To help consumers order and pay for the items they love, retailers are turning to technology that provides shoppers an alternative to visiting a store or tapping through a mobile app. That is, retailers are turning to the world of voice-enabled commerce. A diverse group of companies — from grocers and eateries to movie ticket vendors — are now supporting voice ordering through voice assistants like Amazon Alexa and Google Home.
In the quick-service restaurant (QSR) world, Dunkin’ Donuts announced in August that is had rolled out voice ordering through Alexa. With the offering, customers can skip the line by placing orders using the retailer’s skill.
Dunkin’ is hardly alone in its efforts. According to the PYMNTS How We Will Pay report, voice-activated speakers have, in fact, become an important medium for commerce. As consumers make voice assistants a part of their shopping lives, retailers are tapping into the technology as a new sales channel.
Nearly three in 10 consumers — or 27 percent — own a voice-controlled assistant. In fact, the smart speaker installed base is expected to near the 100 million mark by the end of 2018 and represents close to 2.5 times the installed base at the end of last year. According to market research firm Canalys, the installed base will continue to grow, and will hit 225 million units by 2020. Leading the market will be the Amazon Echo, which Canalys predicts will have 50 percent of the installed base this year. Canalys also said that Google’s Home will account for 30 percent of the installed devices, while Apple’s HomePod will have just 4 percent of the market by the end of this year. Vincent Thielke, a research analyst for the firm, noted, “the U.S. is the world leader in smart speaker adoption. Amazon and Google know the power of an ecosystem lock-in and have been engaged in a fierce price war to try and build the largest installed base.”
And 28 percent of consumers who owned voice-activated speakers used them to make a purchase in the past seven days. Amazon Echo owners, in particular, are among Amazon’s most loyal customers and its most frequent shoppers. That’s according to data from equity securities research firm Consumer Intelligence Research Partners (CIRP), which noted owners of Amazon’s Echo smart speakers spend $1,700 on average each year on Amazon, higher than the $1,300 Amazon Prime customers spend annually. What’s more, the figure is 66 percent higher than the average spending rate of all Amazon customers around the globe. CIRP’s co-founder Josh Lowitz said in the report, “We’ve long thought that Amazon is keenly focused on building increasingly loyal and frequent shopping customers, and Echo seems to promote that goal.”
Six percent of voice assistant owners report making a purchase on their devices for event tickets. Google, for instance, announced a partnership with Fandango in May that allows users to purchase tickets through Google Assistant. Lilian Rincon, product management director of Google Assistant, said in a press release, “We worked with Fandango so you can buy tickets to the movies using your voice — just say ‘buy tickets’ once you’ve decided which movie to see. Or if you already have a movie in mind, you can just say ‘Hey Google, get me tickets for … ’ and insert the name of the movie you want to see.” Consumers can also use the feature to buy advance tickets for upcoming movies. According to The Verge, when using the prompts with Assistant on your phone, it pulls up a selection of theaters with available times.
Fourteen percent of voice assistant owners report making a purchase on their devices for groceries. In August, Amazon announced that Echo users can now use the smart speaker to shop at Whole Foods. According to Venture Beat, Alexa can now add Prime Now order items to a Whole Foods cart, with same-day delivery guaranteed within two hours. To use the service, customers can ask Alexa to add an item — for example, steak — to their cart. After each exchange, Alexa confirms what consumers added to their shopping list, then prompts users to order more items until they are finished. Alexa can even choose certain items based on a customer’s order history and purchasing behavior of other customers.
Eleven percent of voice assistant owners report making a purchase on their devices for food orders. Fazoli’s, the casual pizza restaurant chain, was testing the ability for customers to use Amazon’s Alexa to order meals earlier this year. In an interview with FastCasual in February, Fazoli’s CEO Carl Howard said the restaurant operator is testing the feature in some locations in partnership with Orderscape, an automation and voice technology software company. Orderscape currently offers automation ordering technology for Amazon’s Alexa, and plans to add Google Assistant and Google Home in the future, it was reported at the time. Howard told Fast Casual, “our investment was mainly the time of our team to collaborate with Orderscape and some small soft cost. The ordering availability is only available at select company locations while we work through all of the dynamics of this new technology.”
Beyond convenience, ordering through voice assistants can help bolster a company’s reward programs. The idea, according to Dunkin’ Vice President of Digital and Loyalty Marketing Stephanie Meltzer-Paul, is that the company is “always looking for ways to fit seamlessly into our guests’ daily routines and provide new levels of convenience and speed.”