Consumer Products

How AI and Machine Learning Are Revolutionizing the Consumer Products Industry

Artificial intelligence (AI) and machine learning are having a disruptive impact on the consumer products industry, changing not only what types of products appear on retail shelves, but also how those products are brought to market and eventually delivered to consumers. As a result, leading consumer products companies are beginning to integrate elements of AI and machine learning into nearly every aspect of the product lifecycle.


New AI-powered products


A visible way to see the impact of AI on the consumer products industry is via the introduction of products that directly make use of language recognition and computer vision – both of which are only possible with the introduction of machine learning algorithms. Common products in this category include AI-powered virtual assistants, such as Amazon Echo and Google Home. Already, products that you use on an everyday may already integrate elements of machine learning without you even realizing it, including Facebook (photo recognition) and Netflix (personalized movie recommendations based on past viewing behavior). This type of recognition and recommendation functionality is quickly extending to more and more consumer products.


A new era of personalization and customization


Consumer products categories seeing a great uptake of AI-powered personalization include the food and beverage sector and the apparel and fashion sector. For example, consumer products brands are using sophisticated AI algorithms to analyze various taste, aroma and flavor profiles of products, and then coming up with new beverage or food products that have combinations of similar tastes, aromas or flavors. Eventually, the goal is to usher in an era of ultra-personalization, in which consumers no longer need to purchase mass-market goods that are completely identical to all other goods.


Manufacturing, logistics and delivery


At the manufacturing level, AI and machine learning are also impacting the consumer products industry. For example, AI is being used at manufacturing plants for quality control and supply chain optimization. Today’s modern logistics chains are so complex that humans are now using AI for what is often referred to as “augmented decision-making.” Thanks to AI algorithms, managers now have much greater visibility into all work-in-progress, and can then analyze the best processes to automate. This leads to faster time-to-market, as well as lower costs for consumers. Going forward, look for even more efficiencies in shipping and logistics. For example, Amazon has a patent for “anticipatory shipping,” which is a way of getting an order prepared for delivery before a product has even been ordered. By using AI algorithms to study user behaviors, Amazon can make very informed guesses about which items in your shopping cart will actually end up as part of your final order.


Marketing and promotion


Finally, AI is playing an important behind-the-scenes role in how consumer products are marketed and advertised to consumers. According to Gartner, by 2020, AI will help to manage 85 percent of all customer interactions in retail. The easiest way to see this is with e-commerce, where every step of your customer journey is being studied and analyzed, so that you can be shown ads, messages, and promotions that have the highest likelihood of getting you to purchase something.



As can be seen, AI and ML can play a variety of roles within the entire customer experience. They are impacting manufacturing and logistics, marketing and promotion, and even customer service (through the rise of AI-powered bots). Going forward, these technologies will continue to have a dramatic impact on the entire consumer products industry.


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