Many companies that have already established a voice assistant strategy are looking to go beyond to increase customer satisfaction scores. Brands are seeking ways to monetize their voice AI investments without impacting the customer experience. The customer demand is also there, with an estimated $40 billion in U.S. voice shopping revenue by 2022, according to OCC Strategy.
From interactive voice ads to proactive and responsive suggestions, voice commerce is emerging as a real source of revenue for companies looking to prove ROI on their voice investments. Many companies are looking to the future and ways to impact the bottom line directly through voice commerce.
As part of a panel about monetization and voice commerce, Keri Roberts, Brand Evangelist at Readspeaker.ai, sat down with panelists Mike Zagorsek, COO of SoundHound Inc., Elissa Dailey, Director of Strategy at Rain Agency, and Hans Puvogel, COO of Parkopedia. The industry experts discussed monetization trends and market conditions that are paving the way for a new age of voice commerce.
During the webinar, Keri, Mike, Elissa, and Hans spoke about a range of topics on monetization and voice commerce. You can view the webinar in its entirety here or read the recap with answers to additional, un-aired questions from the audience at the end.
Q: What is the current state of the voice assistant market in terms of voice commerce and monetization opportunities?
Mike: It’s still fairly early, but the potential is very high. If you think about voice experiences today from a product standpoint, it really falls into two categories. One is a generalized voice assistant, and those are the ones you see in smart speakers.
The other end of the spectrum is product-specific voice assistants. A lot of companies in automotive, IoT, and television are extending their brands through custom voice experiences. In each of those instances, there’s an opportunity to transact and monetize.
In the near future, we’re going to see a generalized monetization scheme that extends commerce and services through those products in a way that strengthens the connection to brands and the user experience. It’s very early days and the potential is high, but we know that the ability to transact through voice is much more rich, powerful, and collaborative than anything you would get on a screen by itself.
Elissa: In terms of the space today, it’s still fairly limited, still fairly nascent. Every other day you see another article or another study done on this space. Voice commerce is such a hot topic and desired use case that its growth is ineffable.
The types of brands, tastes, and experiences that have really perfected it to date are fairly low cost. Brands have a really unique opportunity now to help define what voice commerce looks like.
Hans: The current state of monetization reminds me of the early days of e-commerce. People have to go through a learning curve. Voice is obviously a key enabling technology. It’s something that will change the user journey and the buying experience.
The opportunities are huge and there’s a lot of promising things happening in the industry right now, in automotive specifically. Voice technology can solve two key problems that we have in-car. One is driver distraction. While you’re driving, you shouldn’t touch a screen. Voice is the solution for that. The second key problem for automotive is payments. Voice biometrics could be used for two-factor authentication for credit card payments.
Q: Are there any barriers or opportunities with the monetization of voice in the auto industry or other sectors?
Elissa: Every barrier can become an opportunity, but some barriers of monetization or voice commerce are user experience-related.
As with any new function, everyone wants to get involved. Sometimes that means the integrity of an experience could potentially be put at risk. We need to make sure that we’re still keeping the customer experience top of mind.
Rather than thinking of voice as a channel, it should be thought of as an interface. How can we potentially integrate voice on a website environment or throughout the shopping journey? Once we start to reframe the way in which we think about it, a ton of opportunities can become available.
Mike: It’s really about getting the infrastructure in place. You have to deliver a fundamentally good user experience. The reason for the rate of voice adoption is because it’s delivering value.
People are increasingly more confident about it, and confidence builds trust. Once you have that trust, the opportunity to transact is there. Then, it’s a matter of building the infrastructure and finding use cases. Adding value is the key versus opening the flood gates of an e-commerce experience—because that’s a pretty big leap for users.
Elissa: One area of opportunity for brands today is to get a sense of their technical architecture. Often, a brand is keen on integrating voice or voice commerce into their overall ecosystem. But when we look at their architecture, it doesn’t support it quite yet. Technical architecture should be prepared so that when companies do want to activate their voice-first strategy, they’re ready to go.
Q: What use cases have you seen that use monetization?
Elissa: Here at Rain, we’ve worked with a lot of brands, but there are two I want to highlight that are doing voice commerce and monetization really well.
The first is Starbucks. We worked with them on a reorder via voice activation. Essentially a user can skip the line and reorder a previous order from a variety of different locations that they visited. The other is a game show network. We work with them on a trivia-like experience, where users can buy consumables. They can also buy or subscribe to monthly subscriptions that will give extra content and points.
With monetization, there are two avenues for companies. One is physical goods. The other is digital goods. Companies need to evaluate what is a great fit for their brand.
Q: How important is a customized voice solution for monetization?
Mike: Custom voice experiences are really important for organizations. A custom, branded voice experience is extending a brand’s product or service into a new environment.
Creating a custom experience means you can extend your relationships instead of being heavily disintermediated by some of the big aggregators. If you’re offering an IoT product or automotive product, the minute your customer leaves that environment and opens their phone, you’ve lost that customer connection. If someone’s in the moment, talking to their appliance, TV, or car, their relationship with that product through voice is unbroken and opens up the ability to extend that interaction into a commercial transaction.
For a lot of organizations, proprietary e-commerce channels faded in a world where things were being disintermediated. Why should it be reawoken? Because the connection to the customers is there through voice, and having a custom voice experience is really the only way to achieve that.
Q: How can a brand create a great user experience but also monetize with voice?
Elissa: It’s all about identifying what you’re able to do extremely well. Just because you have the option or you’re able to put out an experience that has a ton of different features doesn’t necessarily mean you should.
Companies need to ask themselves, what do they have in place? What are the systems to power this experience that also relates to commerce? Do they have certain APIs or certain systems that would need to be integrated? How can they better those? Take a look at what’s most important to your brand. Is it commerce, or is it a really great user experience?
Hans: Focus on one thing and get the one thing right rather than getting lots of things wrong. The relationship with the consumer and the knowledge of the consumer is in many cases lacking, and it’s critical to actually create an experience. If you don’t know your customer, how in the world are you going to create a personalized experience? In many cases, that’s a big problem for automotive companies.
Mike: There are a lot of organizations that are exploring voice or who have voice on a roadmap and are extending themselves. Companies should ask themselves, where does that expertise rest? It becomes a question of when to partner.
The right partnerships can really accelerate and focus innovation in a way that’s a win-win. For example, at SoundHound, we have the Houndify Voice AI platform, which we’re constantly innovating to create stronger, conversational experiences that are multilingual and multi-domain. We’re always going to be focusing on delivering the best user experience so that the companies that we partner with can focus on delivering value to their customers.
Partnering with the right technology providers who are like-minded and are bonded by creating a good user experience is a really important step versus trying to reinvent voice AI within siloed organizations that aren’t experts in voice AI.
It’s knowing how to create the right moment for monetization. Historically, a monetization opportunity would come in the form of an ad, which tends to be interstitial and that can be really powerful. For example, our partner Pandora has already introduced voice ads, and they’re seeing engagement rates that far surpass anything that they’ve seen before.
Beyond that, monetization moments can be a lot more subtle, and they can be proactive and reactive. If they do it in the right way, it’s a win-win because customers see the value.
Q: What should companies know now and consider as they enter the next phase of the voice-first era and move towards monetization?
Hans: Companies have to make sure that they have their infrastructure right. It’s not only about the voice infrastructure. It’s also about the payment infrastructure that needs to be executed to offer a seamless experience across the board.
Mike: It goes back to having a clear voice AI strategy. We know that voice AI is here to stay. Companies should measure the response that they’re getting and then ultimately determine what products and services they have that they can extend for the voice experience at the right time.
We always say, have a strategy and a roadmap, look at the landscapes, figure out what you want to build yourself, and ultimately where you can partner because the ecosystem is becoming a lot broader.
Elissa: Oftentimes, when there’s a new technology, everyone wants to have their share of it or get involved.
Voice doesn’t have to be a catch-all and serve every purpose. The way you approach social media may be different than the way you approach what’s on your website. The same goes for voice.
Brands should also start recontextualizing or rethinking how they define ROI. ROI doesn’t always have to be financial. It could also mean a really satisfied consumer, and then therefore you’re increasing affinity of your brand and loyalty to it.
Q: What changes in voice AI technology are making monetization more of an option now than in the past?
Mike: It’s about making it conversational. Historically, voice interactions were very keyword-dependent, which leaves room for misinterpretation. SoundHound uses Natural Language Understanding (NLU), which is inherently conversational.
The other key element is where the voice assistant is getting implemented. In automotive, for example, 90% of cars will have a voice assistant within the next five years, which opens the door for other forms of transacting and makes monetization more of an option than previously.
Q: Where does accessibility fit into voice AI and monetization?
Mike: I think technology is there to help humans achieve their greatest potential. Right now, the vast majority of interfaces require a physical input. Anybody who has a limitation or an inability to interact in the ways that these products were designed has an additional barrier to accomplish tasks. From a business standpoint, we’re going to start seeing companies invest more in technology that allows people to do their best.
Hans: Accessibility is a key thing. It’s extremely important to give accessibility for people to communicate, transact, and be part of society using their voice. That’s something I’m really looking forward to, not just from a commercial perspective, but also as a human being.
Elissa: It’s our responsibility, as brands, agencies, and innovators to always build with accessibility in mind. Accessibility is just as important as other features of the user experience.
Questions from the audience
Q: Do you think it’s better to develop a baseline platform which you can adapt and deploy a specific voice assistant for each use case, or huge ad-hoc projects in terms of adaptation to the use case?
Mike: It’s generally preferable to have a strong voice AI platform that’s adaptable to different use cases. For example, Houndify is used effectively across multiple industries without major modification. That said, larger projects can still exist, resulting from customization to address data sources and environments. For example, a deep use case can require more effort to deliver proper responses while addressing surrounding challenges like background noise and multiple speakers can add complexity.
Q: Will subscription be the next big use case for voice commerce? Is user trust high enough for subscription monetization to grow?
Mike: Customers tend to subscribe to services in exchange for a specific value. Our sense is that voice interaction is a user interface that unlocks that value, so it’s a question of what’s being offered as a result of voice interaction. We absolutely envision a world where users will subscribe to services (music, audio content, news, etc) in a voice-first environment as part of an overall monetization program.
Elissa: Subscriptions as a “use case” definitely have a place within voice. Generally, digital goods make a ton of sense in a voice environment as they tend to be lower in cost and are a behavior people are already familiar with. For example, paying to get more lives in a mobile gaming environment or paying for an upgraded app feature. Brands that already offer subscriptions as part of their business model (especially those that consumers are already familiar with) should consider how they could extend, and possibly mold, their subscription offering for voice.
Q: What would be a good way to train your Virtual Assistant with new data or use cases without exposing it to the wrong data?
Mike: Data is typically used to train speech recognition, and there are many providers in the market for training data. For NLU, if the use case is narrow, then it’s easier to increase the effectiveness of the voice assistant. For broader use cases, the challenge increases to ensure the information available is accurate (e.g. general knowledge, sports, weather, etc). Having reputable content partners to provide quality content is key.
Q: What does readiness look like for companies that want to capitalize on voice commerce opportunities?
Mike: Platforms are beginning to emerge that allow advertisers to take advantage of voice interaction. For example, Pandora has launched its voice advertising capability and seeing strong engagement. Having a strategy will be beneficial as we expect more companies to include advertising and transactions in the near future through platforms like Houndify.
Elissa: Readiness means having a technical architecture that would support voice commerce capabilities—auditing your backend systems, any APIs you’d need to integrate, etc—to get a sense of how quickly you could activate and/or what may stand in the way is a good place to start.
Brands can also begin to think of voice as a channel for, or complementary to, their marketing campaigns. For example, imagine a scenario in which a user sees an ad for a product like a laundry detergent that features a CTA to “add X brand to my shopping cart”. Thinking through scenarios such as these can open up new possibilities for brands related to voice and commerce alike.
If you missed it live, or if you want to see it again or share with a colleague you can view the webinar in its entirety here.