Artificial intelligence is aiming to disrupt a 100-year-old industry.
Finding ways to attract consumers to buy packaged goods stretches back to the 1920s when American psychologist Daniel Starch created the world’s first market research study.
Today, the global market research industry is worth an estimated $87.7 billion and is expected to grow by another $15 billion in the next four years, with artificial intelligence’s rise one of the major contributing factors. One company hoping to lead that disruption is Ai Palette.
Founded in Singapore in 2018, the startup provides AI-powered market research with real-time predictive analytics. Rival firms include ZoomInfo Sales, Trajaan and Brandwatch Consumer Intelligence, all of which deploy a variety of technology to comb through consumer data and marketing trends.
Using more than 61 billion data points from 24 countries, Ai Palette’s platform – running for the past four years – generates new concepts for brands based on identified trends, transforming traditional market research in the process.
Somsubhra Gan Choudhuri, co-founder and CEO Ai Palette, said AI can take up much of the brain power usually done by people.
“For example, a company wants to launch a new juice in a market like Thailand, our platform will tell them what kind of juice they should launch, along with how they should position it, so that it is successful in the market,” he told CNBC’s “CNBC Tech: The Edge.”
“And we do that using the power of artificial intelligence by analyzing the big data around food to identify what are the latest trends out there,” he added.
Before co-founding Ai Palette, Choudhuri worked in the fast-moving consumer goods (FMCG) industry.
He said firms are increasingly unable to keep up with fast changing consumer tastes and are unable to predict popular trends from one year to the next.
“That’s when I came across AI and machine learning. As I learned more about it, it became quite obvious to me that it’s just a matter of time before AI impacts every industry,” said Choudhuri.
Big manufacturers jump on board
Part of Ai Palette’s technology includes the ability to analyze as much as 39 different factors to predict the future trajectory of a trend.
That has caught the attention of some of the world’s major food and beverage brands, such as Diageo, Nestlé, and Pepsico.
Symrise, a company that works with brands to manufacture ingredients and products such as scents, uses Ai Palette to pull data from an array of sources, such as social media and online reviews. A single analysis is then published for the manufacturer to interpret.
Food brand Pringles, known for its flavored potato chips sold in 140 countries worldwide, also uses Ai Palette to understand snack preferences across four different markets. The platform has helped introduce localized products in the developing markets of Thailand and Indonesia.
Cereal giant Kellogg, meanwhile, used Ai Palette during the Covid-19 pandemic to trawl through online content from Malaysia, the Philippines, Singapore and Thailand in four languages. The cereal maker managed to identify trending recipes for foods and incorporated them into a new breakfast cereal, such as crispy calamari flavor.
Despite the technological advances, traditional methods remain a part of the process, said Conor Delahunty, vice president for Global Sensory & Consumer Insights at Symrise.
One vital element remains, so far at least, beyond the clutches of automation and technology.
“We still have to taste the product, because our artificial intelligence cannot do that yet,” said Delahunty.
Public and private backing
As AI development gathers pace, so does interest from investors. Venture capital firm 500 Global invests in entrepreneurs who it believes are building game-changing companies. It has supported over 2,900 startups with a combined portfolio valuation of over $300 billion.
Vishal Harnal, global managing partner of 500 Global, has his eye on startups with a “very specific sector” focus and that are “tackling big problems that no one is maybe looking at right now.”
Ai Palette ticked his boxes for an investment.
“What they really loved was that we are trying to disrupt a very large and traditional industry like the CPG [consumer packaged goods] industry where the companies are very traditional and there has not been much disruption,” said Choudhuri.
Along with VC investors, Ai Palette has had the backing of the Singapore government, which is committing more than three quarters of a billion Singaporean dollars ($7,500,000) to AI development to strengthen its AI ecosystem.
The startup also raised $5.7 million in a funding round in March, with funding going towards the expansion of its AI insights tool and a new “FoodGPT” chatbot.