Are brands coming to our homes via AI?

As artificial intelligence continues its march into the heart of marketing and advertising, consumer brands in India are standing at the cusp of a transformation. The recent partnership between Mattel and OpenAI, which aims to infuse AI into iconic toy brands, is just one example of a broader trend that is rapidly reshaping how brands connect with consumers.

According to recent industry research, retail and consumer brands are set to increase their AI investments by 52% in 2025, expanding AI use from IT into customer service, supply chain, and marketing. This surge is driven by the recognition that AI-driven partnerships can unlock new business models, deepen emotional connections, and future-proof relevance in a world where digital-first engagement is the norm.

From Personalization to Predictive Engagement

For marketing specifically, the AI market is worth $47.3 billion in 2025 and is forecast to surpass $107.5 billion by 2028, expanding at a 36.6% CAGR. The agentic AI market is rapidly growing as well, estimated at $5.7 billion in 2024 and expected to balloon to $187.5 billion by 2034, with a CAGR of 41.7%.

The promise of AI lies in its ability to deliver hyper-personalized experiences at scale. Shradha Agarwal, Cofounder and Global CEO of Grapes Worldwide, captures this shift succinctly: “With AI making strong inroads into the A&M industry, it comes with a lot of potential to redefine consumer engagement strategies in the future.

Brands will have to be agile enough to adapt to the changing dynamics to stay ahead of the competitive curve in the industry. The AI-brand partnership will enable hyper-personalization with the help of real-time data, which will boost the prospects of connecting with consumers at a deeper level.”

This is not just theory. Coca-Cola’s “Share a Coke” campaign leveraged AI for personalized bottle designs, resulting in a significant boost in sales and social media engagement. Similarly, Starbucks uses AI to analyze customer purchase history and preferences, enabling highly targeted email marketing campaigns that drive engagement and sales. These examples highlight how AI can help brands move beyond one-size-fits-all messaging to deliver content and offers that feel bespoke.

Russhabh R Thakkar, Founder and CEO of Frodoh, adds another layer to this narrative: “AI-driven partnerships won’t simply optimize engagement but they will fundamentally reset how brands interact with their audiences. Real-time personalization, adaptive content, and rapid feedback loops are quickly becoming the new standard. For Indian brands, scale is a strategic advantage: mobile-first consumers, multilingual audiences, and exceptionally high engagement levels offer massive potential.”

Indeed, the Indian market presents unique opportunities and challenges. The rapid adoption of mobile technology, coupled with the diversity of languages and cultural contexts, makes the country a fertile ground for AI-driven innovation. However, as Thakkar points out, “significant challenges remain—fragmented data ecosystems, uneven digital access, and the urgent need to design for inclusivity from the outset.”

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