Ayako Tanaka, a Japanese Instagrammer who focuses on fashion and motherhood, has 168k followers on Instagram. While modest compared to numerous influencers with many more followers these days, Tanaka curated a two-day pop-up shopping event during which she supposedly generated as much revenue as a flagship store of a major international apparel brand would on its opening day.
A decade ago, it was inconceivable that an individual with adequate reach could sell as much as a major brand with a significant amount of awareness. What has happened over the last decade that makes this possible now?
With the advent of generative AI, we find ourselves in the midst of another paradigm shift. It's as if the operating system of human civilization is going through an upgrade right before our eyes. Now, in 2023, individuals can outsell institutions, and it may be the end of brands as we know them.
According to Japanese historian and podcaster Ryunosuke Fukai, advancements in information and communication technology result in an upgrade of the "Cognitive OS of human society". These technologies have influenced and even distorted our perception of the world, leading to an upgrade of our Cognitive OS.
In recent years, we have witnessed the emergence of several new technologies, such as NFTs and the metaverse, which were perceived as upgrades to our OS. However, it remains unclear whether these were just short-lived frenzies caused by the COVID-19 pandemic or whether they were simply too early for society to adapt. For now, they do not seem to be the upgrades that some had hoped for. Instead, it appears that generative AI is the technology that is truly triggering an upgrade to our civilization.
Brand Shift: Four paradigm shifts to remain relevant
To keep up with the next upgrade to our Cognitive OS of human society, here are four paradigm shifts that can guide us from the Connected Age to the Intelligent Age.
From Organizational Scale to Functional Speed
NYU Stern School of Business professor Scott Galloway writes in his book and on his blog Post Corona that "[American Football] Hall of Fame wide receiver Jerry Rice wasn't that fast, but he had 'functional speed,' the instincts to accelerate or decelerate when it mattered most."
Companies, particularly in the tech sector, have been praised for mainly one thing: growth. However, AI will allow companies of all sizes and individuals to scale and speed themselves in ways that were not possible before, rendering Organizational Scale less praiseworthy than before.
Take OpenAI and Google, for example. OpenAI had been around for several years, but it was not a household name by any means. The release of ChatGPT in late 2022 changed that overnight, and all of a sudden, the behemoth that is Google got caught on its back foot. Within less than six months, Google announced a slew of AI products and developments, taking back control of the AI narrative. Google realized it needed to accelerate immediately.
It is not only Tech giants has Functional Speed
During the COVID-19 pandemic, restaurants were hit particularly hard, forcing even the most well-regarded establishments to shut down. One of the restaurants that survived the pandemic by turning on its Functional Speed is Narisawa, a Michelin-star restaurant in Tokyo that is consistently ranked in the highly coveted World's 50 Best Restaurants list. The restaurant was known for the originality and theater of its presentation, which obviously wasn't of much use when restaurants were legally forced to close.
Chef Narisawa quickly redirected his staff to turn their elaborate culinary creations into omakase bento boxes that were delivery-friendly yet highly exclusive. He priced these boxes at more than £100 per person, a premium price that could potentially deter many customers. He reasoned that even during the pandemic when people couldn't go out, they still had occasions to celebrate and deserved to experience high-end meals at home. While staying true to his philosophy, Chef Narisawa accelerated the speed of his business when it mattered most.
From Transaction to Conversation
Since the arrival of e-commerce in the 1990s, the basic mode of online shopping has stayed largely unchanged. This mode has centered around three actions: searching, filtering, and selecting, making the nature of e-commerce between a business and a customer transactional.
In late 2022, ChatGPT surprised the world by showing that natural conversations between humans and machines could be convincingly realistic. It's suddenly become easy for anyone to imagine that services such as online customer support and chats can now be replaced by AI. What used to be purely transactional can be more conversational, possibly strengthening the connection between the business and the customer.
It turns out that the shift from Transaction to Conversation had been happening for a while. Social networks and messaging services have both been growing steadily for the better part of this century.
Messaging Apps Have Surpassed Social Networks
However, the growth of messaging started to gain momentum. In 2015, the number of active users of Big Four messaging apps (WhatsApp, Messenger, WeChat, Viber) surpassed that of Big Four social networking apps (Facebook, Twitter, Instagram, Twitter). When asked what people value most in their customer experience and will pay more for, "efficiency," "convenience," and "easy payment" rank high. At the same time, "friendly service" and "knowledgeable service" score equally high, indicating that it's not just the transactional aspects of commerce that people value.
It's already possible for us to have fairly natural conversations with AI on just about anything. In the next two to three years, it will be entirely possible for machines to provide friendly and knowledgeable services that are as good as, if not better than, those provided by humans in the form of conversations.
Aim for effectiveness, not just efficiency, in every transaction with your customer. Mercury provides social and chat commerce fully integrated into our e-Commerce platform.
From USP to POV (Product Selling to Story Telling)
By definition, a Unique Selling Proposition (USP) is "the feature or the perceived benefit of a good which makes it unique from the rest of the competing brands." However, as we move from the Connected Age into the Intelligent Age, it is becoming increasingly easier to mimic and copy others blatantly. With generative AI, not only can one simply copy prompts and get similar outputs instantly, but they could also ask AI to reverse engineer how things are made.
It was important for any product to have its USP, but a clear Point of View (POV) is getting more important. High-end gastronomy traditionally is not suitable for takeout or delivery. However, Chef Narisawa's POV, which captured gastronomy and environmental issues in the same context, remains unchanged for many years and even during a pandemic. Chef Narisawa, with his conviction in Satoyama Cuisine, designed not only a menu fit for high-class takeout and delivery but also a series of original packaged ingredients that could be sold online. This led to the creation of a new line of business for Restaurant Narisawa.
Another case in point of view is Ayako Tanaka. The fact that she is able to generate the kind of revenue that was only possible for major brands less than ten years ago shows the structural change we are witnessing. The power dynamic is shifting from institutions to individuals. Her followers/fans buy into her POV, thus they buy products because they are endorsed by her.
From Generative AI to Creative AI
The good news with generative AI is that "the distance between your idea and execution has been collapsed to nothing." People no longer need years of training to create technically advanced imagery, and that has now raised the quality of what we previously perceived as average. The bad news? "It’s clear mediocrity is now free. People that have no discernible artistic talent can create something that's actually pretty good."
Many people talk about the creativity, imagination, and life experiences of humans that AI can’t replicate. Just look at the picket signs of the writers' strike going on. But resistance is futile, so how specifically should we partner with AI to make the impossible possible?
First, reach. (languages)
Hybe, the Korean entertainment juggernaut behind enormously successful BTS and other K-pop groups, recently announced the first single "Masquerade" from MIDNATT, a new artist that the label is backing. What was new and special about this debut song is that it was produced in six different languages: Korean, English, Japanese, Chinese, Vietnamese, and Spanish. By releasing the song in multiple languages, Hybe is enabling the kind of reach for its artists that wasn't possible a few years ago.
Second, efficiency.
The creative process can change and speed up dramatically. For "Adventures in A-Eye," it took a week of Pum-and Pum only-to type in a bunch of prompts into Midjourney to generate the initial idea. In a week or so, the campaign was more or less fully visualized, and she was able to present almost finished work. The following two to three weeks, she worked with her team to finesse how the glasses and typography would be represented in the final imagery, taking merely four weeks for the whole process.
Typically, the process to develop a campaign of this caliber and quality from idea to execution takes several months, many people, and quite possibly half a million dollars.
It is good news for middle-aged creatives: Instead of fighting against this tidal wave of generative AI, learn how to surf and gain the kind of creative edge you didn't have before.
Third, magic.
This is the most important aspect of Creative AI and probably the most elusive. But what's behind magic is logic. Magic is about using logic to create an illusion and wow people. AI is quickly taking away from humans the work of generating and even crafting something. So the job that's left for humans is to imagine what magic to create.
Say hello to the Intelligent Age.
Contact us to learn how our Generative AI platform can help you embrace the Intelligent Age.