Voice shopping is going to change retail in ways you don’t expect

The Australian retail sector is entering an era of unprecedented change. Not just online retail, all retail, and it’s going to have major impact on brands. Artificial intelligence (AI) is changing the way people shop for products, but it may be in a way you don’t expect – through conversation. Here’s how.

AI is human-like intelligence, learning and evolving with the information presented to it in real time. And the most human way to communicate is through conversation. Smart speakers such as Google Home or Amazon Echo are commonplace in US homes. It’s reported that one in every two households owns a voice-enabled smart speaker. Forty-four per cent of them use it every day.

In Australia, a recent study by Sensis indicated that about 24 per cent of Australian households have a smart speaker. This technology is proliferating and becoming mainstream, thanks to its convenience.

Hey Alexa, order me another bag of cat food

Think about what this means for brands (and retailers). Who chooses which brand gets recommended? Not Coles, not Woolworths, not you. It will be Amazon or Google. That’s a major change.

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In the US, 55 per cent of people now begin an online product search on Amazon, and 64 per cent of households are Amazon Prime subscribers. Amazon has effectively jumped in front of Google when it comes to retail shopping online.

While search has long been the default starting point for the customer journey online, voice devices are quickly becoming the interface for conversational commerce by getting one step closer
to the customer. Conversation is the new customer interface, and as Nike recently proclaimed, “the interface is the brand”.

If your brand is not being recommended by Google Home or Amazon Alexa, it will be invisible to customers using smart speakers, unless they ask for your brand by name.

Ratings and reviews really matter now

Once again, brand (name) recall needs to be high on your priority list. And in a world of content marketing where we have moved away from overt product mentions, this will pose a challenge.

Phonetic pronunciation will become a key consideration in the selection of new product and brand names, as opposed to the current trend of abbreviated text. A whole new set of considerations come into play.

Ratings and reviews will influence your position in the recommendation engine, and Australian marketers haven’t fully woken up to how important consumer reviews are in rankings yet.

For those managing a whole portfolio of products, have you made your product information fully available to voice-based search indexes, crawlers and robots? In a way that will make sense
in a conversation? Has your business developed a voice strategy to ensure you show up when consumers are inquiring?

Service brands have been quick to jump into voice, as their strategy is reasonably straightforward – it’s simply another channel. Order an Uber, organise a flower delivery via 1-800-Flowers,
get a pizza delivered by Dominos, buy tickets from Ticketmaster, make a reservation with Dimmi.

Starting a knife fight at the mall

For consumer product and retail brands, the strategy requires you to look beyond your product. You need to find ways that you can add value to your customers in a space that your brand has
credibility play.

For example, Tide, a washing powder brand in the US, has an app that advises you on how to remove specific stains. Patron Tequila has an app to help you explore and make cocktails. Brand owners need to find ways to explore the content around their product, not about their product.

There’s no doubt conversational commerce is posing many new challenges in an already complex world. Retailing was already a tough fight! But it’s not only a fight in the home.

Geo-conquesting, the practice of proactively pitching retail offers to customers’ mobile devices as they enter a competitor’s store, promises to create a knife fight in the shopping centre.

By adding the competitive intelligence of your previous browsing and search behaviour, you can be sure those offers will be hyper-targeted and relevant. And, with home delivery as
the sweetener, compelling.

Only brands that have access to the customer interface can do that. And that’s how you will make your brand matter in the era of conversational commerce.

Jason Davey is head of digital at Ogilvy Australia.

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