Hey Alexa, what’s the square root of 2?
Besides digital assistants telling jokes and playing songs, it is unclear how much of the shopping process these voice-activated devices will assume.
Digital assistants – also called DAs or smart speakers when encased within same – are probably one of the most useful inventions of the past couple of years. The first famous DA was Apple’s Siri. Then came Amazon’s Alexa. Most recently Google Home has grabbed some share, utilizing Google Assistant, and Microsoft’s Cortana-infused Invoke is brand new.
The question is: Will there be a single winner that will become the reference standard (think VHS vs. Beta), or will there be a multitude of independent platforms all pulling information from different sources and vying for market share?
Perhaps the answer is that it will boil down to just a few winners.
How Digital Assistants Are Used
The first milestone that has helped propel DAs into common usage is that voice recognition has become quite accurate. Artificial intelligence has dramatically improved voice-to-text capability.
Microsoft’s Cortana platform also has recently released a particularly accurate translation engine that will let the user search and interact with websites/e-commerce platforms from almost any country. Clearly there will be a time when we can get along well in a foreign land without the aid of a translator – just hold up your phone and talk.
When Siri was first launched, people used it to adjust their phone (“Siri make my screen brighter”), tell jokes, and play songs on demand. But Siri usage didn’t really get any more creative than that.
The main reason for its limited use cases is due to the data it was sourcing and how that data was being presented. Specific functionality across all possible use-case scenarios is key to how the three major DAs are vying for user share (with Microsoft the newbie fourth). Here is a YouTube video that compares the three.
Although Alexa can answer any question whose answer can be found on the Internet, the main user-focus is on shopping. About a year ago Amazon launched Amazon’s Choice – a moniker that can be found on specific items across a large number of categories and subcategories. The main purpose for the Amazon’s Choice program is to give Alexa a single SKU to surface if the user does not specify a particular brand or model. In other words, if you just say, “Alexa I need double-A batteries,” and do not say Duracell batteries, Alexa will default to the Amazon’s Choice SKU – which of course is their private-label Amazon Basics brand.
Amazon now offers a host of Alexa-fueled Echo smart speakers, including the larger Amazon Echo, which is a Bluetooth-enabled powered speaker that has reasonable fidelity. They also have the smaller Echo Dot, which can be placed in additional rooms or even go on the road for those who cannot live without it.
Google has come hard after Amazon with three models – Google Home, Mini and Max. While the overall Google Shopping experience is not quite as convenient as Amazon’s (there is no single payment or shipping system), the search engine is terrific and Google delivers probably the best experience in terms of search results.
Recently, both Apple and Amazon have announced that they will use the Google search engine to power their backend as well. So it will be interesting to see how the two companies continue to differentiate their products from one another.
Last May Microsoft announced a partnership with Harman Kardon to release the Invoke – which is Microsoft’s foray into this hot new technology.
Also, at the end of August, Microsoft and Amazon announced that they are partnering to integrate their Alexa and Cortana digital assistants. Alexa users will be able to access Cortana, and vice versa over a range of devices. All the user has to say is “Alexa open Cortana,” or the other way around, and one system can use the other.
This of course adds an element of complexity to the whole DA scene, and makes one wonder how this will all play out. Will everyone live in harmony or will there be a DA war – a sort of smart speaker net neutrality apocalypse – where Alexa will say “Don’t listen to that Google gal, she doesn’t know what the heck she’s talking about!” We doubt it, but let’s revisit this paranoid theory in a year or two.
How CE Dealers Can Get Into The Game
As an electronics retailer, you have a couple of ways to take advantage of this technology. One way is to simply sell the devices. Best Buy carries Google Home devices. Amazon, not surprisingly, does not. But Best Buy also sells Alexa devices, as well as the Cortana Invoke.
The other way to get into the game is to be one of the search results for DA users. This won’t happen with Alexa unless you are an Amazon seller, but even then Amazon will try and default to selling its own products. Also, large CE purchases are probably best not done on Alexa. (“Alexa buy me a 55-inch 4K Ultra TV” – hard to imagine that happening anytime soon, but who knows?)
But if you want to rise to the top of Google Home or Cortana, you will have to also rise to the top of Google and Bing, since the results are simply expressed verbally from the search results.
Even though these smart speakers are self-contained units, the real application for this voice-connected Internet technology is ubiquitous. The future is for these DAs to simply be modules inside other IoT devices such as your standard entertainment system, lighting, TVs, refrigerators and so forth.
In other words, it is not very clear how much future the actual hardware will have.
Noah Herschman is a Microsoft retail industry senior architect with over 30 years’ experience in CE retail, including stints at Tweeter, Amazon, Staples China, eBay, DHgate and Groupon Goods Asia. His partner ShiSh Shridhar has worked at Microsoft for more than 20 years, currently as retail industry lead for data and analytics. Together they are creating technical solutions that are sophisticated in design and specifically targeted to improve businesses by engaging customers, empowering employees, optimizing operations and transforming products.