Consumer-packaged-goods (CPG) companies are increasingly adopting artificial intelligence to drive digital transformation, with 71 percent of CPG leaders using AI in at least one business function in 2024, up from 42 percent in 2023. However, despite this growth, no CPG player has fully scaled its AI capabilities, particularly generative AI. While gen AI could increase economic impact by 15 to 40 percent, traditional AI remains the primary driver of value, offering up to seven times higher potential impact. Companies must focus on a broad spectrum of AI technologies to unlock the full potential of digital transformation.
Research reveals that digital and AI innovations in CPG can add significant value across core functions and six innovation zones, including consumer insights, product development, and customer management. For example, AI-powered sentiment analysis and predictive trend sourcing have already helped CPG companies reduce product development time by 60 percent. In the beauty industry, AI-enabled personalization tools have improved direct-to-consumer experiences, increasing sales and market share. As CPG companies navigate this technological shift, adopting ecosystem partnerships and leveraging first-party data will be crucial for long-term success in a competitive landscape.
