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Digital home assistants: Are marketers listening closely?

Digital home assistants (DHAs) – such as Amazon Echo, Echo Dot, and Google Home – have made great strides in a short amount of time.  Just two years after the Amazon Echo launch, slightly more than one in ten (11%) US households own a DHA, according to the latest findings from GfK’s The Home Technology Monitor.

The right product at the right time

This seems to be a case of the right product at the right time.  With the advent of Siri and Cortana, consumers are becoming increasingly comfortable with using their voices to control devices.  Our research shows that three-quarters of all US consumers have used speech to operate some sort of digital device – be it a smartphone or a smart TV.

Despite the progress DHAs have made, though, their adoption level is still lower than tablets and DVD players at the same point in the same time “in market”. To tap DHAs’ full potential for market growth, marketers need to address two key issues:

  • Compatibility and seamlessness of working with other devices
  • Privacy and security

The rebound in the housing market also has the potential to fuel DHA adoption.  GfK’s Consumer Life research, as reported in Tech Trends 2017, shows that Millennials represent just over one-half (53%) of those who plan to buy a home in the next two to three years – and they are also key to smart home adoption.  DHAs show potential as a controller device to save energy, keep their home safe and secure, and maintain a healthy living environment.

How consumers are using DHA’s now

We can gain great insights on how to unlock DHAs’ potential by looking at the ways consumers are using them now.  For example, nearly two thirds of DHA owners (63%) use them to play music.  By contrast, only 15% turn to them to play videos, watch TV, or movies – even though nearly one-half (43%) of US homes have an Internet-connected TV that they use to watch TV and movies.  This disconnect begs the question: What is holding consumers back from riding the video wave with their DHAs?

The answer is clear: A lack of seamlessness!

Currently, Google Home has built-in compatibility with Google’s Chromecast; however, Amazon Echo (which accounts for 10 out of every 11 DHAs owned) and Dot are not easily connected with smart TVs.  To make these devices talk to each other, users need to connect through a hub such as Samsung’s Smartthings or Logitech’s Harmony hub.  These are extra steps that the mass market may not take kindly to.

At the 2017 CES, some TV manufacturers announced FireTV with Alexa built into their next generation TVs.  This development promises little to no set-up and a more seamless experience.

DHAs show promise with other smart home use cases, with nearly one-fourth (23%) of DHA owners indicating that they use the devices to control their home lighting, thermostats, fans or security systems.  Manufacturers’ great progress in making their home products IoT-ready is starting to pay off!  The 2017 CES was rife with products featuring Alexa built-in, ranging from refrigerators to lighting to robots.

Choosing the right standard for DHA’s

A related compatibility question consumers are asking themselves is, “Which DHA should I hitch my wagon to?”  If I’m an Apple or Samsung lover, should I hold out for Siri or Bixby – or do I go with the first thing that works?  When a new technology comes out, choosing the right standard is really critical; no one wants to buy the next Betamax. You want to own the device that will speak to the largest number of other devices.

Marketers also need to address some important privacy and security challenges. For example:

  • How long does a DHA keep voice recordings?
  • How does it protect the confidentiality of the owner and separate personally identifiable information (PII) from behaviors?
  • How can owners prevent the sharing of data to 3rd parties despite the potential commercial reward?
  • How do we protect the security of customers’ financial data?

When exploring pain points, consumers in the GfK study expressed concerns about the possibility of hacks on their personal data.  It will only take one or two more DHA privacy stories in the news to turn this into a real impediment to uptake.

As we run headlong into this Brave New World controlled by DHAs powered by artificial intelligence, marketers have great responsibility to help guide standards that will make for a seamless, life-improving and safe experience.

Rob Barrish is a Global Account Director at GfK.  To share your thoughts, please email rob.barrish@gfk.com.

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