Voice Commerce

Voice commerce is the functionality of voice assistants to execute purchasing transactions via voice commands from their users. Voice commerce takes place through voice-enabled devices like smartphones, smart speakers, and smart home devices. State-of-the-art AI algorithms that enable language understanding power this emerging trend in e-commerce.

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What does Voice Commerce mean?

The big-tech players have made a big bet on developing technology in ways that become intertwined with our daily actions. Big steps in this direction are getting rid of the need to hold a gadget in the hand, to look at a screen or to type a request. Using voice as means of exchange promises great potential for companies. Having conversations is usually reserved for humans. Any interaction that successfully resembles human conversations is bathed with familiarity.

Voice commerce uses AI-powered voice recognition and understanding capabilities to assist users throughout the customer journey. Voice assistants like Apple’s Siri, Amazon’s Alexa, or Google Assistant guide users in searching, comparing, and purchasing items. The interactions between users and technological devices take place through voice-enabled gadgets. Devices for voice commerce include intelligent speakers (Amazon Echo, Google Nest), smartphones, smart TVs, IoT devices, and even cars.

The total value worldwide of smart home payment transactions made via voice assistants is expected to go from 22 billion US dollars in 2020 to 164 billion US dollars in 2025.

Bergur Thormundsson

Is voice commerce the same as conversational commerce? Not exactly. Voice commerce limits to purchases made through interactions with voice assistants through voice-enabled devices. Conversational commerce is a broader concept encompassing conversational interactions through voice assistants, apps, and chatbots.

The story of voice recognition started in 1961 with Shoebox. Shoebox was a voice recognition system created by IBM engineer William C. Dersch. Shoebox could recognize 16 spoken words and was employed to solve math problems. Apple revolutionized the market with its launch of Siri in 2011. Android followed the lead by deploying its voice assistant in 2012. Amazon’s Alexa appeared in 2014 after the company developed it from a Polish system, Ivonna, that they bought in 2013.

Voice Commerce definition
Voice commerce is a specific form of voice search in which the customer uses voice commands to interact with a voice-enabled device (smartphone, tablet, smart speaker, smart home devices) throughout the purchasing process. Voice commerce is powered by various AI algorithms that allow voice assistants to interpret what users mean and act accordingly.
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AI technology powering Voice Commerce

Natural Language Understanding (NLU)

Natural Language Understanding is a subfield of NLP that extracts useful information from human language. Deep Neural Networks are used to extract information from speech, even with background noise and different accents.

Intent Prediction

AI algorithms are being developed to predict purchase intention in voice commerce, understanding triggers and context that motivate users to buy. Data from voice interactions improves intent prediction models.

Voice Biometrics

Security is a crucial concern in voice commerce. The advancements in authentication processes through voice recognition are essential for users to develop trust in voice commerce.

AI Text-to-Speech

Voice commerce AI algorithms have complex conversations, aimed at being natural and fluid for the user. Recording text snippets is no longer feasible. Exciting developments in artificial voice in different languages, tones, emotional cues and dialects.

What challenges does Voice Commerce face?

  • Privacy concerns

    As with other items related to IoT, users have developed mistrust in the usage of data gathered by their voice-enabling devices. For widespread adoption to be possible, companies must ensure data protection for their customers and communication based on transparency and responsibility. Governments can also act as significant players in protecting their citizens’ data (e.g., the EU’s General Data Protection Regulation that came into effect in 2018).

  • Lack of trust

    Voice commerce is still a technology used mainly by early adopters. One of the key reasons why it has not achieved mainstream acceptance is that users don’t trust the system. Currently, most users prefer to use voice commerce when re-ordering a product they have already bought in the past or buying small and inexpensive items. Customers must develop confidence in voice commerce for more complex orders.

  • Technological Complexity

    For smaller retailers it is still unclear how to profit from voice commerce. A successful strategy for vendors to benefit from voice commerce is to invest in good SEO strategies. Voice search is switching the focus from keyword search to search in the form of questions. Ensuring all their online presences are informative and answer relevant users’ queries will be beneficial. Moreover, companies can implement voice interfaces to communicate with their customers.