The Power of AI in Boosting Sales: Case Study of Calbee's Potato Chips

The Power of AI in Boosting Sales: Case Study of Calbee's Potato Chips

In today's highly competitive market, companies are constantly searching for innovative ways to increase sales and gain a competitive edge. One such company that has successfully leveraged the power of artificial intelligence (AI) is Calbee, a leading snack food manufacturer in Japan. By utilizing an AI-powered web service called "Package Design AI" developed by the company Plug, Calbee was able to increase its potato chips' sales by a staggering 1.3 times.

So, what exactly is this Package Design AI? Simply put, it is a web service that uses AI to predict design evaluations based on uploaded images. It can predict the image's perceived qualities, such as cuteness, kindness, and seasonal appeal, by utilizing 19 predetermined keywords commonly used in package design evaluations (18 for non-food products). The main outputs of this AI service are the predicted favorability score, heatmap, image keywords, and favorability distribution.

What makes this AI-powered tool remarkable is its ability to evaluate package designs within a mere 10 seconds, thanks to its training data of over 5.9 million samples. This rapid evaluation is particularly crucial in today's fast-paced market, where companies strive to bring desired products to consumers as quickly as possible.

The Evaporative Cooling Effect and its Impact on Social Software Design

Moving away from the world of snack food, let's delve into the realm of social software design. Many social platforms struggle to retain active and high-quality user communities, often due to what is known as the Evaporative Cooling problem. This problem arises when the people who are most eager to meet others are the ones who encounter the least interest from potential connections.

This fundamental principle is often overlooked, leading to the gradual decline in the overall quality of the community. As high-value contributors become disenchanted with the lackluster community, the average quality of the group decreases. Eventually, the community reaches a point where it consists mainly of individuals who are oblivious to their mediocrity. This phenomenon aligns with what is known as the Groucho Marx rule, where individuals stop participating in events that would accept them.

One of the major drivers of the Evaporative Cooling effect is the openness of the community. When anyone can join a community, it becomes more likely that individuals below the average quality will join in hopes of gaining something. Unless managed effectively, these newcomers can harm the overall health of the community in the long run.

Addressing the Evaporative Cooling Effect: Social Gating and Unequal Roles

To counteract the negative impact of the Evaporative Cooling effect, social platforms can implement mechanisms known as Social Gatings. These mechanisms allow participants to self-select out of the group, ensuring that only those genuinely interested in contributing to the community remain.

Additionally, introducing unequal roles of participation can help shift the power dynamic and combat the evaporative cooling. When a community is small, these processes can be managed through the social layer, where high-value participants receive recognition and reputation from the community. However, as the community scales, these social mechanisms often break down, leading to the loss of special recognition for high-value members and accelerating the Evaporative Cooling effect.

The Success of Facebook: Scaling with Quality

In the realm of social media, Facebook stands out as one of the most successful platforms when it comes to scaling while maintaining quality. One of the primary reasons for its success lies in its design, which allows each user to have control over their own experience. When a random person from Brazil participates on Facebook, it has a negligible effect on other users' experiences because each user only sees their own corner of the platform.

Facebook's design can be categorized into two fundamental patterns of social organization: plazas and warrens. In the plaza design, every person's interaction is seen by every other person, creating one contiguous space. On the other hand, the warren design breaks the space into smaller segments, with users limited to their current warren and only able to explore adjacent warrens.

Both plazas and warrens have their unique trade-offs. Warrens are notoriously challenging to kickstart, as new users may struggle to connect with active hubs. In contrast, plazas have the advantage of being visible, making it easier to understand and monitor the community. However, warrens offer the advantage of near-perfect scalability, allowing communities to grow without sacrificing quality.

Taking Action: Three Tips for Building and Sustaining a High-Quality Community

1. Implement Social Gatings: Consider implementing mechanisms that allow participants to self-select out of the community if they are not genuinely interested in contributing. This will help maintain the overall quality of the group.

2. Foster Unequal Roles: As your community scales, find ways to recognize and reward high-value participants to prevent them from feeling undervalued or overlooked. This can help combat the negative effects of the Evaporative Cooling problem.

3. Design for Scalability: When building a social platform, consider the advantages of both plaza and warren designs. While plazas offer visibility and easier community understanding, warrens allow for near-perfect scalability without sacrificing quality. Find the balance that best suits your platform's goals and target audience.

In conclusion, the power of AI in driving sales and the challenges of maintaining high-quality communities in social software design highlight the importance of thoughtful and strategic approaches. By leveraging AI tools like Package Design AI, companies can gain valuable insights and make data-driven decisions to improve their products' appeal. Simultaneously, social platforms must carefully consider the dynamics of community building, implementing mechanisms to combat the negative effects of the Evaporative Cooling problem and designing for scalability while maintaining quality.