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AI is A+
In ten years, referring to something as an “AI company” may feel as outdated as discussing a “dot-com business” does today.
AI will be integrated with business operations, rather than emphasized for marketing value — table stakes, rather than window dressing.
Already, a small number of CPG startups and retailers have built their own AI teams behind the scenes. These include customized haircare startup Prose on the small end and Walmart on the large end.
But these companies are the exception. While hundreds of companies are hiring in-house AI roles today, only a few of those are in CPG/retail (notably Walmart, Coca-Cola, and Foot Locker).
Most consumer businesses have yet to consider AI at all — or if they have, they’ve done so through third-party vendors.
Dozens of startups have sprung up to offer AI tools to brands and retailers. Companies have partnered with startups to design everything from adaptive marketing campaigns (like Signpost, which works with small local retailers) to virtual makeup try-ons (like Modiface and Perfect Corp., which between them have pulled hundreds of leading cosmetics companies into the AI age).
Amazon also offers machine learning as a service — but at least publicly, no major CPG or retail company has taken them up on it.
What’s the holdup?
Lack of data is a major roadblock to AI adoption.
AI algorithms are not magic bullets. They need to run on huge swaths of accurate customer data, and 100+ year-old companies often have a lot of that data stored across scattered software programs, forgotten spreadsheets, or even basement file cabinets.
As AI becomes increasingly pervasive, consumer companies will need to step up their efforts to collect and aggregate customer data. This will prepare them to partner with AI providers in the short term, and potentially build out their own AI capabilities over the long term.
We dove into a wide range of artificial intelligence trends that will impact consumer goods, healthcare, and other industries this year. Check out the free report here.