AI (artificial intelligence) has emerged as one of the fastest-growing and potentially most useful technologies for marketers. But are all AI tools as effective as they purport to be? Recently, the Securities and Exchange Commission (SEC) charged startup founder Ilit Raz with fraud. His startup, Joonko, claimed to use AI to help companies recruit a more diverse workforce. The truth? Raz was using AI as a buzzword to attract investors while lying about the volume of customers and, presumably, the effectiveness of his company’s tools.

The Joonko case is just one example of AI washing: exaggerating the relevance and usefulness of AI while, in many cases, simply using pre-existing techniques to get the job done. To avoid wasting money on AI-washed “solutions,” marketers need to figure out how to become discerning tech buyers.

The Problem With AI Washing

When you search for new marketing tools or news on MarTech (marketing technology) advancements, how many times do you see the terms “AI-Powered” or “AI Solutions”? Ads for new, all-singing, all-dancing AI marketing suites are everywhere.

The problem is that some of these tools are exactly the same as they were this time last year. Some are the same as five years ago. The “AI” they’re using, in several cases, is no more advanced or revolutionary than email automation, data collation, or very basic chatbots.

Of course, some tools are going way beyond this. Modern AI should, according to the National Artificial Intelligence Act of 2020, be able to “make predictions, recommendations or decisions influencing real or virtual environments.”

Examples include business intelligence (BI) tools that use historical data to make predictions and suggestions. For example, actual AI marketing tools might assess campaign successes to predict the potential impact of a new campaign or suggest the best time to launch. Other AI marketing tools may leverage generative AI to learn a company’s brand voice for advanced, real-time client interactions. That’s not the same as an auto-response when you’re out of the office — and clients can tell the difference.

The Temptation to Overstate AI’s Importance

The irony, for marketers, is that tech providers are using AI and its underpinning machine learning capabilities as marketing tools. The ability to say an app is “AI-powered” helps get it into searches with other AI-capable software — and in front of more potential customers. But if AI is only present within the tool as an automation aid, or for one aspect of data analysis, then using AI as a unique value proposition (UVP) is misleading.

Tech startups need to be wary of falling into this trap. The SEC is cracking down on AI fraud — the Joonko case is just one of several involving AI washing. Two investment advisers were also recently charged and fined $400,000 after claiming they were using AI in ways they simply weren’t. Enforcement director Gurbir S. Grewal noted that there’s a current trend for seeking out AI-related investment opportunities. But when tech startups overstate the usefulness of AI, it harms investors and can lead to serious criminal charges against the company.

Tips for Marketers: Spot an AI-Washing Scam

No one is suggesting that tech startup marketers should avoid AI tools. In fact, you can use AI in so many ways, from content marketing to data analysis. However, you need to make sure that you’re not paying for “new” AI tools you already have. Here are a few tips on savvy software shopping for marketers:

• Check the claims the software provider is making. Does the tool actually add value to your marketing tech stack?

• Look for genuine reviews online — not just on the provider’s website.

• See if there’s a video demo of the product on YouTube — by an independent reviewer.

• Check for integrations — Genuine, marketing-focused AI tool providers should have an idea of what’s already in your tech stack and will show how their tool integrates with your existing workflows.

• Be wary of unbelievable promises — If an AI tool’s website promises to raise marketing ROI by 500%, be very skeptical.

Consider talking to other marketers in your industry who may have used the tools you’re interested in. If they’ve had success with them, great. If not, you may have just avoided wasting money on an AI-washing scam.

Final Word

AI should make marketing simpler, not more complicated. The right tools and support functions streamline processes, helping you reach more potential clients and engage in truly data-driven marketing activities. For more support with tech startup marketing, book a free 15-minute introductory call and speak to one of our in-house experts.

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