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HOW VOICE ASSISTANTS COULD CHANGE THE WAY WE SHOP

by Kane Simms

AI is disrupting every industry, leading to new business models, further digital transformation, and a future of technology that’s more integrated into our natural environment. Smart speakers are the fastest-growing consumer technology since the smartphone, and they are poised to revolutionize the way we interact with technology. Computers can finally speak our language.

A key question for business leaders to consider right now is: How will the voice assistant movement affect the way your customers shop—and how will you, in turn, need to adapt in terms of how to market and sell your products and services?

Strategy consultants OC&C predict that voice shopping will grow to $40 billion–plus in 2022, up from about $2 billion as of this writing, across the United States and the United Kingdom.1 Some predict even faster growth: Juniper anticipates that number to be $80 billion by 2023.2

While early numbers sound promising, you should take them with a grain of salt. Amazon hasn’t shared any hard voice shopping numbers, yet reports from The Information in 2019 found that only 2% of Amazon Echo owners have ever tried voice shopping.

It all really depends on how you define shopping. In 2018, Voicebot found that one in five U.S. adults had used voice as part of their shopping journey, which could be any point on the path to purchase, not just the transaction itself.3 In the following year, Voicebot also found that more than 40% of smart speaker users in the United States have searched for a product on a smart speaker.4

The general consensus is that voice shopping activities are increasing, but what makes voice shopping itself appealing?

There are a few fundamental reasons why voice shopping has huge potential. If we can understand these reasons, we can shape a strategy that matches or exceeds customer expectations, as more and more consumers use voice assistants to buy goods and services:

It’s faster. We can speak faster than we can type, so using voice is typically quicker than any other modality. For example, in 2018, Virgin Trains in the UK launched an Alexa skill that lets customers book train tickets through Alexa. It takes the average booking time down from seven minutes online to two minutes via voice. The potential to save time is always appealing to customers.

It’s frictionless. No matter how user friendly you make your website or app, no matter how much you work on your conversion rate, you’re always battling the inherent friction that’s built into the device itself. Consider that in order to get to your fantastically optimized app, a user has to:

  1. Pull out their phone
  2. Unlock it
  3. Swipe to find your app
  4. Tap to open it
  5. Wait for it to load

Only then can they begin that delightful experience you’ve prepared for them. With voice, everything is just an utterance away. There are simply fewer barriers to overcome in order to start the shopping experience.

It can convert leads to sales. It’s not just access and speed that are driving the growth of voice shopping. Above all else, voice converts leads into actual sales. Consider the example of Invoked Apps’ suite of Alexa skills, which allow users to play ambient sounds, such as white noise, city soundscapes, thunderstorms, and much more. They’re some of the most popular Alexa skills in the Skills Store, attracting more than 150,000 users per day.5 Founder Nick Schwab told me that when Amazon released in-skill purchases (ISPs) for Alexa in 2018, giving developers the ability to sell digital goods through their Alexa skills, Schwab rolled out ISPs in his own skills. This gave users the ability to pay for premium features—namely, to play two different ambient sounds at the same time, such as a city soundscape with an open fire.

When asked about the conversion rate of users upgrading to paid sounds, Schwab said, “Overall I’m seeing around a 3% conversion for users … And then the conversion rate from trial to paid is more like 90%, which is staggering.”

And voice doesn’t just help drive sales of digital goods, such as one-off extra lives in games and subscriptions to premium content; it can lead to increased physical sales, such as train tickets and groceries, and it’s even being used in-store to sell products.

The second example of how voice is increasing conversions comes from The Mars Agency. It’s trialing an in-store voice assistant called SmartAisle with retailer BevMo!, which helps customers decide which whisky to buy. Here’s how it works: An Amazon Echo is installed on an illuminated shelving unit in the whisky aisle in-store. Customers stand in front of the Echo and talk out loud to the SmartAisle skill. In turn, the Echo responds with information about certain types of whisky and guides the customer through a decision-making process. The shelving unit has lights under each bottle, and as the conversation progresses and the assistant begins whittling down the selection, the lights under the ruled-out whiskies dim. At the end of the experience, the customer is left with one whisky bottle illuminated on the shelf. Bree Glaeser, Director of Innovation at The Mars Agency, told me: “People don’t always want to go with the opinion of the store clerk.”

SmartAisle not only engages customers in-store, but above all else, it actually converts browsers to buyers. Brooke Hawkins, Senior Voice User Interface Designer at The Mars Agency, said: “We’re definitely consistently seeing sales lift in the stores that SmartAisle is deployed in.”

The Shopping Mall of the Future

The rise of smart speakers with screens could open the door for voice shopping to actually become what it’s forecast to be. Devices like the Echo Show and Google Home Nest Hub are the beginning of the multimodal voice experience, where you can see a screen and control it with your voice. Extend this to the Fire TV Stick with Alexa onboard, and the TV could easily become the shopping mall of the future.

Voice is also being extended into the web by companies like Voysis. Rather than wasting time with filtering and searching on a retailer’s website, customers using Voysis can just ask for “a pair of red men’s Nike trainers under $100 in a size 9,” and Voysis will do the filtering for you.

Then there’s the emerging use case of the car. Being able to shop for groceries or order takeout from the car creates a completely new environment where people will be able to shop. With almost all major car manufacturers, including Mercedes, BMW, Tesla, and Ford, shipping new motors with in-car voice assistants, and devices like the Alexa Auto equipping older vehicles with a voice assistant, you’ll soon be able to order those flowers you forgot for Mother’s Day, place a bet on the big game, or impulsively purchase an audiobook to listen to on your way home, all from within your vehicle and all without taking your eyes off the road.

Whether or not you believe the hype of the forecasted numbers, there is simply too much traction and potential with voice shopping for it not to be something that can seriously impact your business. With that said, it doesn’t come without its own challenges.

First, there are challenges for retailers, including:

  • Data ownership. If you choose to use one of the top two platforms, Alexa or Google Assistant, then they’ll ultimately have visibility into all of your skill or action activity, including what your users are asking for and buying. That’s pretty compelling competitive intelligence.
  • Commission. For a truly seamless experience, you’ll need to use a native payment service, like Amazon Pay or Google Pay. For that, there’s a charge.
  • Competition. Amazon’s aim is to be the place where you can buy anything online. That means that whether or not you compete with Amazon today, you might tomorrow. As Joshua Montgomery, CEO of Mycroft told me, “If you’re in business, you’re probably going to compete with Amazon someday.” With that said, how Amazon treats competing products on Alexa is yet to be seen.

Second, there are challenges for consumers, including:

  • Difficulty browsing. Although we can speak faster than we can type, it’s quicker to scan a list of search results than it is to listen to those results read back. This means that general browsing, a common product research behavior, is a challenge on voice.
  • Difficulty discovering possibilities. Discovering voice applications is a challenge. So finding out what shopping facilities exist on voice and understanding how to access them can be a challenge for some.
  • Cognitive load. There’s also a cognitive load placed on the user in order to access a third-party experience. For example, having to say, “Alexa, ask [brand] to [do something],” relies on the user knowing (a) that the brand exists on the platform and (b) that the brand provides the option for you to do that something.

So, how should companies be preparing for voice shopping? When preparing a voice strategy, the first thing to understand is that voice is more than the two big platforms, Alexa and Google Assistant. Voice is an interface to technology. Your ultimate goal, then, should be for a voice interface to overlay all of your customer touch points, from smart speakers and voice assistants to your website, apps, phone lines, and even in-store experiences. For this, you’ll need to develop your skills and understanding of voice user interface (VUI) design practices so that you can match a user’s context and needs with your solution.

As with a website or app, a great front end is rarely useful unless it’s connected to a smart back end, and this is where voice excels. As part of your voice strategy, the front end should be integrated with your current line of business systems to take advantage of the intelligence you already have. This will enable you to surface products, pricing, stock levels, and previous purchases and give you a basis for processing transactions and answering product-related questions.

By integrating voice with your business systems, voice becomes something that can push your business forward, rather than becoming just a shiny new gimmick. And once you’ve established the basics of product ordering and research, you’ll then be in a position to dig deeper into things like personalization, recommendations, and using the data you’ve gathered to improve or even create new product lines or content based on what your customers are actively asking you for.

Making voice an integral part of your business won’t happen overnight, but businesses that put the wheels in motion now can be out in front in a year’s time. But first, you need to get off the starting blocks.

TAKEAWAYS

Smart speakers are the fastest-growing consumer technology since the smartphone. Voice assistants will transform the way customers shop—assess how to market and sell your products and services accordingly.

  • Voice shopping has huge potential because it’s faster (we can speak faster than we type), there’s low friction to start a shopping experience (no need to unlock your phone and dig through apps before getting to your site), and it can convert leads to sales at a high rate.
  • Businesses should look to develop a voice interface to overlay all customer touch points. To begin, integrate your voice strategy with your current line of business systems, and build a basis for surfacing products, processing transactions, and answering product-related questions.
  • Once you’ve established the basics, you’ll be in a position to dig deeper into personalization, recommendations, and using the data you’ve gathered to improve or even create new product lines or content.

NOTES

  1. 1. Sara Perez, “Voice Shopping Estimated to Hit $40+ Billion Across US and UK by 2022,” TechCrunch.com, March 2, 2018, https://techcrunch.com/2018/03/02/voice-shopping-estimated-to-hit-40-billion-across-u-s-and-u-k-by-2022/.

  2. 2. Bret Kinsella, “Juniper Forecasts $80 Billion in Voice Commerce in 2023, or $10 Per Assistant,” voicebot.ai, February 19, 2019, https://voicebot.ai/2019/02/19/juniper-forecasts-80-billion-in-voice-commerce-in-2023-or-10-per-assistant/.

  3. 3. Bret Kinsella and Ava Mutchler, “Voice Shopping Consumer Adoption Report, 2018,” voicebot.ai, https://voicebot.ai/voice-shopping-report-2018/.

  4. 4. Bret Kinsella and Ava Mutchler, “U.S. Smart Speaker Consumer Adoption Report, 2019,” voicebot.ai, https://voicebot.ai/smart-speaker-consumer-adoption-report-2019/.

  5. 5. “Adoption, Growth, In-Skill Purchases, and Developer Rewards with Nick Schwab,” VUX World podcast, August 18, 2018, https://podcasts.apple.com/gb/podcast/adoption-growth-in-skill-purchases-developer-rewards/id1347820660?i=1000417400729.

Adapted from “How Voice Assistants Could Change the Way We Shop,” on hbr.org, May 15, 2019 (product #H04YEN).

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