victim of “best practices” or “averaged content.” Humans should be using AI tools, not the other way around.
We would be remiss if we didn’t point out that each organization’s ability to absorb change will vary widely, just like an individual’s. It’s convenient to assume that startups can make changes quickly, but the absorption rate for change of a given startup is typically tied to their level of development. Startups with little or no marketing capability will likely find adoption of this new AI strategy far easier than those with well-developed marketing teams. So start by gauging the ability of your organization to absorb change (what we call the ARI or Absorption Rate Index) to determine the speed at which you can implement our recommendations.
We Can Help
If you need help setting up or redesigning your marketing capability for the age of AI, contact us for a free consultation. We can provide a range of services, from individualized recommendations to full-scale implementation support. Schedule a free consultation here.
Written by Bold co-founders Bob Finlayson and Paul Brunato, and marketing professor and senior marketing executive Jon Maron, MBA.
