Blog: Consumers are talking and retailers are listening

The human voice is an effective tool of communication. Smart devices employ voice recognition, speech synthesis, and Natural Language Processing (NLP) which is a branch of artificial intelligence that helps computers understand, interpret and manipulate human language into valuable information. This allows customers to browse for products, make payments and fulfil business-to-customer interactions, the voice has never been more important. A new study by the Capgemini Research Institute suggests 87% of executives from large organisations recognise the voice as an important strategic sales channel.

Using text-based queries to find products is expected to become a thing of the past. Instead, a consumer will commence the purchasing process with the words ‘Okay Google’, ‘Hey Siri’ or ‘Alexa’. By 2022, the use of voice assistants to interpret and act upon our vocal commands is expected to be the preferred option of consumption.

The growth trajectory for the use of the voice assistant is driven by several factors; firstly, it’s convenient. In the modern-day world, a frictionless process is sought after by the consumer. With conversational commerce, consumers can complete a purchase without lifting a finger. The convenience of the voice assistant also stems from the reduction of processing times and ease of making repeat purchases. When Virgin Trains utilised the Amazon Alexa to book train tickets, the average booking time was reduced by 5 minutes. Furthermore, voice assistance addresses the growing consumer appetite for a personalised service. By extracting purchasing patterns and behavioural habits, retailers can sell more relevant products/services tailored to the individual.

When done correctly, the use of voice assistants can generate significant quantifiable benefits. Research shows 76% of global executives realise the value derived from voice assistants. One key benefit is the uptake in Net Promoter Score, a measurement of loyalty assessing the likelihood of gaining new and repeat business. Satisfaction rates are also mirrored by consumers- 62% of consumers surveyed by Capgemini were satisfied with a voice-based speaker. For those using a voice assistant on a smartphone, satisfaction levels rose to 71%

Voice assistants in action

Partnerships between retailers and voice assistant providers have been led by Amazon and Whole Foods Market, shortly shadowed by Walmart and Google.  Following the acquisition of Whole Foods Market by Amazon in 2017, the private label advantage the tech giant holds controlling the voice technology and the Whole Foods stock was realised. A consumer who runs out of milk can use a voice-activated Amazon device to order a replacement. Amazon customers are converted into paying Whole Foods consumers as the tech giant exclusively offers the products of its subsidiary brand, which are better suited to voice-orders.

However, for the vast majority of business leaders, the question of ‘how to prepare for the voice revolution’ remains unanswered.

Context is key

The need to understand the purchasing habits and behaviours of consumers is crucial. Understanding the motivations, expectations and lifestyle choices are some of the factors that set the context for sales.

Once identified, retailers can not only personalise products that fit the consumer but create completely new environments in which to shop. Mercedes Benz, BMW, Tesla and Ford have announced the integration of in-built voice assistants. Giving drivers the option to use voice commands in order to carry out tasks such as booking appointments whilst driving. Although the use of voice assistants is being rapidly rolled out across the automotive industry, a modest approach has been adopted by the retail banking sector. Despite Clydesdale and Yorkshire Banking Group partnering with the Amazon Alexa to allow customers to participate in 2-way conversations regarding their personal financial information. Retail banking by nature is centred around trust. Customers of traditional banks often prefer chat assistants as opposed to voice interactions. Thus, the range of services the voice assistant is being extended to in retail banking is not as widespread as other industries – at least for now.

The accurate understanding of where and to what extent voice assistance is used in the consumer purchasing journey will be the make or break for organisations wanting to emulate the successes of Whole Foods Market and Walmart.

Voice assistance does not mean isolation

It must be remembered that the virtual assistant is a form of conversational interface. For it to be beneficial, product data for conversational language needs to be clear and concise. Optimised voice recognition ensures that the customer is presented with the relevant options and not the unwanted voice response of ‘Sorry, I can’t help with that yet’. The type of language used to direct a voice assistant to find a product or a service would be similar in tone to the vocabulary and sentence structure that is used when speaking to a friend. For effective implementation, organisations are required to have a thorough understanding of the conversational tones, words and phrases used by their target consumers in order to devise a thorough voice engine optimisation strategy. At risk of the voice assistant becoming a gimmick, its adoption should also feed into an organisation’s omnichannel strategy and leverage existing business systems. This would ensure that it becomes a powerful tool that adds value to both consumers and retailers.

The Conversational Interfaces research predicts voice commerce will continue to grow. Although the rise of the interfaces aren’t without their challenges, advances in technological improvements will increase its functionality. Those organisations who were slow to adapt to the growth of online shopping have spent years trying to catch-up. We can only hope that same pattern does not repeat itself.

Author

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Maya Prentis

Associate Consultant