Megan Harper
Prophet’s 2024 Digital Transformation Report, titled “The Rise of the AI-Powered Consumer”, delivers a compelling view into how generative AI is transforming consumer behavior across global markets. Drawing insights from over 2,400 respondents across five countries—including the United States, China, Singapore, the UK, and Germany—the report presents a timely assessment of how consumers are leading AI adoption, shaping new digital expectations, and forcing businesses to reimagine brand engagement and value delivery in the GenAI era.
Consumers Are Leading the Shift
The report finds that 45% of consumers across surveyed markets are already using generative AI tools—surpassing early adoption rates of smartphones and social media platforms. In Asia, adoption is significantly higher, with China at 60% and Singapore at 56%, underscoring the influence of regional infrastructure, mobile-first behavior, and tech-forward cultural dynamics. Unlike previous digital waves driven by companies, this shift is consumer-led, accelerating innovation from the outside in.
Entertainment as the Initial Gateway
Entertainment emerges as the top use case for GenAI tools. Approximately 33% of users cite applications such as idea generation, image and video creation, and creative writing. However, this early interest is rapidly expanding into high-impact areas: 63% of respondents report using GenAI for personal health monitoring—such as sleep analysis or fitness recommendations—while 62% leverage AI tools for financial planning and budgeting. These shifts point to growing trust in AI-powered support for decision-making beyond novelty.
Generational Engagement Patterns
Millennials are currently the most engaged group, with 53% actively using GenAI and expressing high levels of optimism. They tend to embrace AI as a productivity tool and creativity enhancer, while also demonstrating a willingness to explore paid use cases. Gen Z shows comparable usage but holds more nuanced views on AI’s ethical implications, such as data control, content authenticity, and bias in generative models. This cohort is vocal in demanding transparency and human oversight.
Transparency and Ethics Drive Loyalty
The demand for ethical AI practices is clear. Prophet reports that 82% of consumers expect brands to openly disclose how AI is used in products or services. Moreover, 66% identify data privacy as their top concern, especially in applications involving financial, health, or identity data. Trust has become a primary driver of loyalty, prompting businesses to incorporate explainable AI (XAI), opt-out mechanisms, and ethical usage disclaimers. Without these safeguards, even well-designed AI products risk losing credibility.
Strategic Implications for Businesses
This shift in consumer expectation signals a deeper transformation in brand-customer dynamics. Businesses must now design for a GenAI-native consumer: one who expects real-time personalization, AI-powered convenience, and brand ethics. For many companies, this will require revisiting digital strategy foundations, enhancing AI transparency, and building teams capable of balancing innovation with governance. For an example of how startups are already adapting, see our interview with Aimdoc founder Ben Skoog on rethinking customer interaction through AI-powered documentation.
Why This Report Matters
Prophet’s research is a wake-up call for business leaders and digital strategists. GenAI is not just a backend automation layer—it’s becoming a daily interface between brands and consumers. By understanding the motivations, fears, and behaviors of AI-powered consumers, companies can craft more resonant experiences, unlock sustainable engagement, and future-proof their market relevance in an age of algorithmic expectations.
For the full report and further resources, visit: https://www.prophet.com
