#23: AI + Brand (Part II)

Story > AI

Last week in AI + Brand (Part I), we talked about how AI will challenge the status quo of how brands are perceived by consumers. With the wave of hyper-personalization through curated prompt writing, consumers will get used to asking a specific question and receiving one specific answer. You want to know what to wear to that special occasion with a funky theme? ChatGPT will tell you exactly which outfit to don and where to buy it from. And you might be surprised that today’s answers aren’t dominated by big brands. It’s niche names that evoke the theme you’re inquiring about. No more search results page of ten links that you must sort through, but an infinite long tail of possible answers to your question, packaged into one curated response. Search, as we know it, has been turned upside down for good.

So, what’s the point of building a brand if an AI algorithm will determine your fate?

I have a two-pronged answer for you.

1. Brand discovery happens both online and offline

2. The best brands are stories and it’s unlikely AI will replace great stories

To clarify, I see “building a brand” as creating a storyline and complementary content that communicates why your brand is differentiated from its competition. Brand building looks to create shared experiences for users of a product or service. Brands evoke emotion and allow consumers to feel that they can identify with the message of a brand.

Now, let’s tackle number one.

I find it fascinating that the hyper-personalization of search (ChatGPT) and social (TikTok, Instagram) have very different consequences for brand discovery. The former is likely to reduce the opportunity for brand discovery, while the latter should amplify it. Every time I open TikTok, I’m amazed with how quickly the algo adjusts based on my behavior. Watch a video of a mind-numbing dance a few times over? Well guess what, your next dozen videos will be other people performing that same trending dance.

TikTok and Instagram feed me brand advertisements with impressive specificity based on the content that I’ve engaged with. And sometimes content from consumer brands pops up on my feed too. Social platforms want to keep me in the app for as long as possible so they can sell me ads and products. So naturally, they’ll serve a video they think I’ll like. And that video may lead to discovering a new brand.

Even with all the blatant monetization, they still manage to serve content you’ll probably enjoy. Which enables the discovery of new brands, products, and ideas. In this instance, AI helps brand visibility, not hurts it. So, if you are looking to build a consumer brand, investing in social content is a baseline requirement. Consumers expect to discover new things on social media, so you need to be there so your brand can be discovered.

This does pose the question: if ChatGPT introduces advertisements, will that unlock brand discovery potential within LLM wrappers?

I think it does, but not in a super advantageous way for brands. Discovery then becomes a pay-to-play exercise (like selling on Amazon), which may create a moat for large brands with huge advertising budgets. On the other hand, this makes it tougher for challenger brands to break through and they’ll have to focus on picking up long tail opportunities with specific web content for answer engine optimization (AEO) purposes.

Furthermore, brand discovery also happens in person. Believe it or not, 84% of retail sales take place in person. That percentage shocks me, given how high offline sales are, however it’s worth pointing out that grocery and department stores count as offline sales. Although I buy most things online, I always go to the grocery store to buy food. And for CPG brands selling consumable products, grocery stores are an excellent place for consumers to discover your brand. ChatGPT isn’t getting rid of grocery stores soon.

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The best brands are stories. They create identities, they evoke emotions.

Nike’s “Just Do It” slogan and powerful video storytelling encourages you to be a person of action. And in similar vein, Adidas’ “Nothing is Impossible” brand ethos makes you believe that you can achieve anything. These motives help develop a narrative that consumers can identify with. You can say to yourself, “I want to be seen as someone who can do the impossible,” and then your wardrobe starts looking like an Adidas showroom as you want to express this ideal to the world. Regardless of technological innovation, I believe consumers will always express their identity through what they buy. They know that the clothes they wear or the serum they use says something about them to the outer world.

But at the end of the day, Nike and Adidas clothes are just clothes, commodities if you will. It’s their brand story that separates them apart from every other athletic wear brand. And by having such a clear, concise storyline their ethos doesn’t get lost. I recently read Contagious by Jonah Berger, where he remarks, “stories save time and hassle and give people the information they need in a way that’s easy to remember.”

Thanks to AI, consumers will continuously look for more efficient ways to receive answers. As per Jonah’s point, stories remain in vogue because they are engaging ways to transmit information efficiently and effectively. It further emphasizes the point that your brand story is your best bet at developing a moat in this increasingly AI-driven world.