Adam Torres and Afif Ghannoum discuss ingredient analysis.
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Show Notes:
CPG Radar is providing insights to CPG companies utilizing AI. In this episode, Adam Torres interviews Afif Ghannoum, CEO and Founder of CPG Radar, explore Afif’s journey as an entrepreneur and CPG Radar.
About Afif Ghannoum
Afif Ghannoum has been creating products in the OTC medication and dietary supplement space since 2010. He’s launched products in over 27,000 stores, including Walmart, Target, Walgreens and CVS, and IP he’s licensed to other companies have been sold in over 100,000 stores.
He’s been recognized for his innovations by being awarded several patents across the world, and by winning industry awards for best new products and science & innovation. He’s also appeared in major media outlets ranging from QVC to NPR, as well as industry publications.
Full Unedited Transcript
Hey, I’d like to welcome you to another episode of Mission Matters. My name is Adam Torres, and if you’d like to apply to be a guest in the show, just head on over to missionmatters. com and click on Be Our Guest to Apply. All right, so today I have Afif Ghanoum on the line, and he’s CEO and founder over at CPG Radar.
Afif, welcome to the show. All right, so lots to talk about here today. So I definitely want to get into CPG radar, you know, how you came up with the idea and really what you’re up to and what the business is doing. But I guess just to get us kicked off here. Like, I see the word founder here. Were you always an entrepreneur?
Like, where’d all that start for you? Yeah, so it started my background is as a biotech attorney, and I was working as a young lawyer at a big corporate law firm. And my dad, who’s a scientist, I had this really cool invention and he was excited about it. He was going to have a company built around and some guys that approached him and I was like, oh, that’s great.
I’m kind of slaving away as a lawyer. And a few months later, somehow it came up. I was like, how’s that going? And it turned out the whole thing was based on his invention, his research, and he ended up owning like 1 percent of the company. And I kind of realized he’d been hoodwinked. I thought, here I am, like a corporate lawyer, I’m doing this stuff for other people.
My own dad is getting, you know, ripped off. So that was in the middle of a great recession. And so I said, look, I’d rather take a risk on us. And so we started at first an oral care company, built that up, sold products in about 27, 000 stores, licensed by, you know, global CPG company. And then we got into the probiotic space with a company called Biome.
And so once I transitioned out of that company, one of the things I had noticed was that, Innovation across when I say CPG, I mean, consumer packaged goods, any of these products you increasingly see like science backed you know clinically proven, you’ll see terms like that. But the reality is for a lot of these products, the way ingredients are chosen or clinical trials are designed, things like that.
Is what I call designed by anecdote where someone seen a cool ingredient at a trade show, or they used to work with this guy over here and he’s got this you know, cool clinical trial you know, capability, but it’s not really data driven. So CPG radar. What we’ve done is gather one of the largest, if not the largest curated sets of information around different products, like the ingredients, the claims they make you know, the formats, like, are they a gummy or the capsule, things like that.
And what we do is we feed that data into an AI model. So very quickly, we’re able to ask the AI all sorts of things from, you know, market trends, like what kind of products are using gummies and, you know, heart health to, Hey, is my formulation actually unique? And that sounds like something that should be pretty easy, but when, you know, especially in vitamins and supplements, probably daily new products come on into the market.
So it is really hard manually to keep on top of everything. So that’s what we ended up doing is we use data and AI to really figure out innovation trends of formulation opportunities, things like that to make better products that help all sorts of people. , now you mentioned some you know, previous success , with some other businesses and companies that you’d launched.
When you came upon this idea, how did you know this was the one that you were going to launch? Because as entrepreneurs out there, you know, we get lots of ideas, lots of different ways we can go. , like, how did you know that this was going to be the one you were going to spend some time on? I think the reality is you never know until you ring the register, like, are you actually able to sell something to someone, right?
Yeah. So yeah, my approach. Really is to that wide, but that’s small, right? Take chances, see if something works and listen, you know, once in a while you try something like up. Okay. Didn’t quite go as I expected, but then. You don’t commit so much that if you pivot away from it, it’s not, you know, disastrous.
So I never took the approach of like, this is the idea of betting the family house on it. Entrepreneurship is very difficult. So I think, you know, it’s just like any sort of investment. It’s not necessarily about the upside, like any of these ideas that they hit are huge, but it’s more about protecting their downside.
Yeah, I get that. And and this is a terrible example. And I’ve only been like once in the last, I don’t know, six years, but I was at the horse races last Sunday, a fief. No, that’s a bad one. I bet across the wall. I know it’s a terrible tie in, but I couldn’t help myself. Oh, no, totally true. That’s true. Oh, that’s great.
So go, I want to go further into CPG radar, like, what do you think makes this like, like truly unique from maybe some other, not, not necessarily competition, but what do you think it makes unique in the marketplace in general? What do you think makes it unique? Cool. What I think makes it unique is, you know, now AI is such a buzzword, right?
I’ll talk to companies and they say, Oh, you know, we’re working on our AI strategy. And I think that kind of misses the mark sometimes because that’s like now me saying to you, we want to get into the internet, right? Like that kind of sounds ridiculous, right? But the reality is the internet enables so many things we do every day, video conferencing, email, you know, research, you name it, right?
So AI, I think where we’re emerging. And what I’m really trying to explain is AI is a conduit to what you’re really trying to accomplish. Because at the end of the day, I say this to companies, you don’t care about AI. You care about doing whatever you’re working on more efficiently, more quickly, and much more deeply than you could manually do, right?
That, that’s the power of AI. So what really makes us unique is The data we have, we’ve actually curated ourselves. So we collect data from all over the world on everything from clinical trials being run to products. And when we gather data on a product, we’re literally breaking it down to, like, what are even the, you know, secondary ingredients in on on the package.
Right? So we’re trying to get every little bit of data on every product out there. So that when we’re doing the analysis. It’s really, really granular. The other thing kind of sets us aside is I think there’s a little bit of a misnomer that AI is a little bit set it and forget it, right? Oh, I just asked and it’ll give me what I need.
The problem with that is twofold. One is still even like, what we have is called a closed garden model where we only train on our data. But even then. A. I. Is not perfect, right? Like, contextually, sometimes it won’t get things right. So one of my favorite examples of that is we were working on a project for an ingredient company, and one of the things we’re able to do is quickly show a company that they’re trying to get their ingredients into.
Here’s exactly which ingredient can optimize the product. So that’s This company’s product. And here’s how, here’s the new claims they’ll get. Here’s suggested marketing language. Here’s the ingredients to use, right? Like this can save them sometimes months, but definitely weeks of the time and effort. But AI sometimes will suggest wonky things, right?
So like for example, it suggested, Hey, this company, you could create a 50 plus women’s fertility product. Well, that’s the majority of 50 plus women. I know continue to be fertile is not high on their agenda, right? So that’s something where. How we address that is we actually have a team of PhDs that look at every single output that comes out to confirm it actually is accurate.
And it makes sense. So I think that human layer is going to continue to be really important. So, really differentiators is, you know, proprietary data set that we’ve curated, but also this human layer of scientists that are making sure what our outputs coming out of AI are accurate and, you know, contextually, right.
So whenever I know somebody’s and even before AI, so just when you’re getting into old, old fashioned research, whenever you start, you know, digging through a ton of data, I feel like just surprises or whether it’s trends or otherwise, like tend to come up. And so the, now that you’ve been, you know, training your own models and doing your own research anything surprise you and like trends or otherwise that you found just on this journey, anything surprising?
What’s most surprising to me is the amount of deep science that actually goes into these products. And what I mean by that is we do these things where we will look at the clinical trial landscape for specific ingredient and we’ll just look, what are people studying? Right? Because why that’s great to do is you’ll see 2, 3 years from now.
You’ll see like unique combinations of ingredients. You’ll see commodity ingredients, things like coffee that all of a sudden, wow, these guys are running clinical trials for, you know, all sorts of health conditions, right. Supplement, right. So it allows us to really be able to have, you know, a futurist look at what is probably coming down the pipeline you know, in products and ingredients.
The other thing is, it’s funny, right. You’ll see trends and then you’ll see counter trends, right? So Melatonin was a huge one. Obviously, every everyone and their mother started. Oh, my God. I forgot who the comedian was. You can do the Melatonin. That was funny. It’s like, yes, I’ve tried it. I still can’t sleep.
Okay. Go ahead. Right. Right. So what we noticed when we looked at the types of marketing claims. Sleep companies are making now with sleep products. A lot of them are specifically saying non naltonic. You know what I mean? Like they kind of been a backlash against melatonin. So people are calling out the other thing.
That’s just continuously Getting more and more coverage are clean ingredient call outs like it used to be, you know, when I ran an oral care company You would get, I would say like a fringe part of your audience that really didn’t like that there was a paraben in the formula and parabens are really good at killing pathogenic organisms.
So like, you know, bacteria that will, you know, could make you sick, right? So you put it in a mouthwash, so it keeps you safe. Well, there was, you know, this is 2010 ish. You would have a few people that say, well, I’m not going to buy it because there’s parabens. But the science was strong, safe ingredient. Now.
I’d say it’s almost the majority of of people are really particular about what is in the product They really want to know so i’m more sophisticated the consumer Yeah, well and they may be more sophisticated but they’re being told this is important now The problem with that is sometimes it’s over the top, right?
When you’re selling a product, you know perception is reality a lot of times So it’s like you know, i’m a diet coke fiend You The way people talk about, you know, the sweeteners and Diet Coke, like I should have dropped dead of cancer many months ago, right? But you know, It’s not funny.
It’s nothing to laugh at, but you made me laugh. It’s good. Go ahead. But like, the perception is that, you know, the sweeteners and diet sodas are not good for you. Right. So what you’ve seen is the emergence of products that are like, better for you. So does like, you know, the Ollie pops of the world that are just on fire because consumers have a real need.
Like, take that brand that brand prebiotic soda, you know, 5 or 6 years ago when brands like that were launching. I think people thought this is very fringe. Like, how many people are going to pay 3 plus a can for, you know, it’s not even calorie free. That brand is going to do half a billion this year in sales, right?
And their pitch is essentially better for you soda, right? So there are these trends that now where they were even maybe the secondary claims that you’d see on a package like gluten free, soy free, you know organic. Now they’re almost being elevated, you know, further up, up the packaging. That, that’s almost the main selling point.
You know what, now that you say that, I’ve noticed that. Now that you say that when I’m looking at a bunch of different things, so it’s almost like as their marketing team is doing their analysis and seeing why people are buying it, moving up the chain. It’s interesting. 100%. So one of the things we’re able to do is, you know it came up today, there was a product that a company is launching and they’re like, well, should we pick this term or that term?
We were able in literally five minutes to look at 500 products in that category and say, 49 percent of brands are using this term, you know, X percent of this brand are using that term. Like. And then we can ask AI, like, what would be the opportunity for differentiation on these claims? Right? So that analysis usually for, you know, an innovation team to do or a marketing team.
And you said that was in 5 minutes. What would that have taken before? Like, what would that have taken weeks? The problem is. You know, how do you organize data? Yeah, well, and then biases, maybe some biases or something’s missed. Like, yeah, so it’s a complex. Well, there’s a couple of things going on.
1, if I tell a project manager, go find all the brands making similar claims, the reality is most people. They have , maybe 10 or 20 competitors in their mind that they want to go check. So that’s bias. Number one. The second is how, what, what do they use to organize it? An Excel spreadsheet. So I can’t tell you how many times we talked to a company that’s just drowning in tabs and tabs of data.
And they’re like, I don’t know where, where was that claim over? Whereas we’re able to take all that data, ingest it, And spit out and tell you, Hey, here are the gaps. Here are the white spaces. Now, taking it even further, we do a lot of things like ingredient heat mapping. So we can literally tell a company, like, here are the 5 ingredients you have in your formula, and I’ll give you a cool example of even past that.
But we can say those 5 ingredients, we show them a gigantic heat map and show them in market, but. Here are all the other products that have some of those ingredients, none of those ingredients, you know, and you can very quickly see, is it actually a unique formula or do we need to go back to the drawing board?
Where it gets really cool is a lot of times what we’re seeing now is a company will come to us and say, Hey, can you help us figure out? Is our formula unique? And we’ll come back and go, actually, it’s too unique. You have a couple of ingredients here that if you strip out, you’re not losing any of these claims.
But, , one company doing a global launch, we were able to cut out over a million dollars and cost of goods sold because they didn’t need at least one of the ingredients, you know, so that’s kind of the power of not just data, but synthesis of that data, it’s that twofold.
It’s not just about AI. It’s not about the data. You know, how do you marry them and get an output that’s actually actionable, you know, what type of companies obviously CPG, but what type of companies in terms of size or otherwise, like, where should they be at before they maybe are good fit to get the most value out of working with CPG radar?
Like, is it a size? Is it a volume of sales? Is it? Where are they at? So what’s funny is when we were launching, going back to your original question, like, how do you notice the idea to go? We didn’t know if this was going to really appeal to like startup companies that were trying to get their first formulas going or, you know, the more sophisticated guys.
So what we found is 90 percent of our customers are massive companies and they have huge internal innovation teams. What they don’t have is more time. Right. Because it’s just one project after another is, you know, going over to the innovation team or the R and D team or the product development team.
And it’s just, you know, that plate is only so big. So what we’re able to do is step in and, you know, really extend that bandwidth. I’ll give you a simple example. One of the things that’s increasingly important is making sure that the science behind these products is really sound. Right. But what that entails, then, is pulling up the studies, making sure you have all the studies, and then interpreting, like, what the hell is this thing saying?
Right? So, one of the things we do is we instantaneously take a study, we summarize it into, here are the claims the study’s about, and by the way, here’s a summary of the quality of the study design. Because, you know, sometimes you’ll get these studies that sound great. And then you realize, well, it was done on 10 people.
It’s not really that robust of a study. Right? So that process, just that process we do work for companies where all we do is, summarize and point out, you know, the opportunities for, more rigorous science based on what the studies are saying.
And so for the startup that’s out there, let’s, let’s talk just a little bit about that for a moment. Like, how do, how do these type of insights how can they help them or how they used it in the past? You told me the large enterprise, but what about for the startups? How have they used it?
Yeah, so startups use it in many of the same ways that investors actually use it, right? Because that’s another niche of the market that we weren’t really looking for, but kind of emerged and what Interesting. When you say investors, are you talking about, like, VCs? Are you talking about, like, that side?
Yeah, venture capitalists, private equity firms. Like, yeah, strategic buyers, right? So once you, I wasn’t thinking in that direction either, but then once you just said it, it was a light bulb went off. Like, of course, they’d want to access.
Most of these guys, even if they have an expertise in a category, these are massive categories. Like there aren’t thousands of products, there are thousands of companies, right? So their challenge is, wow, this is a really cool company. Their sales are really growing. But the real challenge is, do they actually have a defensible moat around what they’re doing, or are there 10 other guys coming, you know, that are doing clinicals right now in the massive companies that are going to wipe these guys out in two years?
Right. It’s very hard for them to get a real sense of how unique it is. And then the other critical thing, especially for the more sophisticated investors and financial buyers, is how rigorous is the substantiation behind what they’re saying? Because You know, the road is littered with companies that, you know, built sometimes to hundreds of millions in sales.
And then, you know, the regulators or class action lawsuits destroyed it because the reality is they were saying things they could not substantiate with the science. So for investors, being able to, like, efficiently understand. Is this actually differentiated? And also how rigorous is the underpinning of the science?
That’s very valuable to them. The other thing is sourcing, right? Like, what company should we even be aware of that are doing unique, right? So that’s kind of the investor use case on the startup side. You know, where we get the most exposure to startup is more in a venture studio setting where they’re trying to, you know, rinse and repeat and build many brands and many and many products.
And so, in that scenario. They’re trying to understand, like, they have a thesis, they think, you know, either around an ingredient or they want to go into a specific category. How can we stand out in the market? Should we even go into this market? You know, things like that, or they have a prototype formula.
And again, just like, you know, any company of any size, like, I’ve differentiated is our formula. We’re thinking about these claims. Are we going to actually stand out? You know, things like that. Yeah, that that makes total sense for venture studio too. Because once they figure it out, or once they have that, they can take that learning and apply it to more and more things that they want to do.
And then the trends just become more more significant for them to think about their whole portfolio of what they’re trying to do. If they’re going to go deeper in a particular niche, if that niche is not where they need to be, like, yeah, they can make a lot of,
Decisions from the macro level and get micro. So that’s, interesting. Yeah, well, honestly, it’s really fun because like data data can go a million ways and it’s kind of, , your imagination Fantastic. Well, a few man This has been a lot of fun getting to know more about what you’re doing over at cpg radar If somebody’s listening to this or watching this and they want to follow up and learn more and follow the company I mean or or kanaka, how do they do that?
Yeah, so the best is either just our website CPG radar dot com, or I post a lot on LinkedIn, like, using all use cases scenarios. So, on LinkedIn and my name is easy to remember joking a fief and last name. G. H. A. And then OUM, just, you know, connect with me on LinkedIn. That’s awesome. And for everybody listening, just so you know, we’ll put the links in the show notes so you can just click on the link and head right on over.
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So again, hit that subscribe or follow button and again, thank you so much for coming on. No problem. As my son says with his 12 followers on YouTube, smash the subscribe button. Ha ha ha. Fantastic. Thank you.