Creating products and experiences with AI

Happy Thursday, Collaborators!

What does the future taste like?

Monk fruit? Metal? Slurm? 

“How does the future taste?” is one of the odder questions we’ve seen generative AI answer (and that is really saying something). However, as we’ll see today, sometimes the weirdest ideas create marketing magic. 

Let’s get into it. 

-Mariah

The sugar-free jokes in this email were entirely written by humans.

This is part II of our series on the ways Coca-Cola uses AI to boost sales. Missed part I? Check it out here.

The Brand: A Sweet Existential Crisis

Coca-Cola is one of the world’s most powerful brands, with a brand value of $106.1 billion. Yet, the past few years have been tough for Coca-Cola. 

One of the biggest reasons is sugar. 

Demand for soda has fallen over the past 20 years, mainly due to health concerns about added sugars.  Recent research has linked added sugar to obesity, heart disease, stroke, and other medical conditions.

The American Heart Association’s daily limit on added sugar for women is equal to the amount of sugar in a single, 7.5-ounce can of Coke. Coke is the go-to example of a drink with too much sugar.

At the same time, the sugar-free beverage market is skyrocketing. The market is expected to grow from $125.3 billion in 2023 to $243.5 billion in 2030.

The immediate future has a distinct aftertaste of artificial sweeteners.

The Challenge: Attracting a New Generation

Coca-Cola has pivoted to developing low-calorie and sugar-free beverages. However, added sugars aren’t the only headwinds the company faces.

One of Coca-Cola’s top marketing channels - TV advertising - is also declining. The younger consumers Coca-Cola needs to secure the brand’s future don’t watch TV. 

Coca-Cola responded by shifting its focus to digital marketing. The company’s digital spend has increased from 30% to 60% of total media spend in the past four years. 

Coca-Cola is also exploring more creative, experiential campaigns.

“Coke will move away from primarily broadcast communication to creating an ecosystem of experiences for our consumers and people everywhere,” said Selman Careaga, then president of the global Coca-Cola category.

Coke’s response to shifting consumer preferences in beverages and media are both crucial to the brand’s longevity.

The Solution: AI Experiences

Coca-Cola is turning to a surprising source of longevity: cutting-edge technology. 

The company became one of the first major multinationals to appoint a global head of AI. Early this year, they partnered with Bain and Company to find innovative ways to use generative AI in marketing. 

They created an AI-assisted video ad and built a generative AI tool. 

But Y3000 might be Coca-Cola’s most ambitious AI campaign yet. 

Y3000 Zero Sugar

So, what does the future really taste like?

In their latest campaign, Coca-Cola asked AI to find out. The team analyzed responses from global fans on how they pictured the future. They added insights from AI to create new flavors: Y3000 and Y3000 Zero Sugar. The flavors imagine what the year 3000 feels, looks, and tastes like.

“We started with generative AI to produce a mood board and ultimately help us design the packaging and the identity,” Javier Meza, Coca-Cola’s SVP of European Marketing, told Adweek. “It has this lovely combination of human intelligence with AI, which I believe is also the future of AI.”

The experiential component of the campaign is equally imaginative. A QR code on the Y3000 packaging links to the Coca-Cola Creations Hub, which shows consumers what the future could look like. With a little help from generative AI, the experience transforms a photo the user takes into a futuristic landscape.

Naturally, there is also merch. Coca-Cola partnered with Ambush, a fashion brand, to create products inspired by consumers’ futurescapes. The Y3000 x Ambush Capsule Collection was released on October 17.

The Results

Y3000 launched a month ago, and results are still coming in.

That said, the new flavor got a shoutout in Coca-Cola’s Q3 earnings call: “Coca-Cola Y3000, the world’s first futuristic flavor created with AI. The launch has demonstrated strong initial results.”

Overall, Coca-Cola outperformed its Q3 predictions and raised its full-year revenue forecast. The company’s growth was partly driven by a 3% increase in sales of Coke Zero Sugar from July to September 2023.

The Takeaway

Generative AI has so many uses in marketing beyond creating copy and imagery. With some good, old-fashioned human creativity, AI can co-create new products and experiences for your audience. It can even show them the future.

“There’s been a lot of rushing to embrace [AI],” says Meza. “But we believe it’s an opportunity to amplify humans, not replace humans.” 

The key to success in AI marketing is the same as traditional marketing: do what no one else is doing. As other companies seek to replace humans with AI, Coca-Cola is reaping the benefits of collaboration.

Empowering creators like the designers at Ambush and the Create Real Magic contestants has added benefits for Coca-Cola. As Coke gives influencer creators the tools to make and share AI art from their collateral, Coca-Cola’s marketing materials reach a wider audience.

Take a moment to think. How can you work with AI to create a unique experience for your audience?

Want to brainstorm together? Reply to this email!