There is no shying away from the fact that generative AI has become a source of hope for busy professionals. A recent survey indicates that 61% of organisations use AI for social media primarily to reduce staff workload.
Further, 64% of chief marketing officers (CMOs) remain optimistic about AI's potential though there has been a decline in average marketing budgets from 9.1% in 2023 to 7.7% of overall company revenue this year.
Useful, maybe. But is it also profitable?
Neil Patel, the co-founder at Neil Patel Digital, emphasised that while AI can simplify and automate marketing tasks, it doesn't necessarily make the overall process easier.
He noted that, similar to how the cloud revolutionised business operations, AI lowers the barriers to entry for startups, making it easier and cheaper for new companies to develop products and services.
However, this reduction in barriers also leads to increased competition. More startups and businesses entering the market means that companies must invest more in marketing and sales to stand out and attract customers.
David Spitz, the founder of BenchSights, provided data showing a dramatic rise in marketing and sales expenses for SaaS companies over the past eight quarters. The figures (150%, 167%, 179%, etc.) demonstrate the growing cost of generating revenue, with companies spending $2.64 for every $1 of revenue.
Additionally, these companies take an average of 2.64 years to recoup their marketing and sales expenditures, which does not even account for profitability. This underscores the increasing significance and cost of marketing efforts.
Patel also highlighted a survey of 113 later-stage startups, which revealed that they spend an average of 27.59% of their raised funds on marketing, illustrating the substantial investment required in this area.
There is More Bad News
Data suggests that the entire process from writing to publication can be completed in as little as 16 minutes with AI, compared to an average of 69 minutes for humans. Despite this efficiency, the question of trust remains significant.
According to the Hootsuite Social Media Consumer 2024 Survey, 62% of consumers are less likely to engage with or trust content if they know it is AI-generated content. It further reflects on the traffic or engagement of the content too.
Patel previously noted, "If everyone uses AI to create content, and if AI uses data already available to develop these projects, we won't have anything new and authentic anymore."
It appears that only marketing professionals are confident in AI, while consumers remain sceptical.
"People in the comments ask me why I post on LinkedIn. Doesn't this take focus away from my business? The answer is NO -- LinkedIn is one of the best marketing channels where you can organically attract thousands of users to your B2B or B2C product," Rebryk explained.
This year, LinkedIn introduced many AI features ranging from assisting in the creation of a job description feed to writing a post.
This feature has faced criticism from users as they ask, why just share thoughts and rewrite with AI, offer a feature that can add an audio mode and save us the trouble of typing. While others believe it enhances the writing and boosts the author's confidence.
Hope your next marketing strategy doesn't solely rely on AI and if not, then good luck!
