Will AI transparency be the next big CPG claim?

Woman doing grocery shopping in supermarket
Source: Getty Images/ Tang Ming Tung (Getty Images)

CPG companies must expand transparency efforts beyond sustainability to include emerging technologies like AI to win over concerned consumers, according to research from Ingredient Communications.

In a survey of 1,040 UK and US consumers commissioned by Ingredient Communications and conducted by SurveyGoo, 83% of shoppers said companies should declare if a food or beverage is designed or manufactured with AI.

Almost two-thirds (64%) of shoppers believe foods and beverages made with AI should not be considered “natural,” while only 12% disagreed with that. Most consumers (78%) went so far as to say that the government should regulate food and beverage companies' use of AI, with only 6% arguing against regulations.

Almost half (44%) of consumers said products made with AI are less safe to consume, Ingredient Communications reported. Also, 29% of shoppers said that they would be less likely to purchase AI-created products, compared to 26% who said that AI would increase their likeliness to buy a product, according to the survey.

AI drives growth in food, beverage

Currently, AI is used across the food and beverage industry to create engaging marketing assets and inspire product innovation and development.

CPG companies and retailers using generative AI — a set of AI-based technologies that can create text, graphics, videos and more — are seeing increased revenues, Google shared in a report of 376 senior executives. Revenues for more than half (57%) of companies increased 6-10%, and increased by more than 10% for 30% of companies. Revenues for an additional 13% grew 1-5%.

AI acceptance comes down to age, as distrust in the food & beverage industry remains

Acceptance of AI in the food industry was split by age demographic.

More than two-thirds (65%) of Gen Zers and 57% of millennials felt positive about AI in the food industry, Ingredient Communications reported. Older generations were far less likely to approve of AI in the food and beverage industry, with 44% of Gen Xers and 25% of Boomers feeling positive about the technology, Ingredient Communications added.

For a lot of older consumers, many of whom grew up in the era of the Terminator movies, AI is scary stuff, and there is a distinct risk that misinformation might spread among this demographic so that we wind up facing a new GMO-style public panic.

Richard Clarke, owner and managing director at Ingredient Communications

Consumer distrust of the food and beverage industry remains strong, as shoppers raise concerns about food safety amid various food recalls, like the Boar’s Heads recall due to a listeria outbreak.

A Gallup survey of more than 1,000 consumers found that 41% of respondents trusted the US federal government “a fair amount” to keep food safe in 2024, the lowest percentage in 24 years. Additionally, 16% of shoppers said they have “a great deal” of faith in the government’s ability to keep food safe, a 1% increase from 2019, Gallup reported.

This distrust is creating problems for CPG companies adopting AI, Richard Clarke, owner and managing director at Ingredient Communications and analyst on the report, told FoodNavigator-USA.

“It does not surprise me that there is an acceptability chasm between the youngest consumers and the oldest in terms of AI. Younger consumers will always be more willing to engage with new tech, and AI is no exception. Many younger consumers will already be using AI seamlessly in their lives, and anyone alive now who is between the ages of 0 and 8 can probably already be described as an ‘AI native,’” Clarke elaborated.

He added, “For a lot of older consumers, many of whom grew up in the era of the Terminator movies, AI is scary stuff, and there is a distinct risk that misinformation might spread among this demographic so that we wind up facing a new GMO-style public panic.”

‘It is important for food companies to control the narrative now’

CPG companies seeking to lessen AI concerns must devise transparency initiatives and communications plans to demonstrate the benefits of the technology, Clarke noted.

“It is important for food companies to control the narrative now and ensure consumers understand the ways in which AI is used in the food industry in order to avoid problems further down the line,” Clarke elaborated.