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The hope of conducting retail transactions via voice assistant

You can find Siri, Alexa and Google Assistant in more and more living rooms. However, Germans still rarely use the smart speakers for shopping.
By Tobias Weidemann February 15, 2019
The hope of conducting retail transactions via voice assistant

There is hardly a topic at e-commerce conferences that retailers and service providers associate with such high hopes as Conversational Commerce or Voice Commerce. Whether with Siri, Alexa or Google Assistant, ordering goods by voice is often thought to be the next big thing. But it may take some time before we naturally do our grocery shopping or order our pizza using Alexa or Siri.

According to a study by Capgemini, 36 per cent of Germans use voice assistants as part of their everyday lives. 84 percent of these users do so via their smartphones, but the proportion of users of smart speakers—the dialog devices from Amazon Echo to Google Home—will increase rapidly in the coming months. According to the market researchers at Canalys, around 100 million such devices can be found in households around the world and, in Germany, 11 million devices were sold by the end of 2018. “Voice assistants can finally keep pace with human speech recognition this year, thus finally making it convenient for users and therefore exciting for companies,” predicts Martin Arnoldy, Head of Consumer Goods, Retail and Transport at Capgemini in Germany.

 

Only a few people have tried it at all (so far)

But we are not far away from shopping by voice. The owners of the devices listen to significantly more music than the average user, ask for news or weather forecasts, control their smart home devices or stream films to their TV. But shopping? So far this has not taken hold although, according to the Consumer Barometer of KPMG and the Institut für Handelsforschung (IFH Cologne), 39 percent are interested in it. A mere two percent of the owners of an Amazon Echo are said to have been on a shopping spree using Alexa. 90 percent stated that they did not take the opportunity again following a one-off purchase.

Why is this the case? Voice Commerce is not yet suitable for the mass market, at least not at this point in time. It takes some preparatory work before a device can guide you through the purchase process without much difficulty. “Alexa, order a case of beer and three bags of peanuts” assumes that the device knows which brand the customer prefers, which is the preferred retailer and which size container they want. A glance at the USA suggests that Amazon and Google in particular are well on the way to developing strategies, with which customers can order the things they need in their daily lives without much difficulty. These strategies use AI to accurately deduce from past buying behavior what my favourite Asian snack is and where I want to buy my toilet paper or cat food.

 

Voice Commerce: first steps in the German retail world

If you talk to online merchants, it quickly becomes apparent that, at least in Germany, we have hardly moved beyond the trial phase. As a representative of an industry association reports, there is still a long way to go before business cases will be ready that are suitable for the masses. Retail chains and delivery services that have made the first steps are thus far anything but euphoric. Experience has shown that interest remains within narrow boundaries and regular customers are rare.

The pizza delivery franchise Domino’s allows you to order your pizza using Alexa after registering on the website. Several grocery delivery services provide the option to place items on a shopping list by voice, even if these still have to be specified afterwards (e.g. which variant or package size of detergent is required). The first steps at the grocery chain Real, where customer can have the special offers read to them, have been even less elegant. At the latest, when customers ask for details, the whole thing becomes tiresome.

 

The bottom line: it will depend on added value and communication

The situation is different in the USA, where Amazon is already well on the way to delivering the desired products of daily life to customers with a minimum amount of complexity. The “buy it again” feature in combination with delivery status messages particularly shows how easy shopping can be. Retail experts believe it is likely that something like this will also become popular in Germany in the next few years. “The big challenge right now consists of introducing consumers to smart voice assistants,” says Dr. Andreas Gentner, Partner and Head of Technology, Media & Telecommunications EMEA at Deloitte. “It is important that the added value for users is the focus of development of voice-based applications and that this is then communicated accordingly.”

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