Voice shopping has emerged as another potential commerce channel as smart speakers and voice-enabled assistants become increasingly common in consumers’ homes. Yet widespread device adoption has not necessarily translated into widespread purchasing, with sharply conflicting estimates of how often consumers actually use voice assistants to complete transactions.
Beyond traditional retail purchases, voice commerce is also expanding into areas such as charitable and political donations. As voice-enabled devices gain new transactional capabilities, businesses and other organizations have an opportunity to explore whether the convenience of conversational commerce can turn everyday voice interactions into a meaningful payment channel.
Voice shopping—the ability to make purchases through an IoT device or voice enabled assistant—is yet another way for consumers to shop for items.
According to Consumer Intelligence Research Partners (CIRP), the installed base of Alexa devices is 76 Million units. Reported internal Amazon data alleges that there is a 50 million base while other surveys put that number all the way up to 100 million.
While the amount of devices sold is sizable, the more interesting question is how many users actually use them to make voice purchases? According to “The Reality Behind Voice Shopping Hype,” an article published by the Information, the number is small:
“That only a small fraction of smart speaker owners use them to shop, and the few who do try it don’t bother again. The Information has learned that only about 2% of the people with devices that use Amazon’s Alexa intelligent assistant—mostly Amazon’s own Echo line of speakers—have made a purchase with their voices so far in 2018,”
This internal data is in stark contrast to what other analyst firms such as Voicebot have predicted:
“The U.S. Smart Speaker Consumer Adoption Report for 2018 revealed that 15% of U.S. smart speaker owners say they were making purchases by voice on a monthly basis” and “3.9% of U.S smart speaker owners say they make a purchase by voice on a daily basis at the end of 2018”
As such, it is difficult to come up with an exact estimate of the revenue from Alexa-based voice-activated orders. Depending on which data is used, estimates range all the way from just 50 million to 12 billion dollars in 2018.
Either way, voice enabled devices are a channel for purchases. According to an article published in digital media solutions titled “Alexa Voice-Enabled Fundraising is Now Available For Political Donations” the devices are being used for donations:
“On September 19th, Alexa allowed political candidates for the 2020 presidential election to sign up for Alexa’s voice-enabled donations. According to the Amazon blog, “Starting [in October], customers will be able to simply say, “Alexa, donate to [candidate name]” to contribute up to $200 to any participating candidate’s campaign fundraising efforts.
Across the massive base of Alexa devices in the United States and the purchase volume statistics, this new feature brings an interesting approach to building a donor base. The article continues to mention that:
“a recent State of the Campaign survey from political consulting firm Campaigns & Elections found that “40% of political professionals said they think voice search will be either very important or somewhat important for the future of campaigns.”
With voice activated devices becoming more prevalent in U.S. households, their ability to spread information and receive donations is another tool for candidates to leverage when shaping their political strategy.
Voice shopping remains an emerging payment and commerce channel rather than an established consumer behavior. Although millions of consumers have access to voice-enabled devices, estimates of actual purchasing activity vary considerably, raising questions about how quickly voice commerce will achieve mainstream adoption.
Still, expanding use cases demonstrate the potential of the technology. From retail purchases to voice-enabled donations, organizations are finding new ways to turn smart speakers and digital assistants into transactional platforms. Continued adoption will ultimately depend on whether consumers find voice payments sufficiently convenient, secure, and useful to incorporate into their everyday purchasing habits.
Overview by David Nelyubin, Research Analysts at Mercator Advisory Group
