The advent of AI and conversational UX is poised to fundamentally change the modern business landscape. With two recent announcements about improvements to Amazon’s Alexa platform, the opportunities to capitalize on the rise of conversational commerce have never been so promising.
Amazon’s Alexa Bridges the Gap Between Conversational UX and Purchase
Late last month, Amazon announced a small yet monumental improvement in how Alexa helps bridge the gap between users’ digital and physical experiences: Alexa can now automatically discover, enable, and launch skills based on natural speech interactions with users.
This change came in response to one of the biggest barriers for brands and Alexa users alike. Originally, users had to know the exact name of a third-party skill in order to install and use it. Now users’ natural spoken phrases and requests can prompt Alexa to discover and suggest third-party skills to meet their needs, allowing users to seamlessly connect and engage with brands without ever leaving the conversational experience.
Yet another recent Amazon announcement presented an even greater opportunity for brands: Developers can now generate revenue through their voice applications on Alexa-powered devices using in-skill purchasing.
While users were previously forced to leave a conversational interaction in order to complete a purchase (usually to enter payment or shipping information on a computer or mobile device) they are now able to shop purchase suggestions offered by Alexa. From there, they can complete a purchase using the payment information already associated with their Amazon account, all without ever leaving the conversational interaction.
These improvements in Alexa functionality not only pave the way for brands to interact with their customers in new and meaningful ways, but also finally cement conversational UX as a potentially lucrative method with which brands can do business.
Any organization that had prior reservations about launching a robust Alexa skill initiative will definitely feel the ripple effect of these changes. The Alexa platform has finally made it possible for users to discover, engage, and ultimately do business with brands whose products and services they could benefit from — all through the medium of Alexa Skills.
Simply put, these enhancements virtually eradicate the factors inhibiting the monetizing of an Alexa platform experience. Brands are now that much closer to connecting with their target customers in an exclusively conversational interaction — a fact that will usher in a gold-rush on the platform as businesses aim to enable users to purchase their products with little more than a word or phrase.
This presents an enormous opportunity for businesses: Brands can more easily position their products in millions of their customers’ homes and more seamlessly integrate into the digital and physical lives of Alexa users. This shift is a likely catalyst for an anticipated rise in Alexa-enabled household speaker penetration, from 13 percent today to nearly 55 percent by 2022, according to data from OC&C Strategy Partners. That same data also expects that voice shopping revenue will hit $40 billion within the next four years — up from only $2 billion today.
But the opportunity also presents a challenge: As more brands flood the Alexa platform, successful brands will be the ones that fully commit to creating meaningful experiences via conversational UX. It will no longer be enough to simply be present and capitalize on the future of voice commerce. Brands will have to create immersive digital experiences that stand out among the rest.