The most in-demand AI skills — and how companies want to use them

From Mad Men to machines? Big advertisers shift to AI

By Richa Naidu and Martin Coulter | Reuters

LONDON — Some of the world’s biggest advertisers, from food giant Nestle to consumer goods multinational Unilever, are experimenting with using generative AI software like ChatGPT and DALL-E to cut costs and increase productivity, executives say.

But many companies remain wary of security and copyright risks as well as the dangers of unintended biases baked into the raw information feeding the software, meaning humans will remain part of the process for the foreseeable future.

Generative artificial intelligence (AI), which can be used to produce content based on past data, has become a buzzword over the past year, capturing the public’s imagination and sparking interest across many industries.

Marketing teams hope it will result in cheaper, faster and virtually limitless ways to advertise products.

Investment is already ramping up amid expectations AI could forever alter the way advertisers bring products to market, executives at two top consumer goods companies and the world’s biggest ad agency told Reuters.

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The technology can be used to create seemingly original text, images, and even computer code, based on training, instead of simply categorizing or identifying data like other AI.

WPP, the world’s biggest advertising agency, is working with consumer goods companies including Nestle and Oreo-maker Mondelez to use generative AI in advertising campaigns, its CEO Mark Read said.

“The savings can be 10 or 20 times,” Read said in an interview. “Rather than flying a film crew down to Africa to shoot a commercial, we’ve created that virtually.”

In India, WPP worked with Mondelez on an AI-driven Cadbury campaign with Bollywood superstar Shah Rukh Khan, producing ads that ‘featured’ the actor asking passersby to shop at 2,000 local stores during Diwali.

Small businesses used a microsite to generate versions of the ads featuring their own store that could be posted on social media and other platforms. Some 130,000 ads were created featuring 2,000 stores which gained 94 million views across YouTube and Facebook, according to WPP.

WPP has “20 young people in their early twenties who are AI apprentices” in London, Read said, and has partnered with the University of Oxford on courses focused on the future of marketing. The “AI for business” diploma offers training in data and AI for client leaders, practitioners, and WPP executives, according to WPP’s website.

The team work under AI expert Daniel Hulme who was appointed chief AI officer at WPP two years ago.

“It’s much easier to think about all the jobs that will be disrupted than all the jobs that will be created,” Read said.

Nestle is also working on ways to use ChatGPT 4.0 and Dall-E 2 to help market its products, Aude Gandon, its global chief marketing officer and an ex-Google executive, said in an emailed statement.

“The engine is answering campaign briefs with great ideas and inspiration that are fully on brand and on strategy,” Gandon said. “The ideas are then further developed by the creative team to ultimately become content that will be produced, for example for their websites.”

While lawmakers and philosophers alike still debate whether content produced by generative AI models amounts to anything like human creativity, advertisers have already begun using the technology in their promotional campaigns.

Imagined scenes

In one instance, Dutch gallery Rijksmuseum’s research team went viral online on Sept 8, 2022 after using X-Ray to reveal new objects hidden in Baroque artist Johannes Vermeer’s oil painting ’The Milkmaid’.

Less than 24 hours later, WPP used OpenAI’s generator system DALL-E 2 to “reveal” its own imagined scenes beyond the borders of the painting’s frame in a public YouTube ad for Nestle’s La Laitière — or Milkmaid — yogurt and dairy brand.

Through almost 1,000 iterations, the video of Nestle’s version of The Milkmaid generated 700,000 euros ($766,010) of “media value” for the Swiss food giant. Media value is the cost of advertising needed to generate the same public exposure.

WPP said the content cost it nothing to make. A spokesperson for the Rijksmuseum said it had an open data policy for non-copyrighted images, meaning anyone can use its images.

Nestle is not alone in its experiments.

Unilever, which owns more than 400 brands including Dove soap and Ben & Jerry’s ice cream, has its own generative AI technology that can write product descriptions for retailers’ websites and digital commerce sites, it said.

The company’s TRESemmé haircare brand has used its AI content generator for written content and its automation tool for visual content on Amazon.co.uk.

But Unilever is concerned about copyrights, intellectual property, privacy and data, Aaron Rajan, its global vice president of Go To Market Technology, told Reuters.

The company wants to prevent its technology from reproducing human biases, like racial or gender stereotypes, that might be embedded in the data it processes.

“Ensuring that these models when you type in certain terms are coming back with an unstereotyped view of the world is really critical,” he said.

Nestle’s Gandon told Reuters the company was “keeping security and privacy top-of-mind.”

Consumer companies are using data from retailers like Walmart, Carrefour and Kroger to power their AI tools, said Martin Sorrell, executive chair of advertising group S4 Capital and the founder of WPP.

“You’ve got two buckets of clients: one that is jumping in fully and the other that is saying ‘let’s experiment,’” he said.

Some consumer goods firms remain wary of security risks or copyright breaches, industry executives say.

“If you want a rule of thumb: consider everything you tell an AI service as if it were a really juicy piece of gossip. Would you want it getting out?,” said Ben King, VP of customer trust at Okta, a provider of online authentication services.

“Would you want someone else knowing the same sort of thing about you?,” he added. “If not, don’t tell the AI.”

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The 3 Most Undervalued Semiconductor Stocks to Buy Now: August 2023

InvestorPlace - Stock Market News, Stock Advice & Trading Tips

The red-hot semiconductor sector has cooled off recently as the artificial intelligence hype that fueled massive gains last year simmers down. Now, as the industry’s valuation multiples start plateauing from previously lofty levels, many hidden gem chipmakers seem primed for their time in the sun.

While headline grabbers like Nvidia (NASDAQ:NVDA) soaked up much of the attention during the AI craze, more underappreciated players in the space offer intriguing value now. The rising tide of digitization, AI, automotive electronics, and the metaverse mania will provide a tide that should lift many boats in the semiconductors space over the long haul. Investors just need to look beyond the shiny objects to find the most discounted tickets for that ride. Here are three.

Source: Pavel Kapysh / Shutterstock.com

Flying under the radar as a provider of specialized wafer cleaning tools to the semiconductor industry, China-based ACM Research (NASDAQ:ACMR) looks poised to ride powerful geopolitical trends accelerating domestic chip production, in my opinion.

ACM Research posted record Q2 2023 revenue growth of almost 39% year-over-year, driven by strong demand trends in mature node investments within China. Management called out the substantial gap between China’s domestic mature node capacity and genuine semiconductor consumption, which creates solid tailwinds for equipment suppliers like ACMR that have significant exposure there.

Additionally, ACMR is making strides with international expansion, having delivered its first evaluation tool order received from a major European semiconductor manufacturer last quarter. While regulatory risks associated with U.S.-China relations exist, I believe ACMR’s differentiated proprietary technology across wafer cleaning, electroplating, furnaces, and other areas gives it a strong, sustainable competitive edge both in China and abroad.

Trading at just around 10.6-times forward earnings, ACMR stock presents sizable upside potential if execution continues, especially given the favorable industry trends. The average analyst price target of $25.80 for this stock implies a massive upside potential of 91.4% from current levels.

Source: Sundry Photography / Shutterstock.com

Left behind during the pandemic bull market, Intel (NASDAQ:INTC) now trades at a bargain level compared to the broader semiconductor sector average. Over the past decade, Intel slowly lost process leadership to Taiwan SemiconductorManufacturing Company (NYSE:TSM) as manufacturing challenges mounted. However, under new leadership, Intel’s bold turnaround strategy aims to reorganize the current hierarchy of process technology companies, with Intel in the lead by 2025. It even had its CPU business under threat by AMD (NASDAQ:AMD), but thankfully, the company has started a turnaround here, too, with the company gaining market share.

Additionally, recent boosts to Intel’s foundry ambitions make me very bullish on its prospects. The announcements that Boeing (NYSE:BA) and Northrop Grumman (NYSE:NOC) are joining Intel’s Department of Defense program to develop next-generation chips domestically are huge. Furthermore, the CHIPS Act providing $52.7 billion of funding to bolster semiconductor manufacturing in the U.S. will likely support Intel’s ambitious plans to build new cutting-edge fabs stateside. In Q2 2023, Intel’s foundry revenue already grew over 300% versus last year, showing promising early traction.

Despite the near-term economic demand uncertainty, Intel reiterated its full-year 2023 guidance on its latest earnings call, signaling confidence in its ability to execute the product roadmap. The company expects to launch its Intel 20A node in 2024, which promises major performance and efficiency gains.

With its beaten-down valuation and progress toward achieving both IDM 2.0 leadership and foundry business growth, Intel deserves greater investor attention. Analyst price targets suggest as much as 87% upside from current levels, though the average target has been dragged down by a lowball $17 price target by Rosenblatt Securities.

Source: Shutterstock

As a leading radio frequency (RF) solution supplier, Qorvo (NASDAQ:QRVO) serves diverse end markets like defense, internet-of-things (IoT), automotive, and smartphones. Despite macroeconomic uncertainty, Qorvo’s latest design wins across radar, auto, and defense applications provide a solid base of business, in my view.

The company also looks well-positioned to me in higher growth segments like Wi-Fi 7, IoT connectivity, and silicon carbide power devices. Qorvo’s latest multi-million-dollar order for its silicon carbide chips shows its strong positioning to enable more efficient AI servers and data centers. Its Matter 1.1 smart home certification also significantly expanded its serviceable addressable market among top smart home ecosystem players, a segment I’m very bullish on.

Although Qorvo’s Q1 FY2024 results showed declines versus last year amid inventory adjustments across the supply chain, management expects demand recovery in the second half of 2023. Qorvo’s very strong cash balance of $744 million and reasonable debt load of $2 billion provide stability amidst market volatility. And given its leading market share in RF solutions, exposure to diverse secular growth drivers, and reasonable valuation around 20-times forward price-earnings ration, QRVO looks poised for upside in my view. The average analyst price target of $113.64 represents a modest 14% upside potential from current levels. It may not seem like a lot, but it is a far cry from the downside risk that most semiconductor stocks currently face.

On the date of publication, Omor Ibne Ehsan did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Omor Ibne Ehsan is a writer at InvestorPlace. He is a self-taught investor with a focus on growth and cyclical stocks that have strong fundamentals, value, and long-term potential. He also has an interest in high-risk, high-reward investments such as cryptocurrencies and penny stocks. You can follow him on LinkedIn.

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