“Alexa, what will be your impact on e-commerce?”
Voice is now a consumer channel, with conversational commerce expected to reach $40 billion by 2022. Does your organizational strategy include voice? It should.
Building on the rapid growth of e-commerce over the last few years, voice commerce gives your customers a way to tell you exactly what they want. Consumers increasingly turn to virtual assistants and smart speakers like Alexa and Siri to not only answer their questions at home and on the go, but to make purchases without so much as the click of a mouse or tap of a screen.
Companies leveraging voice commerce are enjoying competitive advantage and the future of voice commerce presents another ripe opportunity for brands seeking to build on the success of e-commerce.
What is voice commerce?
Voice commerce is defined as the process where consumers search for and purchase products using voice commands. It is also referred to as voice shopping or voice-activated shopping. Customers interact with smart speakers and voice assistants or virtual digital assistants (VDAs) such as Amazon Alexa, Google Assistant, or Apple’s Siri to make online purchases.
Rather than typing on an interface such as an app on a smartphone or a browser on a laptop, customers ask their favorite voice assistant for answers to questions, recommendations, and to perform simple tasks like reordering previously purchased items that need to be replaced.
A layer deeper, voice commerce operates on automatic speech recognition (ASR), also called voice recognition or speech-to-text.
How does voice commerce work?
While voice-activated shopping creates new shopping experiences for customers, it also opens up new channels for e-commerce businesses looking to obtain a competitive advantage. Automatic Speech Recognition (ASR) and Natural Language Understanding (NLU) are core components that enable voice-commerce.
Automatic Speech Recognition technology or ASR allows human beings to use normal speech or voice to interact with smart devices or voice assistants.
Natural Language Understanding (NLU) refers to the ability for computers to understand intent with the help of grammatical structure of and sentence and semantics. Humans have the natural ability to process language and understanding, whereas for machines a combination of such capabilities are key in understanding the intent behind human speech captured by smart devices or voice assistants.
ASR, working with the artificial intelligence and machine learning that powers chat bots, allows consumers to search for and buy products and services online through voice commands.
Virtual assistants translate speech to text, conduct searches, and make personalized recommendations at the speed of conversation. From there, customers decide to buy or not to buy.
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Voice commerce vs. conversational commerce
Although the terms may seem synonymous, voice commerce differs from conversational commerce by being more specific to using voice assistants to search and make purchases online.
Conversational commerce allows consumers to interact with brands and businesses through voice assistants as well as chatbots, SMS, and apps like Facebook Messenger and WhatsApp. The conversation takes place through voice or through typing text and carrying on a conversation within a single app.
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Hey Alexa, what are my deals?
Sure, VDA technology isn’t perfect – it’s still a work in progress when it comes to accuracy. But the growing reliability and popularity of voice search combined with the security of e-commerce is making voice commerce an increasingly popular option.
Already, 65% of 25–49-year-olds interact with VDAs every day. As younger consumers like Gen Z—who tend to be comfortable with voice assistants—continue to make and influence more purchasing decisions, voice commerce will only grow.
For convenience, it can’t be beat. Customers can order or reorder items like groceries, paper towels, or laundry detergent while they’re thinking of it without having to drop what they’re doing and type on a phone or computer.
Making ordering as simple as telling a smart speaker what you want eliminates the friction of typing, scrolling, comparing, choosing, adding to cart, and checking out. Simply ask and you shall receive.
Because virtual assistants like Alexa have a wealth of data about a consumer’s past purchases, preferences, recent search history, and other behavioral information, voice-based e-commerce offers better personalization. It’s far more likely to deliver the right recommendations, at the right time.
Delivering personalized results and recommendations to customers shopping through voice-enable assistants will continue to give competitive advantage to the businesses that get it right.
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By the numbers: Voice commerce stats
Whatever privacy concerns consumers had about having a VDA such as Alexa, Siri, or Google Assistant in their home – always on, always listening – appear to have faded.
Whether consumers are saying, “Hey, Siri,” “Hey, Alexa,” or “Okay, Google,” it’s clear that many have embraced VDAs. A few stats:
- 72% of the people aware of voice assistants like Siri and Alexa have used voice-enabled devices
- By 2024, the number of digital voice assistants is expected to reach 8.4 billion units – a number higher than the world’s population
- 80% of consumers, on average, who have made purchases with voice assistants are satisfied with their experience
- Voice commerce is expected to exceed $30 billion by 2024
- Voice commerce grew 72% in North America due to COVID-19
With so many consumers having searched and bought online using voice assistants, this channel is primed for growth. The big winners are likely to be businesses that get ahead of the competition by preparing now.
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Get customers talking & let them know you’re listening
While some consumers might not be comfortable with voice commerce, or feel weird talking to Siri or Alexa outside the home, the trend is clearly moving toward weaving virtual digital assistants into everyday life.
It’s one less thing to remember to do later, lightening your customer’s load and giving them just a little more brain space for the day. The convenience of ordering without pulling out your phone or hunching over a laptop will pay dividends—to you and your customers.