Why “AI-powered” stopped being a magnet in 2026 and started working like a coupon.
1. The label now costs you money. Researchers at Washington State and Temple put the same products in front of 1,000 people and changed exactly one thing: whether the description said “artificial intelligence.” Across eight product and service categories, purchase intent fell every single time. It fell hardest where the stakes were highest, a shrug for a television, a wince for a car or a medical diagnostic. Parks Associates asked roughly 4,000 Americans a similar question: 18% said AI made them more likely to buy, 24% said less likely, and 58% said it changed nothing. You are spending the best three seconds of your homepage on a word that repels more people than it attracts and bores the majority.
2. We have seen this movie. It came out in 1998. Cooper, Dimitrov and Rau published the autopsy in the Journal of Finance: companies that simply bolted “dot.com” onto their names earned about 74% abnormal returns in the ten days after the announcement. No new product. No new customers. A new suffix. Books-A-Million announced a redesigned website the day before Thanksgiving 1998 and watched its stock run from $3.06 to an intraday high of $47. Two weeks later it was $10. By 2000 it was back around $3.60. Same bookstore the entire time.
3. The real tell is the deletion trade. Here is the part everyone forgets. When the bubble burst, the same researchers tracked firms that stripped “dot.com” back out of their names and found cumulative abnormal returns of roughly 64% over the sixty days around the announcement. The word paid 74% going on and 64% coming off. A label that is valuable in both directions is not an asset. It is a costume, and eventually the audience notices the zipper.
4. The prefix is now a legal exposure, not a marketing one. The SEC has a name for it, “AI washing,” and a growing docket. Enforcement opened in March 2024 against two advisory firms and reached its first public company in early 2025: Presto Automation, whose drive-thru voice AI turned out to belong to a third party and to lean heavily on humans. The founder of Nate Inc. was charged over more than $42 million raised on claims of an AI shopping app. Six named cases since March 2024, over $44 million in alleged fraud, and securities class actions over AI claims roughly doubled from 2023 to 2024. “Everybody says it” has never been a legal defense.
5. The buyer already assumes it, and has already been burned. In 2019 MMC Ventures reviewed 2,830 European “AI startups” and found no material evidence of AI in about 40% of them, even as the AI label pulled 15% to 50% more funding than plain software. That arbitrage is closed. MIT’s 2025 enterprise study weighed $30 to $40 billion in spending against a blunt finding: 95% of generative AI pilots produced no measurable impact on profit and loss. Your prospect has a dead pilot in a drawer. “AI-powered” no longer excites her. It starts an interrogation.
6. So name the job you finish. “AI-powered claims processing” describes your plumbing. “We close claims in four hours instead of nine days, and you pay only for closed claims” describes her Tuesday. Run the ninety-second audit: delete every instance of “AI” from your homepage. If what remains still names a verb, a number and a deadline, you had positioning. If the page goes blank, you had a costume.
The bottom line. Nobody bought a book in 2004 because the store was “internet-enabled.” They bought it because it showed up in two days. The prefix was never the product, and in 2026 it is not even the hook. Tell me what you finish, how fast, and what it costs. I will assume the robots.