Voice based e-commerce has been penetrating the market since 2015. Early 2018, saw major brands like Amazon and Google exploiting the capability of voice-controlled AI to change their consumer purchase patterns. More than 20 million voice based devices were sold in the U.S. in 2018 and by 2020 this number is expected to grow to almost 50%. Market researchers predict that currently 1 out of every 5 customer in the U.S is using smart speakers or devices for everyday shopping. This figure is predicted to grow by more than 30% by 2020. When it comes to voice based shopping, Alexa from Amazon is dominating the market with its sale. It acquired more than 70% of the market share in the year of 2018. Alexa is closely followed by Google Home and Google Inc., contributing to other 10-15% of the total market share.
sudden wave of voice search revolution cannot be ignored by key market players. Brands need to understand the importance of creating voice engine optimization strategies as voice search technology will be extensively used especially for shopping purposes. Realizing the momentum with which this technology is influencing the markets, the key players and the consumers recently, Google enhanced its AI-powered Google assistant’s understanding of the English language with an accuracy rate of more than 90 percent and a word error rate of less than 5 percent. Google assistant can eliminate the disturbances occurring in conversations. This rapid development in the voice based functions is one of the major factors propelling this technology’s adoption and use by brands like Amazon and Google. Another interesting factor that can influence the voice based shopping market is the functioning of Google’s search engine results pages. The first organic search result on Google’s search engine results page gets more than 30% clicks. In voice search the scope is smaller thus making it extremely important for the market players to make the best use voice technology for shopping purposes.
Voice based shopping is popular among millennials mostly for shopping of lower value products. Grocery shopping, entertainment shopping, electronic shopping, garments are some of the important market segments where purchases are made through voice commands. Amazon Echo is leading voice shopping market especially when it comes to household shopping. One of the biggest reasons for Amazon Echo’s popularity is its ability to link to a consumers Amazon account. It syncs the essential consumer information like preferences, expenditure window, frequently shopped categories and product type. Also, the fact that Amazon Echo helps in making lists, setting alarms, making calls and sending messages has contributed to its popularity. Millennials looking for easy, comfortable and affordable options for shopping dominate the consumer segment for online shopping but with voice shopping, researchers have found out baby boomers to be dominating the consumer segment. Voice based shopping can also incorporate customer reviews on devices to help brands develop the business. Shoppers prefer to buy the products that are recommended and have positive customer feedback, as they can’t see the product.
Some other brands expected to make an entry in the voive based shopping market are Siri by Apple and Bixby by Samsung. Recently audio companies like Sonos, JBL, Marshall and others have also created speakers which work brilliantly like Amazon’s Alexa and Google Assistant. The market for voice based shopping is segmented based regional analysis into North America, Europe, Asia Pacific, South America and Middle East and Africa. North America contributes the highest among these segments, followed by Europe and Asia Pacific. More than 60% of smart speaker owners make a purchase every once in a while. Other market segment to focus on is the type of products being bought via voice based shopping. The most dominating category of products consumers prefer to buy is consumer packaged goods. Sale of consumer packaged products was seen growing by few percent through voice based shopping compared on online shopping on the same platforms in 2018. CPG products were also bought more often through voice assistants and devices. In CPG products, surprisingly, the categories dominating the market last year were pet food followed by laundry and baking & cooking.