Voice recognition technology has been around for decades. But with more consumers using voice-powered devices in their homes, the ultimate convenience of voice commerce is starting to become apparent.
In theory, voice commerce already has the qualities that payments innovations strive to achieve. First, it’s truly contactless because the consumer would only need their voice to confirm and complete orders - no need to touch a screen or insert a credit card.
Second, it’s frictionless, as a voice-powered device would already have payment details on file once a consumer is ready to finish a transaction.
Here’s what ISVs should know about the current state of voice commerce and what the future might be.
Defining voice commerce
For voice commerce to work, a consumer would need a voice-enabled device and an internet connection. The device must have the ability to understand voice commands and, in turn, communicate with search engines to find information and begin the payment process.
While they may appear similar in meaning, “conversational commerce” and “voice commerce” are not exactly interchangeable. It’s worth clarifying that voice commerce is considered one type of conversational commerce.
Chris Messina, a product designer, first coined the term “conversational commerce” in 2015. At the time, he predicted that “concierge-style services may become the primary way in which people transact on their mobile devices.” Additionally, he believed “conversational commerce is about delivering convenience, personalization, and decision support while people are on the go.” It won’t matter where the customer is: as long as they have internet access, brands can bring them to the point of sale through mediums like messaging apps or smart speakers.
Now, conversational commerce encompasses how a brand can use text and voice communication to assist customers and make sales. Brands can leverage AI technology or live service representatives to connect with customers and offer personalized interactions at each touchpoint.
Conversational commerce can look different depending on the medium. Examples include:
- Messaging apps (such as Facebook Messenger) with a live chat agent
- Voice assistants (like an Amazon Echo) with Alexa
- A chat window on an ecommerce website with a chatbot
- SMS messages that send pay-by-link texts through phone intelligence software
Voice commerce statistics
The future sounds positive for voice shopping. According to Juniper Research:
- The voice commerce market will land around $80 billion in 2023.
- 34% of shoppers aged 18-29 report purchasing with a voice-activated device at least once.
Additionally, a PYMNTS research study found that 26% of consumers own a device with a voice-controlled assistant. A separate PYMNTS study showed that consumers made 14% of all voice-assisted purchases while doing household activities such as dishwashing, cleaning, watching TV, and cooking, indicating that convenience plays a large part in adoption.
Voice commerce trends
If the above statistics aren’t enough to convince you that voice commerce will be around for some time, perhaps the following trends may prove to be persuasive.
Millennials and younger generations will drive voice commerce adoption
A PYMNTS survey found that bridge millennials are almost twice as likely as the average consumer to use voice-activated technology to make purchases.
Younger generations have grown up with digital assistants and voice technology. As Gen Z shoppers come of age and get ready to make purchases, they are more likely to use newer shopping channels such as voice and other connected commerce experiences.
Voice recognition technology will continue improving
Voice assistants can still be limited in understanding voice commands from humans. Artificial intelligence technology companies and major tech firms continue to work on natural language processing (NLP), which gives computers the ability to understand text and spoken words the way humans do.
It’s also worth noting that English is the language that is the most developed and accurately recognized in voice technology. By also focusing on expanding to other languages, there is hope that voice recognition will be more accurate and inclusive in the future.
More voice assistants will be implemented outside the home
Different use cases for voice assistants are beginning to emerge.
One example is connected cars. Drivers who use Android Auto will soon be able to pay for gas with a simple voice command at more than 32,500 fuel stations across the United States. Additionally, Business2Community reports that “carmakers like BMW and Ford are partnering with Amazon to build Alexa voice integrations directly into their cars,” allowing drivers to talk to the assistants while driving.
Business2Community also mentions select Marriott hotels have Alexa for Hospitality, allowing guests to order room service through voice commands. In the future, it may even be possible for guests to order forgotten items like makeup through these hotel voice devices and have them delivered to their rooms.
Food, beverage, and retail brands will invest in voice ordering on their apps
Quick-service restaurant chains and big-box retailers are continuing their efforts to integrate voice ordering, either within their proprietary mobile apps or through an external voice assistant.
According to PYMNTS, Domino’s, KFC, Pizza Hut, and Wingstop offer some form of voice ordering, while Wendy’s hinted that their new app may have voice-activated integrations. Walmart has a partnership with Google that allows customers to order groceries with a branded voice command. Also, Amazon has a voice integration that lets customers order groceries at AmazonFresh through any Alexa-enabled device.
The benefits of voice commerce
Merchants that choose to maintain a voice channel can gain an additional way for customers to enable commerce with their brand. They can also attract new customers who are active voice shoppers.
Customers may also see voice shopping as an easier way to transact with merchants. Voice commerce can be quicker, as customers can say their order faster than they can type it. The hands-free nature allows customers to make orders on the go.
Keywords for voice shopping differ from keywords for text. Since voice commerce is still emerging, brands that come in early benefit from optimizing their listings quicker, which can lead to a boost in voice search rankings.
The challenges of voice commerce
As noted earlier, English is the dominant language understood in voice recognition technology. Unfortunately, this means merchants may not reach their customers who cannot speak English through voice commerce.
While there is substantial growth in voice commerce, it can still take more customers to get used to it. Some may perceive digital assistants as hard to use or the “robotic” sounding interactions as less “human.”
Lastly, customers may be comfortable voice shopping for small, recurring orders. However, some have expressed uncertainty whether voice assistants can get larger, complex orders right the first time.
Connected commerce is the future
Innovations in voice commerce are making retail and ecommerce an exciting space to watch. Improvements in voice recognition technology can have customers transact with merchants outside of traditional contexts.
At Global Payments Integrated, we will continue to monitor the voice commerce landscape and share our insights with ISVs as it happens. Subscribe to our blog today to stay informed on voice commerce and other payments-related innovations.