Report Description:
“Hey Alexa, Buy me a Shampoo” Or “Google, Buy the grocery list”
Well, this is what Voice based shopping is all about. Talking to your devices and getting your work done. This revolutionary voice search technology can be your new go to shopping destination.
Your Basic guide to Voice Based Shopping
Voice based shopping is a new trend owners of digital assistants that work by recognizing voice, natural language processing and speech synthesis are following. Digital assistants and voice based devices help users buy products only by commanding tasks to the devices. Smart devices and speaker records consumer information like address, payment details, and contact details. However, with Alexa and Google these details are already updated during the registration process. This pre saved information makes it easier for the devices to take orders and process it.
At a compound annual growth rate of 24.4 %, the size of the worldwide Voice Based Shopping market is projected to reach USD 28.1 billion in 2027.
Voice Based Shopping is revolutionizing the way consumers are buying. Many across the globe prefer e-commerce mode of shopping. Some of the factors driving the e-commerce market are the ease of shopping anywhere and anywhere, attractive offers, wide range of products and quick delivery and return systems offered by e-commerce vendors.
Trends, Benefits and Challenges of Voice Based Shopping
Voice based shopping is extremely convenient for buyers as it allows reordering based on previously placed orders at the same time it gives various options and alternatives for the same ordered product. Smart devices save information regarding your product preference, brand, price bracket, quantity to reorder the same product in the future.
However, voice based shopping has many challenges to overcome, to have a brighter and longer future. Some of the challenges faced by the voice based shopping industry are:
- Difficulty in voice recognition, as the concept is all about voice there might be times the system doesn’t understand and comply with your language. This might be due to technical difficulties or change in voice tone due to several reasons.
- The ordering process is simple in Alexa since the details are already fed in the system. Incidents of accidental purchases are reported owing to the ease of process. Especially in case of children where accidental order placement can also take place. Amazon not only orders for you, but also analyzes and saves your purchases.
- Ordering the wrong product is also possible as buyers can’t see the product here like in the case of app shopping. No provision of visual aid to analyze a product before purchasing can cause problems for the voice based shopping market. But then again, there is fair change of the convenience provided by these devices overpowering its limitation of visual aid.
These challenges are expected to be resolved in future, with the help of growing innovation in various phases of technology.
Future of Voice Based Shopping
Currently, only a small percentage of people owning smart speakers and devices use it for shopping purposes, not more than 305 but, this number is expected to shoot up to around 50% by 2020. However, the industry is just is still budding and the pace at which technology is developing, in no time it will get stronger. At the foremost, there is a need for better and enhanced security, to avoid accidental orders which seems to be a problem for market players. Reports of devices, not being able to understand the voice command are constantly heard, providers need to work around this and offer better user experience to buyers.
In the future, these devices will give more personalized experience to the buyer at the same time understand different voices in the same house. Another, feature to look out for in the voice based shopping market is the ability to talk to your cars, refrigerators, lamps, fans and other devices. The automotive industry would also witness new technologies and growth by car speech recognition. 2018, saw car speech recognition as becoming standard and would be growing in the coming years. Amazon has partnered with Marriott Group to launch Alexa exclusively for hospitality. This will help consumers undertake simple tasks like ordering towels, calling and controlling room lighting.
Voice Based Shopping Market Scope
| Metrics | Details |
| Base Year | 2020 |
| Historic Data | 2018-2019 |
| Forecast Period | 2021-2027 |
| Study Period | 2018-2027 |
| Forecast Unit | Value (USD) |
| Revenue forecast in 2027 | USD 28.1 billion |
| Growth Rate | CAGR of 24.4 % during 2021-2027 |
| Segment Covered | by Deployment Mode, Technology, Vertical, Regions |
| Regions Covered | North America, Europe, Asia Pacific, Middle East and Africa, South America |
| Key Players Profiled | Alibaba, Amazon.com, Inc., Baidu Inc., Cerence Inc., Google LLC, Huawei Technologies Co., Ltd, IBM Corporation, LumenVox LLC, NCR Corporation, Nuance Communications, Paypal, Paysafe, PCI pal, Sensory Inc., Square Cash, Inc., ToneTag Inc., and VibePay |
Frequently Asked Questions (FAQ) :
To get latest version of voice based shopping market report can be obtained on demand from the website.
The base year for the report is 2018 in voice based shopping market.
Analyst Commentary:
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 customers 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.