In what feels like the blink of an eye — and pushed by the breakout success of Amazon’s Echo line of smart speaker products — the idea of regularly interacting with a voice-controlled virtual assistant has gone from being the stuff of science fiction and summer blockbusters to an increasingly everyday part of consumers’ regular commerce process.
By the numbers, it’s still early days — most estimates for the number of smart speakers in the U.S. market by the end of 2017 were between 25 million and 30 million — but that figure is expected to grow, and fast. By the end of 2022, five years from now, analysts expect there will be 175 million or so smart speaker devices in the U.S. marketplace in 70 million (55 percent of) households nationwide.
Such wide penetration will mean big changes and big potential for innovations, particularly for payments and commerce players who can find new and better ways to open up opportunities for users once they say, “Alexa…” (or, perhaps someday, “Hello, Google” or “Hey, Siri.”)
“I see a lot of opportunity here, just in terms of how comfortable people are in talking with voice-controlled AI. I think it is a virtuous cycle — the more comfortable people get with it, the more skills and services are added, which then attracts additional users. This is now a space that is ripe for disruption with a lot of opportunities for financial services and technology firms,” PSCU’s VP of Digital Solutions and Innovation, Priya Dozier told PYMNTS in a recent conversation.
And it’s an opportunity that PSCU — the nation’s leading credit union service organization — is eager to explore actively on behalf of its Owner credit unions. It’s why PSCU is participating in the PYMNTS Voice Challenge with Amazon Alexa in 2018, building off work done earlier this year with students at the University of South Florida.
Overcoming Member Reluctance
While consumers are getting increasingly interested and comfortable with the voice-activated future, Dozier told PYMNTS, research PSCU did in early 2017 strongly indicated their Owner credit unions were still looking at the technology a bit skeptically. After doing some preliminary work in the topic of biometrics and financial services, Dozier and PSCU’s Innovation team decided to take a deeper dive into voice technology to learn how it works and how well it would play with the existing infrastructure PSCU had in place. This led to a partnership with the University of South Florida, in which a group of students were given access to a speaking system in order to develop use cases with those devices.
“That is what really drew our interest into the PYMNTS 2018 Voice Challenge with Alexa — because we wanted to take the insight we gained this summer and move it a step further,” Dozier said.
The PYMNTS 2018 Voice Challenge with Alexa will see innovative teams turned loose on Amazon’s virtual assistant, tasked with developing and executing a prototype using Alexa, Amazon’s virtual assistant, to solve problems, remove points of friction and add value to the payments and commerce ecosystem.
A heavy lift, to be sure, but, Dozier said, in line with a lot of work PSCU has been doing for some time in the digital age.
A New Channel Is Born …
While the entrance of Alexa into the market will mean an awful lot of change and experimentation, Dozier noted, the emergence of the voice channel is the next iteration of the digital channels that PSCU already owns and operates on behalf of delivering services to its Owners.
“We currently provide service solutions in the mobile, web and call center channels, so the voice experience could be an extension as members become more comfortable.”
There are, she noted, still large unknowns and puzzles to be taken into account. Authentication is of primary importance, particularly to the credit unions it represents — and that is an area where progress is still most charitably described as “underway.”
“There are valid concerns about authentication across the board, and so far, there is no silver bullet solution. The market is a bit immature in terms of what we can tap into to resolve authentication issues.”
Biometric voice authentication, she said, very possibly has a big role to play in the future, but right now, when it comes to layering primary services on top of the voice channel, it is still in an exploratory phase.
“As such, the PSCU Innovation team is exploring the voice channel to determine how it might impact our existing products, solutions and member experiences. Beyond confirming our integration options could work in the voice channel, we are not offering any specific services yet.”
More broadly, Dozier isn’t just interested in building for the voice space as a standalone, but considers it as one of many channels through which members of their Owners credit unions may pass.
As new channels open up, Dozier said, the temptation is to get tightly locked into specific capacities of that channel — to the exclusion of the other digital channels already in operation. That, she noted, is a misstep, because customers are increasingly multichannel. Members today will try to access their credit union on a variety of channels.
“For us, it is important that we maintain a consistent member experience as our members navigate across channels.”
The goal, she said, is for members to have fewer friction-filled experiences where they feel like they are in a never-ending loop of answering the same questions, repeating the same passwords and corralling the same data over and over again. The goal, she said, isn’t just to solve for authentication in one channel, but to solve for it between all channels. Consumers want a holistic experience instead of one that feels awkward and fragmented.
Credit unions, she said, are unique in many ways when compared to the larger financial services firms, particularly in how they relate to their customers, whom they consistently call members. But, Dozier noted, in many ways they want a lot of the same things the big guys want: for their cards to be top of wallet and to reach their members where they choose to transact or receive service.
“Our members want a seamless experience, and we want to make sure we are there for them the first time they ask for Alexa’s help.”