Can retailers win consumers with voice technology?

2020/03/13 Innoverview Read

With Siri, Alexa and Google voice assistants, help is just a command or question away. The convenience with such technology should, in theory, be appealing to consumers. Research suggests not so much. 

Though consumers think voice technology is useful, they're not buying into it as much as analysts anticipated. Of the consumers who do adopt the technology, 94% of users find voice technology easy to use and think it saves time and improves their quality of life, according to a 2019 Adobe report. A February 2020 report from eMarketer estimated that 21.6 million people will have purchased via smart speakers by the end of 2020, about 2 million fewer consumers than previously predicted. 

To drive voice commerce, the user experience of these technologies needs to improve and security concerns must be addressed, but there's hope for the future adoption of the technology among younger consumers, experts told Retail Dive. 

Optimizing voice search

For now, consumers typically use voice commerce for re-ordering common household goods such as toilet paper and laundry detergent, not so much visual or more complex purchases like apparel, flights or concert tickets, said Vivek Pandya, Adobe lead analyst. 

With more complex purchases, Pandya said, "people are thinking about how many attributes are associated with what they're interested in buying and how satisfied they will be with the end product. So that's going to impact their likelihood to want to shop via voice or just get online on their phone or their laptop and get a full view of everything that's available to them." 

In addition to smaller repeat orders, Dinesh Bajaj, senior vice president and industry head of retail for CPG and logistics at Infosys, said voice assistant technology would be useful for customer service inquiries.

The advantage that Amazon has with the Alexa voice assistant is its e-commerce component. However, Google may be better positioned to provide consumers with better search results and query answers, because the company indexes most of the internet, Jason White, director of SEO at PMG, said.

In-car voice technology seems to be a new frontier for voice adoption. A January 2020 report from Voicebot found that the number of U.S. in-car voice assistant users increased from 114.1 million users in September 2018 to 129.7 million in January 2020. Amazon announced in January that it was expanding further into in-car commerce and voice-assisted services through partnerships with car companies, gas stations and vehicle technology manufacturers. 

As car manufacturers integrate voice assistant technology like Apple and Amazon's assistants into vehicles, White foresees a near future where voice assistant technology in cars will be able to communicate with in-home technologies to, say, turn on home heating and cooling or play mood music upon arrival. 

"Our lives are becoming more and more like a music video where we'll be able to seamlessly flow from in-car experience and listen to the same tunes along the way," White said. 

Younger consumers are showing that they are willing to give the technology a shot. According to a 2019 Paysafe report, 32% of consumers over the age of 25 are comfortable with ordering or making payments through their vehicle's entertainment system, and 39% of Gen Z consumers said the same. 

Improving user experience

Despite the novelty and cool factor of voice assistant technology, experts told Retail Dive that voice commerce has a long way to go to perfect the user experience for consumers. 

Some users, for example, may open the box containing their brand new voice assistant device only to discover that it may not respond so well to their accent, Bajaj said, adding that voice assistants had a hard time pronouncing his name at first. Voice assistants require a myriad of data to be "trained" to understand voice commands and queries, but these technologies have improved their accuracy over the years, he said. 

Besides failing to understand users' pronunciation, Bajaj said voice assistant devices might also have trouble distinguishing between users' voices and the background noise of their television or other audio devices. Devices also will need mechanisms for ensuring authorized purchases, so that underage children or other unauthorized purchasers can't buy goods via voice transactions, he added. 

"There are cases that you'll find in the public domain where a six-year-old girl ordered a dollhouse," Bajaj said. "It is a reality that — since there's no way for the device to understand yet whether the person is an authorized person or not — it just went through." 

Both Bajaj and White said the ability of voice assistants to connect to screen devices allows users to browse for products. With screenless voice assistant devices, consumers aren't able to scroll and therefore are only presented with one search result, White said. Adobe's survey found that 85% of voice assistant users access the technology through their smartphone, followed by 39% via smart speakers. 

"One of the things that I'm very curious about is if they're going to accept the first answer that's given to them," White said. "In the case of a voice answer to somebody's question... They're not able to look and see what they feel is a close match to their question or from a new source that they trust."

While some say voice technology's responsiveness needs work, one perhaps surprising area where the tech is gaining consumer approval is with advertising. With voice advertising, brands have an opportunity to effectively interact with consumers through ads tailored for that medium, said Pandya. Consumers tend to find ads integrated via voice assistants to be less intrusive, more compelling and more appealing, he said. According to a February 2019 Adobe report, 38% of survey respondents said voice ads are less invasive than those on TV, in print, online and on social media.  

"You really have the best of both worlds right now, because you can essentially speak to your consumers and have them recall the advertising, because it's not as saturated advertising environment as certain places like online websites," Pandya said.

Calming consumers' concerns

In addition to the technology needing a better user experience, consumers also have concerns about cybersecurity and privacy. This skepticism comes as retailers have had to contend with costly data breaches that leave their customers vulnerable. 

Paysafe's 2019 report found that of consumers who don't feel comfortable authorizing payment via biometrics, 45% said it was because they don't want companies to have access to personal biometric details. Thirty-five percent of respondents also said they don't know enough about biometrics to trust the technology. 

Moreover, retailers regularly make headlines for data breaches, which can cost companies an average of nearly $4 million, according to 2019 research from IBM. Beyond the costs to companies, there's also the threat of breaches exposing consumers' most intimate biometric data.

To win back consumers' trust, retailers not only need to be more forthcoming about how they use consumer data overall, but also how they secure payment and other data, including voice technology, Pandya said. 

Instead of showing consumers a "20-page privacy statement" to ask for their consent, brands need to concisely explain how the data they collect will improve user experience, Bajaj said. The passage of the GDPR legislation in Europe and the California data law has given consumers more agency over their data, he added.

Research appears to suggest a generational divide among early voice assistant adopters. According to the Paysafe report, 52% of Gen Z consumers would, for example, be open to signing up for a subscription service like Netflix via voice assistant technology, compared to 43% of consumers ages 25 and up. The report also found that 51% of Gen Z shoppers would be fine with paying for an entertainment service (like buying a movie), compared to 45% of consumers ages 25 and older who said the same. 

Millennials and Gen Z consumers who grew up with the internet are more comfortable with giving away their data for better service than more skeptical elder consumers, Bajaj said. Retailers need to emphasize that their data collection efforts will provide consumers with more tailored campaigns, discounts and an overall more personalized shopping experience, he said. 

"That value articulation is something that I haven't seen the brands and the retailers do," Bajaj said. "If you really want that data, then please articulate what is the value that you will provide to the consumer."

(Source: Retail Dive