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Making AI actionable in CPG: A no-brainer? 

The consumer-packaged goods (CPG) industry stands on the brink of a revolution, powered by the advancements in artificial intelligence (AI). This article recaps our recent webinar, where we dove into the potential of AI to drive revenue growth in the CPG sector. The webinar, moderated by Valentina Pérez Garcés, shared insights from Carst Vaartjes, co-founder and Chief Innovation Officer at Visualfabriq. 

The transformative power of AI 

The latest developments in artificial intelligence, particularly in generative AI, are truly groundbreaking.  

Generative AI has seen spectacular advancements, most notably in the realm of neural networks. These networks are not new, but they have been significantly upgraded in the last 10-20 years. This was possible thanks to improvements in hardware and processing speed, some of which have been driven by the video game industry. 

In the last years, this has been going incredibly fast. This acceleration is largely due to the introduction in 2017 by several Google data scientists of transformer models: “Transformer. A novel neural network architecture for language understanding.” This is a way to hook up neural networks in an architecture that makes it easier and quicker to train them with very large datasets and have an outcome that doesn’t require much manual tweaking. So, it means that you can process bigger sets of data and do much more with them. 

Natural language processing 

What recently made generative AI an instant success with many users is that it offers a new more intuitive way of communicating with a machine through a natural language interface. A recent US survey found that 73% of businesses are already using Generative AI on a regular basis. 

Everyone is now familiar with ChatGPT, an AI chatbot with natural language processing (NLP). It allows you to have human-like conversations to complete various tasks. It’s essentially a statistical model that’s very good at predicting the next word in a sentence. Even if it doesn’t “think” like a human, it shows remarkable understanding, drawing on tons of information it has ingested during its training. 

There are many other GenAI applications that have progressed at a rapid pace, including: 

Image shows many applications of generative AI​

These have the potential to create images and videos for ad creative. They can also create, manage and generate ad variations automatically. And they are able to test campaigns at scale, and optimize marketing budget and performance. 

Other applications of AI and neural networks range from machine translation and music generation to coding, medical diagnosis and drugs discovery. 

And on the horizon is the emergence of Artificial General Intelligence (AGI). This is a form of AI that possesses human-like cognitive abilities, which some experts anticipate could materialize within the next five years. 

So how is all this spectacular progress in AI relevant to the CPG industry? 

AI developments and CPG 

CPG organizations are under pressure to be more efficient and do the right things with the least amount of effort. They are looking for ways to be more agile and react faster to the market and shifting shopper behaviors. 

Dedicated software applications help them do that by centralizing and analyzing data, streamlining workflows, and automating processes. Even without AI, this is a giant step forward compared to manual processes and error-prone spreadsheets. But SaaS software such as Visualfabriq takes this to the next level with unlimited scalability and embedded AI, which can make life easier for CPG teams, supporting them in a wide range of areas, such as: 

  • Data cleansing and harmonization 
  • Claims handling (an area where information tends to be “fuzzy”, something that AI handles well) 
  • Planning and tracking activities (a process that happens repeatedly in CPG firms) 
  • Demand forecasting (where it brings consistency as opposed to human biases and variability) 
  • Simulations (where it can bring fresh approaches) 
  • Smarter decision-making (AI is self-learning and can process more information than a human brain can hold) 

Is AI perfect? No, but it’s getting better and better. And CPG is an industry where it can be leveraged without running unacceptable risks. In high-stakes scenarios like self-driving cars, even a 99% success rate would be too risky, as the 1% failure could be fatal. Conversely, in CPG, a 99% success rate in, for example, accurately predicting promotions is spectacularly good, as the impact of a single failure is less severe and can provide valuable lessons for future campaigns. The focus is on maximizing success while learning from the minimal failures.  

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Our vision of AI in CPG: active guidance 

The data within CPG software holds the potential to unlock new insights and enhanced performance, but this requires dedicated effort. And it’s in human nature to choose the easiest course of action and just repeat what worked in the past. Unfortunately, this tends to lead to diminishing returns. Successful organizations, therefore, often have Revenue Growth Management (RGM) managers who proactively engage with teams to challenge complacency and drive improvement. But the ability to implement such hands-on approaches varies with the organization’s scale. Larger consumer-packaged goods companies may struggle to apply these methods in every market. Smaller organizations may have even less capacity for such a pro-active approach.  

That’s why our goal at Visualfabriq is to create an AI ‘copilot’ that serves as a supportive and intelligent partner, offering human-like, constructive suggestions for alternative promotion plans and improved performance. This AI assistance is designed to be a non-intrusive, smart collaborator that provides the best ideas, leveraging data insights and predictions within the platform.  

Our AI ‘copilot’ is not meant to be daunting but rather a friendly, active interlocutor that works with you, ensuring that you remain in full control. It’s like having a wise advisor who understands your needs and guides you towards optimal outcomes, without ever taking the wheel out of your hands. 

This active guidance is inclusive, catering to users of all analytical skill levels and educational backgrounds. It’s built to maximize the value extracted from the system, benefiting diverse regions and organizational types. Whether you’re a seasoned analyst or new to data-driven decision-making, our AI ‘copilot’ is there to assist, not to overwhelm. 

As a scalable SaaS platform enriched with AI, we aim to offer a consistent, personalized experience, providing the flexibility to gradually introduce new capabilities. Users can embrace AI-driven suggestions at their own pace or continue using the system in the traditional way. So that they can enjoy a comfortable and empowering journey into the world of AI-enhanced analytics. 

Our commitment is to empower you with AI that supports, collaborates, and inspires. It’s about enhancing your capabilities, not replacing them. And about making the complex simple, so that you can focus on what you do best. 

For a deeper dive into this topic and a discussion of alternative AI scenarios, you can watch the webinar on demand: “The future of AI for Revenue Growth in CPG: Exploring next-generation technologies and trends.” 

Prefer a more hands-on approach?