The evolution of voice recognition technology will play a major role in consumer shopping habits over the next three to five years, experts say.
Voice-powered devices have been on the rise since Apple’s Siri debuted in 2011 with the iPhone 4S. Now Amazon’s Alexa, Echo and Google Home are the household names gearing up for a knockdown, drag-out voice-and-smart-speaker war with billions of dollars at stake.
Voice shopping spending is expected to skyrocket 1900%, from $2 billion today to $40 billion in 2022, according to recent data from OC&C Strategy Consultants, an international firm specializing in corporate and business strategy.
Voice shopping: The next big consumer trend
The findings indicate that Amazon’s Echo, Google’s Home and Microsoft’s Cortana have the largest market penetrations right now at 10%, 4% and 2% respectively — so the battle for voice shopping domination is far from over. That’s because the way consumers interact with products is changing rapidly. In other words, when it comes to shopping, more people are abandoning the keyboard and grabbing the bullhorn.
According to a new report from consulting firm Capgemini, shoppers will spend 18% of their total shopping budgets via voice assistants three years from now, up from 3% currently. And 40% of consumers will shop via voice assistant.
“Of all the disruptions that are taking place in all the things technology is bringing into our space, voice is among the most disruptive,” Graeme Pitkethly, chief financial officer of Unilever PLC, told the Wall Street Journal. “In digital investment this is our biggest focus.”
To that end, Google recently announced that it was tweaking its Assistant algorithm to a new format for “featured snippets” which will try to answer predicted queries based on multiple ways to phrase it.
“Sometimes the words we use to ask a question are broad and there could be several different interpretations of the question,” Emily Moxley, search product manager, said in a blog post. “With multifaceted featured snippets, we’re able to better understand your query and recognize when there could be multiple interpretations of that query.”
2 things consumers can expect soon from voice shopping
Look for product selection to become dominated by big brands
Sebastien Szczepaniak, a former Amazon executive who now heads e-commerce for Nestlé, told the Journal that the search hierarchy in voice shopping will be the difference between profitability and irrelevance. Unlike the grocery aisles where the big brands pay to be eye-level, with voice the playing field is more level, haphazard even, currently.
“When it comes to voice search you go first position or you go home because beyond the first or second place there is no future,” Szczepaniak said. Look for the major brands to adapt to this in a big way.
Amazon has an early lead, but competition is coming
Because of the success of its 2017 holiday season sale on the Echo and Alexa, Amazon flooded the market, giving itself a significant lead in voice shopping. But Google is ramping up its infrastructure to counter Amazon by partnering with big retailers.
Target and Walmart are just two websites that can be voice-shopped via Google Home, but there are many more in the works. Ebay has also joined the fold, according to CNBC, leaving Amazon to align itself with smaller, private-label brands, the finance news website reports.
As consumers continue to adapt to technology to fill their most basic needs, one thing is certain: Voice shopping, part of the larger world of “conversational commerce,” is here to stay.