Why the Popularity of Amazon Alexa at CES 2020 Matters to Advertisers

Why the Popularity of Amazon Alexa at CES 2020 Matters to Advertisers

Amazon

The Amazon Alexa voice assistant cast a big shadow over CES 2020, the premier annual event for showcasing new consumer technology. Amazon demonstrated a number of product integrations with Alexa. They matter because they point to a possible way that Amazon could lead online advertising.

The Battle for a Voice-First Future

Amazon is fighting a fierce battle with Apple and Google to lead the uptake of voice-based products among consumers and businesses (with Microsoft and Samsung also stepping up their own efforts). More than one quarter of Americans own voice-activated smart speakers, according to Voicebot.ai and Voicify. Amazon’s Echo leads the pack, but Google is catching up, as reported in The Motley Fool.

To win the war for voice, Amazon, Apple, and Google need to collaborate with product manufacturers to incorporate their voice assistants into product design (or through aftermarket upgrades).  And CES is where those integrations are demonstrated. For example, Bosch, the maker of smart home appliances such as dishwashers, announced an integration with the Apple Siri voice assistant. And a number of manufacturers ranging from Belk to GE announced integrations with Google Assistant, Google’s voice assistant.

But Amazon outflanked everyone. A wide variety of manufacturers ranging from bed maker Dux to helmet maker Jarvis demonstrated how they’re relying on Alexa to make it possible to use their products with our voices.  But it wasn’t just the sheer number of integrations with manufacturers that mattered – what really caught my eye was how Amazon is making it easier for people to actually purchase things.

Making Purchases Is the Holy Grail of Voice

As I wrote in a recent blog post, people still use voice to do more mundane tasks such as checking the weather. Making purchases, though, is the Holy Grail of voice. Voice commerce is a far more complicated undertaking. And at CES 2020, Amazon showed that it is up for the challenge. Amazon announced that in 2020, automobile drivers will be able to use Alexa to purchase gasoline. As Amazon said, “Later this year, customers will be able to say, “Alexa, pay for gas” to easily purchase fuel at all 11,500 Exxon and Mobil stations. The transactions for this new Alexa feature are made through Amazon Pay and powered by Fiserv, a global financial services technology provider.

The ability to pull off voice-activated purchases requires Amazon to work closely with ExxonMobil – an example of the collaboration required to make voice a reality. If Amazon and ExxonMobil can make the purchase of gasoline as easy as making a voice command, then manufacturers and retailers will be encouraged to adopt voice for purchases, too. (Think of appliance makers turning the Amazon Dash device for order replenishment into a consistently reliable voice-first experience.)

Why CES 2020 Matters to Advertisers

Why do these announcements matter to businesses that advertise online? Well, here is a telling statistic: even though Amazon leads voice, Google pretty much owns online advertising. Google commands 37 percent of digital ad spend. The next largest competitor, Facebook, has 22 percent of the market. Amazon lags behind with 8.8 percent. But – Amazon is still very new to online advertising. It did not start dipping its toes into online advertising until 2008. Within 10 years, Amazon had become one of the big three of online advertising.

Amazon is rapidly threatening Google’s and Facebook’s leadership by offering new tools that help businesses advertise on Amazon – and off Amazon. We’ve written about some of those tools, such as my colleague Samantha Coconato’s posts on Amazon Video Ads, Amazon Display Ads, and Amazon Sponsored Ads. Those ad services capitalize on the reality that Amazon has become an increasingly popular way for people to search for products – even more popular than Google.

But Amazon knows the world is changing from text-based to voice-based search. Voice search is not “taking over.” But voice is becoming more common. Per a Microsoft study in 2019, 72 percent of people surveyed had used voice search the previous month. Amazon is preparing for the time when voice will reach a tipping point, and businesses will have no choice but to employ voice-based advertising and search engine optimization tactics into their game plans.

And that’s why the product integrations matter. By making Alexa the de facto voice assistant in everyday products, Amazon wants people to be more comfortable using their voices to use and buy things. Encouraging the uptake of voice among consumers helps Amazon position itself as the premier advertising partner for businesses.

Whether Amazon succeeds remains to be seen. But as Google and Apple compete with Amazon to integrate voice, it’s clear that advertisers need to be ready to adapt.

Contact True Interactive

To make online advertising work for you, contact True Interactive. We’re an independent agency that optimizes branded interactions to drive traffic and increase sales.

Photo by Status Quack on Unsplash

Alexa Stars in Amazon’s 2018 Earnings Announcement

Alexa Stars in Amazon’s 2018 Earnings Announcement

Amazon

The conversation about the voice interface no longer focuses on whether we’re entering a voice-first world. The questions have quickly shifted to who will lead it and how soon using our voices to search for things and manage our lives will be as second nature as texting.

My teammate Taylor Murphy recently discussed an answer to the first question: no single firm “owns” the voice-first world, but both Amazon and Google have a strong lead. The answer to the question about how quickly voice will saturate our lives comes down to how soon people will be comfortable using voice to do tasks that require extremely high levels of trust in the device you’re using, such as buying a product or handling an emergency. Most people use voice to do mundane things like check the weather. Few actually ask Alexa or Google Assistant to order a pizza or conduct other transactions. That’s because we’re not quite ready to trust a device to interpret our speech with enough accuracy.

The major players in voice are trying to address that issue. In Amazon’s January 31 earnings announcement, CEO Jeff Bezos said, “The number of research scientists working on Alexa has more than doubled in the past year, and the results of the team’s hard work are clear. In 2018, we improved Alexa’s ability to understand requests and answer questions by more than 20% through advances in machine learning, we added billions of facts making Alexa more knowledgeable than ever, developers doubled the number of Alexa skills to over 80,000, and customers spoke to Alexa tens of billions more times in 2018 compared to 2017.”

Normally CEOs comment on high-level, visionary messages in earnings releases, such as top-line growth, major product launches, and corporate strategy. I find it interesting that Jeff Bezos decided to talk about Alexa’s accuracy, and the number of Alexa skills developed. What does this tell you? That Alexa is strategic to Amazon. Jeff Bezos already saw the voice-first world coming, and he decided to help shape it.

So what does all this mean to businesses that advertise online? It means that before you know it, we’re going to turn the corner with voice accuracy. Consumers will use their voices for e-commerce. So it’s important to prepare. For example, as noted previously by my colleague Taylor, advertisers should evaluate their search queries and look for conversional text (“Who,” “What,” “Where,” “When,” “Why,” and “How” are great phrases to focus on). Also, pay attention to any long-tail queries that include a natural phrase such as “near me” or “can I get the number for . . . ”

The above advice applies not only to optimizing content on your websites but also preparing your paid media, such as paid search campaigns. Thinking like a customer might be the most effective way of ensuring your digital marketing efforts are visible to RankBrain – part of Google’s core algorithm that employs machine learning to draw the most relevant results from a search query. RankBrain collects multiple data points like keywords and the searcher’s location in an attempt to identify the intent of a search to then pair the query with the most relevant and valuable result.

Remember, voice isn’t just about using Echo or Google Home. It’s also about doing voice searches on devices where ads appear.

If you sell products on Amazon, the sense of urgency to adapt to voice is even greater. Amazon is clearly using its own retail platform to sell more Echo speakers, and more Echo speakers means more people using their voices to find and eventually buy things on Amazon.

You don’t want to be a laggard in that world. Contact True Interactive to make your online advertising flourish.