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Grocery gearing up: The battle for the home and conversational commerce

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One reason more consumers don’t buy groceries online is that they find it too complicated, but this is about to change as the big tech giants, Amazon, Google, and Apple, duke it out in “conversational commerce” – that is, buying via voice-activated assistants instead of computers or mobile devices.

As the devices gain traction, it will create the potential for brick and mortar retailers to integrate their ecommerce programs into one of these digital ecosystems and ride the next wave. Walmart has already done this with Google, but that won’t be the last partnership we’ll see.

These big players are working hard to improve their voice recognition, but the ultimate goal is to win the battle of the home, so that they capture a central role in how consumers use digital to make their lives easier and more convenient (such as controlling in-home devices, searching for information, and/or shopping).

Each of the big tech companies brings different strengths to the fight

  • Amazon’s website data gives them a head start in shopping. They also lead in smart speaker installation with 11 million Echos sold, and they have negotiated with Microsoft to give users access to their office calendars.
  • Google has an installed base of Google Home systems, and access to an enormous quantity of data that can be used to train their digital assistants – a key requirement for fine tuning the effectiveness of artificial intelligence.
  • Apple will build on their well-established relationships with more than 300 million iPhone users worldwide who are already familiar with Siri, their digital assistant. They also have access to lots of consumer data.

New understanding of voice-activated digital assistants comes from two recent studies

First, Ron Lunde, a BMC Black Belt, shared data from Prosper Insights and Analytics based on interviews with owners of both Amazon Echo and Google Home that shows how consumers are using these devices.

  • A third use them to add to their shopping list.
  • 10% actually use them to purchase a product.

However, this doesn’t fully describe the bond consumers are beginning to build with these devices. Almost half see them as “like a friend to me.”

Second, in the recent Field Agent Research Report “Shopping on the Cutting-Edge: Shopper Attitudes Towards Three Trailblazing Retail Technologies,” their survey of Echo owners found those who bought products via these devices:

  • Valued ease of use and convenience, particularly in reordering frequently purchase products, but were troubled by their inability to see the products, the difficulty of comparing them, and that the devices sometimes didn’t hear correctly.
  • Purchased most commonly in three categories:

1.) 56% pet products (in households with a pet)

2.) 43% music

3.) 38% household products

Looking ahead

While Amazon leads today in voice-activated digital assistants for the home, it will be challenged. Google will move beyond partnering with Walmart to secure a larger footprint in conversational commerce, and it’s hard to imagine that Apple, despite being late to the party, won’t strive to leverage their base of iPhone owners.

As the competition heats up, expect a significant increase in the number of households that become comfortable buying groceries online. One key to brick and mortar retailers capturing the full potential of this shift will be to find ways to partner with either Google or Apple in their efforts to win the battle for the home.

Retailers can get early insight into how their customers are leaning by asking which ecosystem they favor. Now is the time to find out.

Learn more about how to connect with the modern grocery shopper here

This post was originally published by Bill on LinkedIn, and was syndicated with permission. 

Bill Bishop
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Bill Bishop

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