I remember in the years before the pandemic that I would joke that all you had to do was "sprinkle in some blockchain" to your VC pitch and your valuation would automatically go up by tens of millions. It seemed dumb to me then and it seems dumb to me now.
The people who are being marketed to with the AI term don't have any idea what that mean and AI, as a marketing term (the only way it's ever been, so far, commercially used) means a lot more than transformers. My dishwasher has "AI" because it has sensors that can detect where the most dishes are.
The marketing term really just means that the product changes it's behavior without user input. A simple "if...then" is AI.
AI has been used as a marketing term for at least a decade now but LLMs are poisoning the brand because they're, largely, implemented in almost exclusively user hostile ways.
To clarify, I'm mainly talking about B2B-type businesses where the marketing is to investors or other large enterprises. Despite the fact that it's popular and in vogue to think of VCs and business leaders as idiots, most of them actually do understand what AI is and the difference between "modern" AI and basic automation.
And even if you're talking about end consumers, I feel like there is a growing backlash against AI and people will think of a business that touts their "AI dishwasher" or whatever as obvious bullshit and see it as a net negative.
Slightly ironically, now in the mirrorless era, and AF algorithms actually based on DL subject recognition and complex predictive algorithms, Canon has retired the "AI" label.