Michael Connor on the Impact of Generative AI in Consumer Goods

Generative AI is redefining the landscape of the Consumer Goods industry, offering innovative ways to engage with customers and personalize their experiences. Michael Connor, a seasoned expert in AI solutions, shares his insights on how generative AI is reshaping the industry. From personalized marketing strategies to ethical considerations, Connor highlights the potential of AI to create more intimate and meaningful brand experiences. This interview delves into the transformative power of generative AI, offering a glimpse into the future of marketing where technology meets creativity.

Q: Let’s start with an introduction. How did you get started in the industry? What has your career trajectory been like? 

A: Absolutely; I’ve got a new role that I’m excited about over the last few months. I’m leading Generative AI Solution Development globally for Amazon, where we focus on customers in different verticals. Of course, I came from Consumer Packaged Goods (I was at Coca-Cola for ten years living in Atlanta.) Technologists aren’t always thoughtful about the customer, their business, and the business problems they’re trying to solve. So, my group is focused on industry customers and what they are trying to do. It could be marketing, manufacturing, or supply chain; how do we help give them technology that solves a problem rather than technology for the sake of technology? Before that, I was leading our CPG group. I love brands; I just love the marketing and the storytelling. It was a lot of fun.

Q: What are some of the most innovative uses of Generative AI you’ve seen in the Consumer Goods sector to date? 

A: Generative AI tech is so transformative that it will affect every area of business, but I’m seeing marketers use generative AI for advertising. Most marketing companies saw people in terms of a segment (you are male/ female, 18 to 24, and live in the Southeast) because breaking people into very granular groups was hard. Many marketers are now using generative AI to get scale they could never get before. Now, they’re able to look at me as a person instead of me being a segment with 8 million other people. It’s Michael Connor, who lives in Atlanta, loves mountain biking, and has a 12-year-old daughter.

Now, brands can have this highly intimate conversation, which we always wanted. We always wanted to talk to you, have this relationship with you, and develop this powerful brand experience. It’s something that was a dream. And now, these tools allow us to create a product photo specific to you. If you’re looking at food, we can call out that it’s keto-friendly, gluten-free, or organic. It’s really being thoughtful about who you are, what you’re passionate about, and what matters to you, and then talking about the product in that light. I see marketers doing advertising, merchandising, and even data analysis to get to know their customers better.

Q: What ethical considerations must marketers consider when employing Generative AI, especially concerning data privacy and the authenticity of AI-generated content?

A: I have conversations with executives about that daily; I’ve met with over 1,000 execs, C-suite, and board members over the last year. And that is probably one of the top three things we discuss. Artificial intelligence hallucinates and replicates human bias. So, the models have picked up and learned all of the biases that exist on the internet that we humans have. When we’re asking them to generate things—visual or text-based—we see the same bias there.

I’ve talked to retailers who are considering using generative photos. Lego was recently in the news because some customers were concerned about generated photos being used, so brands worldwide are dipping their toes in. They’re wondering: ‘What is the value of authenticity?’ and ‘What’s our relationship with the customers?’ Some companies think that the opportunities and cost savings are too great, and they’re jumping in, especially smaller brands. Larger brands are much more concerned, though. I see some of the bigger brands I work with saying, ‘No, we’re not going to do it,’ while other brands just jump in with two feet.

The interesting thing happening is it’s leveling the playing field. Big brands had the top models, great photographers, great studios, money for shoots, and they could hire the best agencies. They could create collateral that a smaller company just couldn’t. Now, with generative AI, these small companies can build pretty beautiful images. That levels the playing field, and I think my big customers are asking, ‘Okay, now that the playing field is more leveled, what do we do? How do we then regain our advantage over smaller companies?’

Q: Where do larger brands go from here? How do they regain that competitive advantage?

A: I don’t know the answer, but like everything, I always have an opinion and a thought. I tell my customers that the playing field’s been leveled, and small brands can go out and do amazing things, including contract manufacturing. I have a friend who has a cereal brand, and she’s a national distributor (there are five people in her company). So, small brands can do some pretty incredible things. And to your point, the larger brands will have to think a little bit differently. And right now, they’ve been thinking about scale.

People will want smaller, niche brands that are more specific to them—maybe more influencer-based—and the larger companies will have to be more thoughtful about engaging with customers. Many CPGs don’t interact with the customers because they sell to a stadium, a restaurant, a grocery store, or a convenience store, and they don’t have that relationship. Then, they get data from places like Nielsen and IRI to get consumer insights. I just don’t think that that flies going forward.

A lot of CPGs are now going direct-to-consumer; retailers are actually starting to manufacture more. Data, customer relationships, and brand experience are important to me. I coach the brands I work with on being thoughtful and trying to innovate around connecting with the consumer. What do they want? What are they excited about? What are their passions? The tech makes it more possible than ever before.

Q: What advice would you give forward-looking companies looking to start their journey with Generative AI?

A: First, I would say that the world is their oyster. I mentioned my friend with a small cereal company; I had a talk in Cambridge with many brands, and she was there. I asked how brands use this tech, and she said they generate marketing copy, do social media posts, and create social media calendars. They’ve got chatbots online where you can talk to the avatars of their brand. She was willing to take a risk, and that’s really exciting. You then see larger brands often let small brands take those risks, see which ones are successful, and then acquire them and use their supply chain to scale out a successful brand globally.

However, these smaller brands can use these tools to do creative things, and no one is holding them back. I’m always coaching the larger brands on taking risks and not just sitting around and waiting to see how things play out. I believe Gen AI is one of the most fundamental discoveries in human history, right on par with the Gutenberg Press, electricity, personal computers, and the internet. And small brands have to seize the opportunity. It’s a really exciting time for them.

Q: Let’s talk about ChatEQ. What was the idea behind it?

A: I love talking about this! I was leading an engineering team of 60 people. As you can imagine, with a team of 60 engineers, the emotional intelligence was not terribly high. I noticed the way we spoke to each other, cut each other off, and overlooked people’s ideas wasn’t a great environment from a team culture standpoint. And it doesn’t matter how smart the people are; there’s just great power that comes from a good culture and the synergistic effects that come from a team that cares about each other.

Actually, I was talking to Joe Fuller—a Harvard Professor—in a meeting a few weeks ago. He was saying that the number one and number two reason for people being happy at work is their relationship with their boss and their relationship with their co-workers. I didn’t think we had that, so I started researching EQ, emotional intelligence, and empathy, trying to figure out if that’s something you can teach. It turns out that you can. So, I started teaching some people on my team these things. But I also realize that many people wouldn’t do what I did, which was to read 30 books and watch hundreds of videos.

A lot of us struggle with hard conversations, and when something does affect us in a hard way, how do we approach those things? The premise of ChatEQ was artificial intelligence that can help us think through how we’re feeling, how to connect with people that we care about, and how to talk to them in a way that leads to a productive conversation and keeps us out of the pitfalls of blaming, finger-pointing and making assumptions about other people’s thoughts. So, the technology caught up with the idea. The first time I started experimenting with it, it didn’t work, and then suddenly entered AI and I tried it again.

Right now, at chateq.com, there’s a live version—it helps people process traumatic experiences, or it can help mediate conflict between people and hopefully help us fix the things that feel broken in our relationships. When we look at mental health indicators, 24% of women over 60 are on antidepressants. The numbers are through the roof. I believe this technology can help solve some of these problems that we haven’t been able to solve. I’m really passionate about it, and I’ve seen it help people; it’s helped me. So, I believe this will usher in a new era for humanity.

Q:  What are the main hurdles in making AI more empathetic and nuanced in understanding human emotions?

A: One of the key things is empathy, but many people don’t really understand what that means. I’ll give people a tip. Empathy is just being with someone and hearing what they’re going through and just being in that space with them without trying to solve that problem, without trying to tell them it’s going to be okay, without trying to give them 10 strategies; it’s just holding space with somebody and helping them carry that weight. That’s it. And over and over again, we’ve seen that it has tremendous healing power. Most people believe that when someone’s hurting, going through something, or in conflict with someone, they need to be right or wrong or get some strategy.

We forget that empathy and connecting with someone are powerful; anything can happen from there. I don’t know if we have a lot of that these days, so teaching the AI how to do that was tricky.

Q: What are some common misconceptions about AI that you encounter, and how do you address them?

A: One of the most common misconceptions is that AI will take everybody’s jobs. Every time there’s been an invention in society, whether electricity, computers, or the Internet, everybody says it’s coming for the jobs. As human beings, it’s hard for us to imagine a different world where we’re doing different things. I don’t think it’s going to take everyone’s jobs. I was talking to a customer a couple of days ago, and they mentioned a word they use internally called “toil.” What percentage of the work in their company is called toil, where it’s not really interesting, not very meaningful, and doesn’t seem differentiated, but you’re toiling? I think we all have a certain amount of that. However, generative AI can take a lot of that toil. I don’t think we will all lose jobs, but maybe we can do more meaningful jobs.

Q: Is AI capable of being truly creative?

A: Yes, because I think our definition of creativity is loose. I’m a songwriter, but most of the things I write are a collection of my life experiences, songs I’ve heard, shows I’ve watched, and books I’ve read. I’m pulling these things together and writing or coming up with something novel. And so when I look at AI, it’s doing the same thing: it has billions of songs and all the information that humanity has collected over the last few digital decades. Then, it can synthesize that into something new. For me, that’s the definition of creative.

Q: Looking ahead, what emerging trends in generative AI do you believe will significantly impact the Consumer Goods industry?

A: Let’s say you’re gonna have a party at your house, and you have to go to the grocery store. You’ve got to think through different diets. Maybe you’re on a budget because you just went on a trip. How many people will be there, and what are the ages? If you’re gonna get things, you want to get versatile things. So you’re going to go to the store and make 200 micro decisions about all the different things. And so I think that generative AI will change things in many different ways because your life will be much more intent-based.

So you’ll share what the goal of your trip is or the goal of your party. Then, that retailer or brand can be thoughtful about you and give you options. So it could say, hey, based on what you said, here’s a couple of options you can click, and Instacart delivers it 20 minutes later. And that just saved you six hours. There are a lot of areas in our lives where the models can show some executive function.

And then this is where it gets really creative. When they know something about your finances, your family, your diet, and the things they like, there’s an element of trust in the data. The more data you can give the models, the more thoughtful it can be about what you’re looking for. So I think that will be a big shift affecting how we advertise, merchandise, planograms, everything.

Q: What is next? What technologies/ use cases will we continue to see Generative AI enable?

A: I use generative AI for everything I do now. It’s not that I don’t do anything, but I always collaborate with artificial intelligence as I do anything now. And it’s extremely powerful. If you have any questions, you can have this rich dialogue. When I think about really important disciplines, whether teachers, doctors, or psychologists—all these people who can enrich our lives—they can use this technology. They’re able to better help people.

We’ll see a step change in the pace at which we can do things. Of course, technology always reflects humanity, our best and worst. I’ve seen instances of fraud and hacking. There was a woman recently. Someone sent her a video of her CEO saying to wire 25 million dollars to this bank account, and she did. So you see some of the harmful elements of humanity and society also amplified by technology. But, overall, it amplifies the research and the work we’re already doing to make us better, move faster, and solve problems.

Q: What is the best piece of advice you’ve gotten in your career?

A: I think that the best advice I’ve gotten is to do something that matters to you, and if you do something that you care about, that’s important to you, that you believe in, it’s just easy to wake up every day, get excited about it and it doesn’t so much feel like work. In turn, when you interact with your co-workers, you’re happy and positive. And you create beautiful things when you’re doing something you’re passionate about. I’ve seen many people fall into the trap of trying to take that job because it pays well. So, I’ve seen some friends and people I know fall into this trap. Where are they really going? Well. They’re making a lot of money but are not very happy.

I’ve seen many successful, miserable people, and in a capitalistic world, we think that if you’re wealthy, things are great. That’s not the case. It’s again back to the connections—people who are powerfully connected to their co-workers, their friends, and their family—that’s what really seems to matter. So I think if you’re doing things you love, it’s really easy to make this connection, but It’s all about people and connection. That’s the only thing that really brings true happiness. I mean, I think we all need a roof over our heads. But those connections, relationships, friendships, that’s what I think we’re really missing as we fall into devices. They create the illusion of connectivity; there’s nothing like being out with friends. So I think that’s probably the best advice I’ve received.