More than 50 million U.S. adults are now using smart speakers and double that number are using voice assistants on smartphones. Smart speakers represent the fastest growing technology adoption cycle in history--even faster than smartphone uptake by consumers. This poses a nagging question for brands and agencies: “How should I incorporate voice into my marketing mix?”
Smart speakers are showing up everywhere. Voice usage on smartphones is rising. Voice assistants have become an important digital channel with substantial reach seemingly overnight. This has brands thinking about how to best establish a presence in voice, how the new channel will impact their omnichannel strategies and what approach their voice app strategy should take. Voice apps are the skills or actions that brands can build to engage directly with consumers through Amazon Alexa and Google Assistant.
Amazon’s Alexa is being adopted by car makers ranging from Ford and Toyota to BMW. Ford says 20 million cars will have Alexa access in 2018 and that is a good start. Those announcements show a trend, but new testing by Amazon may accelerate Alexa availability by introducing an Echo Dot model for cars.
NPR revealed in an interview with MediaPost that its streaming listening through Amazon Alexa devices grew 242% between November and February. Alexa now accounts for 13.3% of all NPR’s live streaming, up from just 3.9% in late 2017. When listening on any device triples over a 3-4 month period, every general manager and program director is going to take note.
“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," commented Sebastien Szczepaniak, a former Amazon executive who now heads e-commerce for Nestlé SA. He has particular insights into the challenges given his background with the world’s largest online marketplace that also is the global market share leader in the voice assistant segment.
There is a new report by OC&C that reveals voice commerce reached nearly $2 billion in the U.S. in 2017. More surprising to some is that it is projected to reach $40 billion in the next five years. That is an 86% compound annual growth rate (CAGR). And, it's not just a U.S. phenomenon. In the U.K. voice shopping is expected to climb from just $200 million to $5 billion in that same period.
Voice assistants are destined to become a big part of consumers’ lives and represent both a big opportunity and a threat for brands. Why? Purchases that occur today through physical stores, websites and apps will materially shift to voice commerce over the next three years. Brands can take advantage of these changing consumer preferences or cede a rapidly growing sales channel entirely to their competitors.