Generative AI Is Everywhere, but Will Consumers Ever Fully Understand It?

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Artificial intelligence is not new—ELIZA was an algorithmic chatbot that was coded by a psychiatrist back in 1964. But it’s taken decades, not only for consumers but for brands, to understand the far reach of AI. Consequently, while the power of generative AI (genAI) will cast a wide net to reach consumers, employees, businesses, and society, consumer adoption of genAI won’t happen overnight.

A year and a half after the launch of ChatGPT, Forrester finds that, while most consumers have heard of genAI, the majority have yet to use it. According to Forrester’s March 2024 Consumer Pulse Survey, only 31 percent of U.S. consumers have used genAI; 58 percent have heard of genAI but have never used it. A relevant fact to keep in mind: According to Forrester’s December 2023 Consumer Pulse Survey, consumers are engaging with AI technology unknowingly—only 51 percent of U.S. consumers think that self-driving cars use AI technology, for example.

Consumer knowledge and understanding of genAI will continue to be fragmented, or nonexistent. Forrester’s ConsumerVoices Market Research Online Community respondents described the technology as either “machines acting as humans,” “technology creating new output with prompts,” or (more ominously) “something to distrust.”

Yet U.S. consumers are also ahead of other countries in their adoption and usage of genAI tools. This is largely due to the lack of federal regulations domestically; the EU has adopted the AI Act. Furthermore, large language models (LLMs) are based on available training data. Much of the data is in English, inherently making the output of genAI platforms more effective for English-dominant countries.

Aside from country-specific early adopters, awareness and usage of genAI also vary by demographics. Those who are more likely to have heard of genAI and to have used it tend to be younger, male, and more highly educated. Over time, gaps in awareness will narrow, but age and level of education will still likely differentiate usage rates, as much of the use cases might depend on a blend between personal and professional usages.

While consumers’ usage of genAI grows, their perception of it is a mixed bag. They see the potential positive effects of genAI, with 48 percent of U.S. consumers agreeing that it will make it easier to learn new things, but there’s also the 54 percent who believe that it will pose a serious threat to society. Furthermore, distrust is the default: Only 26 percent of consumers would trust information provided by genAI, and 76 percent of consumers believe that companies should disclose when they are using genAI to interact with them. It is worth mentioning that distrust comes in two forms: in the moral and ethics of genAI (e.g., how the data is derived and how it’s used) and also in terms of distrust in the quality or credibility of its output.

As companies race to incorporate genAI internally and externally, it’s essential to hop, not leap, into consumer-facing experiences. Here’s what companies should do to successfully innovate with genAI:

  1. Understand the underlying consumer need. GenAI is a vehicle, not the destination. It can assist, turbocharge, and enable—but it shouldn’t be the sole solution. Don’t get caught up in shiny objects; instead, dive into how genAI can solve an unmet consumer need within your brand or category.
  2. Experiment internally before launching externally. Many use cases with companies start internally (e.g., increasing employee productivity, software design, content creation, etc.). Generating and experimenting with use cases can help exercise the AI muscle, build stakeholder buy-in, and coach employees on how to use genAI responsibly.
  3. Set company guidelines and governance. With a plethora of free genAI tools available to anyone, such as ChatGPT or Google’s Gemini, it is very easy to input proprietary company information into publicly available LLMs (Samsung temporarily restricted usage of ChatGPT for employees, for example, after it discovered that an employee uploaded sensitive code to the platform). Defining a company policy and establishing standards for genAI use cases in vendor solutions will help guide employees on responsible ways to use genAI that can ensure proper oversight. 

Audrey Chee-Read is a principal analyst at Forrester. She will be speaking on generative AI and consumer trust at CX Summit North America in Nashville, June 17–20. Learn more.

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