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What's next for generative AI in the consumer goods and retail industries?

Plus, three tips for seamless tech integration

Aswin Chandrasekaran

Senior Partner, Consumer Goods Data-Tech-AI



The next wave of gen AI use cases will see companies move beyond using it to increase productivity to employing it to redesign processes to transform the fabric of business operations, enhance innovation, and drive value. Just think of the infinite ways we use electricity; first used to light our homes, it then became an essential building block of modern life, so much so that we take it for granted in our daily lives.

Generative AI, too, has countless unexplored applications. Consumer packaged goods (CPG) and retail leaders can expect to see new use cases unfold that have a wider impact on the enterprise and the end consumer.

Unlocking new use cases for generative AI

To use gen AI as a lever for growth, CPG leaders should explore how the technology can transform the way data is used in these two ways:

  • Data insights: Combing through huge swaths of data that all CPGs are sitting on about their products, customers, and consumers and turning it into meaningful insights
  • Data recommendations: Turning those insights into recommendations to improve everything from promotions planning to inventory management

In practice, this might look like extracting data from the order life cycle and turning it into insights to remedy risks and issues in supply chain management. Or it could mean using gen AI to harvest better data from the point of sale and triangulating it with other data for richer insights. For example, using generative AI to decode product descriptions coming from the point of sale helps CPG and retail companies understand the exact product sold at the exact price to inform better sales-planning decisions.

More relevant products and experiences

Data insights and recommendations will have a big impact on shoppers. How? By interpreting massive amounts of data about consumer expectations, tastes, and preferences, gen AI can make real-time suggestions, appealing to shoppers in three ways:

  1. Better in-store product placement: Where to place products in the store to increase the likelihood of someone buying them
  2. Enhanced product filtering capabilities: Helping consumers find exactly what they are looking for
  3. Smarter product suggestions: Showing more relevant products to consumers to increase basket size

Consider parents shopping at a grocery store. Gen AI technology can allow them to filter products by allergens, food dyes, and nutritional information. Similarly, a sustainability-conscious shopper can filter apparel by ethically sourced materials or dyeing process. This next generation of gen AI use cases will enable consumers to find the products they want and need quickly and accurately, leading to better consumer experiences and increased brand loyalty.

The sky's the limit for enhancing consumer experience with gen AI. CPG and retail companies should explore these new use cases and begin to plan for heavy consumption periods like summer break, back to school, and the holiday season.

Seamlessly blend gen AI into the tech landscape

It takes work to integrate gen AI into the existing technology landscape of CPG and retail enterprises. To make sure it is implemented without a hitch, here are three considerations to help seamlessly blend gen AI into the enterprise:

  1. Power to the people: Stave off employee fear that gen AI will lead to redundancies by democratizing its use – let employees experiment and explore it safely and securely. To get the best out of teams, train them on how to best use this technology as a copilot in their daily jobs
  2. Future fit: Identify the right projects for gen AI by exploring what it might solve in the future. Follow a process to evaluate business outcomes against value generated, implementation complexity, and risk to uncover new growth opportunities with gen AI
  3. Responsible AI: To ensure you develop AI solutions that are fair, trustworthy, and accountable, create a center of excellence to act as an ethics board. This diverse team – made up of people with different experiences, perspectives, and skills – can oversee AI development from start to finish, catch biases up front, and prevent issues down the road

Successful CPG and retail organizations will discover new and innovative ways to use gen AI to turbocharge return on investment and radically enhance customer experience. CPG and retail companies should view gen AI as the next best thing since electricity – with the power to change everything about their business.

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