AI-Backed Personalization Could ‘Transform’ Consumer Product Advertising, Sales By 2030
Executive Summary
“If the previous decade was about the new digital, the current decade will require brands to undergo dynamic transformation,” said creative media consultant Kate Scott-Dawkins at NAD conference.
Artificial intelligence-enabled personalization will “transform” advertising and sales for beauty, consumer health and brands across product categories within 10 years, says creative media consultant Kate Scott-Dawkins.
“If the previous decade was about the new digital, the current decade will require brands to undergo dynamic transformation,” Scott-Dawkins said on 29 September during the annual conference of the National Advertising Division, part of BBB National Programs Inc.
“Everything will be hyper-personalized or hyper contextualized, based on privacy settings and the platform we’re dealing with. I don’t only mean creative here. I mean everything—products, services and creative and advertising,” added the vice president for thought, leadership and innovation at the San Francisco office of Essence Global LLC.
While AI is broadly defined as machines capable of carrying out “smart” tasks, it also can be developed to “learn” as devices process information and begin making decisions without human input.
The AI Personal Assistant
Scott-Dawkins provided HBW Insight with examples of beauty and wellness companies “leaning into AI-enabled personalization” that show where brands might be headed.
Among them is L’Oreal SA’s Perso, an AI-powered device that launched earlier in 2021 which dispenses single-dose skin-care and cosmetic formulas customized through analyses made with a mobile app. The product offers versions for skin care, liquid foundation and lipstick. (Also see "After Clarisonic: Device Brand’s Founder Primes Opulus For Launch In New Beauty Tech Era" - HBW Insight, 22 Jul, 2020.)
Kate Scott-Dawkins: "I mean everything—products, services and creative and advertising."
Source: Essence Global
“Why force consumers into buying a standard shade of lipstick, one that’s been pared down to be acceptable by the largest number of consumers, when you can instead allow every customer to mix a shade unique to them? And that shade can adapt to their preferences as it learns,” she said in an email.
In the wellness arena, Scott-Dawkins noted Nestle SA’s Nestle Wellness Ambassador AI program piloted in Japan which combines data from a DNA sample with diet and health to recommend a customized food plan, including capsules to make drinks and snacks with added vitamins.
“I haven’t seen research yet into whether or not DNA-based nutrition has quantifiable benefits, but I do expect more companies to invest and innovate in this area,” she added.
Major consumer health companies including Bayer AG are investing in similar technology. The German firm in 2020 announced an investment in Edifice Health, Inc., which is developing an OTC kit to measure “inflammatory age,” a “metric that predicts multi-morbidity and immune decline and provides actionable items to improve your immune health.” (Also see "Bayer Among Investors In $12M Funding For Edifice’s OTC Test For ‘Inflammatory Age’" - HBW Insight, 1 Jun, 2021.)
Scott-Dawkins offered a colorful depiction of a woman starting a day in 2030. She’s helped by an AI personalized beauty and health app, including a sleep tracker and a mirror that sends data to a smart makeup center on her bathroom counter.
“The sleep data, weather and shirt color information area all fed into the lipstick color selection, which is pumped into her daily applicator,” Scott-Dawkins said. In the kitchen, her digital assistant “recommends one of her custom-blended smoothies for breakfast.”
Realizing she’s low on the product, the woman asks the assistant to order more. “The company will use her DNA data on file and any new health data from the digital assistant to blend and ship her selections for the coming week.”
Brand/Consumer Interactions ‘Bot-to-Bot’
Essence Global, a UK firm owned by New York-based Group M Worldwide, LLC, conducted a survey in 2020 with 50 experts from academia, business, marketing, technology and ad trade organizations on future advertising and purchasing trends.
The experts were asked how likely a set of 15 scenarios are to be true by 2030, including time spent in virtual experiences and using AI and automation; three-quarters of them said by 2030, all services, products and advertisements will be personalized.
The experts also expect AI will result in consumers outsourcing purchasing decisions to machines, “which will optimize selections based on our goals and preference,” Scott-Dawkins noted in a report on the survey posted to Essence Global’s website.
The majority of brand/consumer interactions will be “bot-to-bot” or between robots that simulate human conversation, according to two-thirds of experts interviewed.
Scott-Dawkins advises businesses to prepare for AI revolutionizing their operations by 2030, including developing new models for copyright protection and collaborating with technology firms.
Marketers also must be sensitive to consumer privacy with AI-enabled personalization. “Any scenario involving sensitive personal information (which most of these will rely on) must include proper safety measures against data breaches, biases and other ethical pitfalls,” she said.