Checking in with… Walter Pasquarelli

1. You’ve been working in AI for over a decade, long before it became the cultural phenomenon it is today. What first drew you to the field?
I actually come from a background in politics and economics—fields that might seem, at first glance, far removed from AI. But in reality, they’re deeply connected. We often frame AI as a technical phenomenon, but its impact is profoundly human. It’s about the systems we build, the values we encode, and the choices we make today that will shape how people live, work, and relate to each other tomorrow. I was drawn to AI not just for what it can do, but for what it reveals about us.

2. What is “Synthetic Reality,” and why should luxury brands care?

Synthetic Reality refers to a world where the lines between real and artificial content blur beyond recognition. I first started researching this idea in 2018, when the first viral deepfakes appeared. For luxury brands, this is critical because authenticity—once tied to provenance—is now being redefined by emotional resonance. As AI influencers, videos, and voices become indistinguishable from those that are real, the brands that win will be those that create experiences so compelling, they feel authentic, regardless of their origin, while mitigating any adverse risks.

3. Has the definition of authenticity changed in the age of AI?
Authenticity has long been associated with provenance—the physical trace of origin, the maker’s touch, the verified source. But in a world shaped by synthetic media, that notion is shifting. What feels real is no longer defined by its origin, but by its emotional resonance. In today’s reality, even a synthetic object or virtual persona can carry profound meaning if it becomes part of someone’s memory, story, or sense of self.

This isn’t about deception. It’s about how meaning forms. Synthetic experiences—from virtual companions to AI-generated narratives—can provoke genuine emotional responses. What we’re witnessing is a redefinition of authenticity: one rooted less in what’s materially true, but in what feels personally real.

4. What does emotional connection look like in a world of AI-generated content?
As generative technologies evolve, emotional connection is becoming less about the nature of the source, and more about the quality of interaction. People aren’t just consuming content anymore—they’re forming relationships with voices, characters, and systems that adapt to them, reflect them, and remember them.

This is the paradox of synthetic reality: the more artificial something is, the more intimately tailored it can become. And that tailoring makes space for connection—because intimacy, at its core, is less about who or what we interact with, and more about how it makes us feel.

5. What are the key forces shaping Synthetic Reality?
– Hyperrealism: AI-generated content is now lifelike enough to fool even experts
– Volume: Soon, 90% of online content will be AI-generated.
– Personalisation: AI chatbots and tools learn preferences, creating entirely bespoke experiences
– Interactivity: AI avatars now engage with users in real time, creating two way relationships
– Immersion: Whether or not something is “real” becomes irrelevant because it’s the emotional response that counts

6. How can luxury brands navigate this new era without diluting their values?
It’s about blending heritage with innovation. Human made craftsmanship will always be the gold standard. I compare it to Italian leather – timeless and irreplaceable. But that doesn’t mean AI has no place in luxury. Quite the opposite. AI can enhance storytelling, deepen customer engagement, and tailor experiences in ways we’ve never seen before. The key is taste, clarity, and distribution. It’s not about replacing the human touch, but rather using AI as a co-creator to elevate it.

7. What ethical concerns are emerging in this space?
Deepfakes, disinformation, emotional manipulation… I think of the teenager who developed a chatbot relationship that spiralled into something tragically fatal. Or the company that lost $25 million after falling for a deepfake of their CFO and finance board. These are real world consequences. For luxury brands, the opportunity with AI is immense, but so is the responsibility. Transparency and ethical boundaries aren’t just nice to have– they’re essential.

8. What guiding principles should luxury leaders take forward from this conversation?

a) In the context of synthetic reality, authenticity no longer depends on origin—it depends on experience. The source of a moment, product, or interaction matters less than how it’s felt and remembered. As generative systems become more capable of simulating emotion, presence, and personality, the distinction between the “real” and the “replica” begins to dissolve.

b) What remains constant is connection. Emotional resonance becomes the metric of value. Brands and institutions that once competed on craft or scarcity are now challenged to compete on meaning—on their ability to evoke, engage, and endure in people’s lives.

c) In a world where everything can be copied, what matters most is what cannot be replaced: the feeling we carry from an interaction. That’s the new frontier of authenticity.

9. Are there any destinations still on your bucket list?
Absolutely—Japan, South Korea, and Argentina are still high on my list. I’m drawn to places where tradition and innovation coexist, and all three offer completely distinct versions of that dynamic.

10. Dead or alive, who would your ideal travel companion be?
My friend group from back home. We’re spread out across different countries now, so travel has become our way of meeting up—part reunion, part adventure. There’s something special about discovering new places with people who’ve known you forever.

Walter Pasquarelli is an internationally recognised expert on AI strategy and synthetic reality. Leading thought leadership and advisory programmes at The Economist Group, Walter operated at the forefront of technological innovation, shaping policy and business perception of emerging technologies. He is a member of the OECD’s AI expert network and a research affiliate at the Bennett Institute at the University of Cambridge. Recognised as one of the top 16 global speakers on AI, Walter’s work empowers C-suite executives and aspiring global leaders with a forward-thinking perspective geared towards success in the age of artificial intelligence. His work has gained global recognition, with features in The Economist, Forbes, Der Tagesspiegel, El Tiempo, the European Parliament, and NATO.

Image sources: Instagram, Luxuo, Phillipe Matta

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