Plus: How AI Chatbots Help Potential Customers And Your Conversion Rate |
| After a bruising fight, exhaustive appeals and a future that looked dim, a presence both reviled and beloved returned this week. Which presence is that? I’m actually talking about two things: TikTok and President Donald Trump. The social video app, which is regularly used by more than 170 million Americans, got a clear message about its fate on Friday. A unanimous Supreme Court decision ruled that the law forcing the ban or sale of the Chinese-owned app was focused on national security interests, not targeting users’ free speech. The law was set to take effect two days later, and the platform went dark on Saturday night, with users encountering a message that said it was not available because of the law. Hours later, Trump—who mustered an unlikely comeback in November following an unpopular first term that ended in a violent attack on the Capitol four years ago—said he would issue an executive order to save TikTok. The platform came to life again on Sunday, with users treated to a montage of videos praising Trump the first time they opened the reinstated app. And on Monday, Trump was sworn in to a second term as president, with TikTok CEO Shou Zi Chew sitting on the dais behind him. TikTok is not necessarily back forever. Trump’s executive order delays the bill’s effective date 75 days to give his administration the opportunity to “determine the appropriate course of action.” Considering that the bill passed Congress with bipartisan votes, the appropriate course of action should be letting it take effect. However, Trump, whose love for the app may be because his campaign TikTok posts were extremely popular, is also trying to cut a deal. He’s mentioned wanting a sort of 50-50 joint ownership arrangement between TikTok’s Chinese parent company ByteDance and the U.S., though it’s unclear at the moment whether he’s talking about a U.S. entity owning half of the app, or the U.S. government. On Monday, Trump said TikTok is “worthless if I don’t approve it,” and seemed to threaten tariffs on China of up to 100% if it blocked a deal. So creators are back on TikTok, but things are definitely not the same. Reports indicate that potential buyers for the app include Jimmy Donaldson, also known as influencer and media personality MrBeast. But they also include people whose sensibilities are much more political—billionaire investor, entrepreneur and former Los Angeles Dodgers owner Frank McCourt; X owner and Trump’s biggest financial backer Elon Musk; and the U.S. government, now led by a businessman who started Truth Social, his own social network, to get around his accounts on other platforms being banned. In short, TikTok may become the next Twitter or Truth Social. (Or maybe users will be rewarded on a game show with large amounts of money for excelling at the next round of TikTok challenges.) While brands and creators are rejoicing about getting the platform back, it still may be worth it to diversify social strategies and not get too comfortable—exactly what many are doing with Trump’s return to the White House. A completely different technology that is beginning to drive the marketing conversation is AI, which is widely used both for creative and administrative purposes. Gupshup CMO Salim Ali says that using a sophisticated AI chatbot to be the first line of contact with customers can boost engagement and conversion, increasing your marketing reach. An excerpt from my conversation with him is later in this newsletter. If you like what you read here, you can easily share it online and on your social media pages. This newsletter, and all previous editions of Forbes CMO, can be found on our website here. Until next time. |
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| In today’s CMO newsletter: |
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| The economy is on many peoples’ minds, but consumers are still spending. The National Retail Federation reported that November and December retail sales were a record $994.1 billion, 4% higher than 2023, writes Forbes senior contributor Pamela Danziger. Holiday spending exceeded predictions of 2.5% to 3.5% growth. But this growth wasn’t just for the holiday season. Sales for 2024 as a whole grew a record 3.6% to a record $5.28 trillion, the NRF found. The growth is expected to continue, Deloitte reported in its 2025 retail industry outlook, Forbes senior contributor Joan Verdon wrote. The firm predicts that consumer spending will grow 3.1% in 2025. While this level of spending might be good for business bottom lines, it might not be the best thing for the economy as a whole. In Q3, credit card balances nationwide hit $1.17 trillion—an increase of $24 billion—and 3.5% of all household debt was in some form of delinquency, according to statistics from the Federal Reserve Bank of New York. Consumer confidence also is declining, with the Conference Board seeing a drop of 8.1 points in December. The expectations index—based on consumers’ short-term outlook for income, business and the labor market—fell 12.6 points to 81.1, just above 80, which usually is a benchmark for a coming recession. |
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| Walmart is known for selling affordable and accessible merchandise, but the retailer turned many heads about a month ago when it started selling what looked like replica Birkin bags. The genuine Birkin is a staple of luxury brand Hermès that has a starting price of $10,000. The item on Walmart’s website, dubbed the “Wirkin” (either for “working class” or “Walmart”), cost about $100, writes Forbes senior contributor Pamela Danziger. While it’s currently difficult to find a “Wirkin” on Walmart’s website, the retailer actually has started to carry the real thing. Walmart has a new partnership with Rebag, an online marketplace for pre-owned designer handbags, watches and jewelry, Forbes contributor Doug Melville writes. While a pre-owned Birkin is still likely to be much more expensive than the “Wirkin,” the partnership helps Walmart better position itself both to high-end consumers and those who aspire to own luxury brands. It also brings a merchant that specializes in upcycling to a much wider audience of potential buyers. |
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| As AI technology gets better at creating images, video and sounds, we may be moving toward a time when people won’t believe anything they see on a screen is real. The Content Authenticity Initiative, started by Adobe in 2019, is a cross-industry community of more than 4,000 members that support deeply embedded metadata that indicates how content was created, called Content Credentials. Forbes senior contributor Barry Collins writes that the Content Credentials standard now aims to mark any fully AI-generated content with a small “CR” logo in the corner, making it obvious that the image isn’t real. However, Collins writes, the group that manages the Content Credentials—and has pledged to adopt the initiative to flag AI-generated content—is missing two prominent members: Apple and X, the social network formerly known as Twitter. Andy Parsons, senior director of the Content Authenticity Initiative at Adobe, told Collins earlier this month that ubiquitous adoption depends on Apple joining the group, since the company controls so many devices and the Safari browser. Parsons said that Apple has historically been slower to join “new” initiatives, waiting to make sure they are well-established first. Twitter had been a member of the consortium before it was purchased by Elon Musk. Centibillionaire Musk also owns AI company xAI, which has few guardrails on the image generation tool for its Grok platform, freely creating images of well-known people and copyrighted items doing controversial things. Parsons told Collins he’s hopeful that X will eventually join the consortium, though he got a “comically short” answer from Musk when he asked about it last year. It is not a member at this time. |
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| | | Gupshup CMO On How AI Chatbots Can Improve Marketing |
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| Since people began relying on computers and mobile phones, instant messages became the norm for communicating with both acquaintances and businesses. Companies created automated chatbots on their websites for customers to use, but many hated them because of their limited responses. (Though actual people in call centers were often trained to give the same range of responses.) Gupshup uses AI to create chatbots with more conversational messaging that can do more for customers. I talked to CMO Salim Ali about how this helps marketing as a whole. This conversation has been edited for length, clarity and continuity. AI-powered chatbots are often seen as a solution for basic customer communications. What are some ways that they can be applied toward marketing? Ali: If you look at AI or chatbots broadly, there is what I do to make my life easier as a marketer inside, and what I do to use to engage my customers or prospects, which is more the outbound side. Co-pilots are internal, and chatbots are external-facing. In a platform, we have a co-pilot. Give it a word, a phrase, it will make an image for you. As a marketer, you don’t have to go to an agency. Boom, this thing is created. You’re trying to do a global campaign in Spanish, Portuguese, English and German. It automatically translates. From an external perspective, the chatbots [were once] engaging with a prospect coming to the landing page, then filling a form and then going to them. No, you remove the whole landing page. You come to me, you’re chatting right away. Acquisition calls become dramatically lower because you remove three steps in the process. The chatbot is engaging with you. It’s only pointing to a human when it’s essential. It’s assisting the human agent behind, [and] you’re adding a lot more volume. I’ve seen data [indicating] up to 50% lower acquisition cost. When you engage—email back-and-forth, landing page back-and-forth—engagement is about three times better because it’s happening [in] real time when they’ve asked for it, not a week later. [Traditionally,] I put a display ad, you come onto my webpage, you browse it, then you click through and go to a landing page. Right now [with a chatbot], you click and the ad brings them to a messaging platform right there, so the advertising spend is getting two to three times better outcomes. Further down the marketing funnel, conversions are at least two or three times, depending on the business, better because they are are converting faster. We have a customer in São Paulo, Brazil, a big retailer, and they were figuring [out] how to run a campaign for Mother’s Day. The whole catalog is like 5 million SKUs. They put out a Mother’s Day gift finder agent. You come and say, ‘I’m looking for a gift for my mom. She’s 52 years old, she likes to cook Italian.’ [The chatbot] doesn’t give you a list of 10,000 SKUs. It gives a list of 10, 15. [And the user can continue,] ‘No, I don’t want this. Actually, why don’t you look at what can she do outdoors? She likes to run.’ They show amazing conversion, not from the perspective of selling more, but the deal cycle’s shrunk dramatically. You can search on Amazon. It’s not easy. You still do a lot of back and forth. This agent is helping the customer triangulate and go deeper fast, like a human would. It’s asking a friend. Before AI became commonplace, people hated interacting with chatbots online for the stilted and imprecise answers they always gave. How do you show a user that your AI-powered chatbot is different and worth their time? We allow customers to play with things. Not ‘Hey, buy!’ But ‘Hey, here’s a gift finder,’ or ‘Here’s a recipe cooking app.’ Something that is not sales-y, not marketing; just go play with it. Once they start playing with it is when they get it. Because the [previous bad] experience has been the baggage. ‘This Mother’s Day gift finder is amazing. It was just fun.’ They’ll share it with people. The more you get trial going, they will use it. You’d mentioned that many customer service employees had been trained to deal with consumers like old-school chatbots. Now with more human-sounding chatbots, are peoples’ jobs at risk? No. The way we’re looking at it is very simple. If you run a marketing campaign [and] you don’t answer an incoming query within eight hours, the propensity of buying drops significantly. People can get to it, and you can keep hiring more and more, but chatbots become the front office helper. It is able to also, inside the enterprise, give the [human employee] a lot of intelligence about the customer. Why are you going and searching and clicking through all your CRM data? It all will be provided to you. It’s definitely giving us better conversion, being able to triangulate [customer needs] and deflect to the right automated [responses]. Some will punt to our [human employees]. And if that works, we are all better off. |
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| Frigid weather forced Trump’s inauguration this week inside the U.S. Capitol, limiting the in-person audience, but people tuned in on television. |
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24.6 million | Viewers who watched the inauguration on major networks | |
| 10 million | Number of viewers on Fox, who said it was the network’s second highest-rated inauguration day coverage in history. In contrast, just 848,000 watched on left-leaning MSNBC | |
| 67 million | People who watched Trump’s September debate with former Vice President Kamala Harris |
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| It’s a new year and time to revisit your playbook. Here are nine trends and strategies to help your brand thrive in 2025. This year, more workplaces are taking on more tasks with AI. Here are some tips to be a leader of developing your company’s AI strategy. |
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