• The Smart Home
  • AI
  • Alexa
  • IoT

Missed Opportunity: Consumer Underutilization of Smart Speakers

Benjamin Schefrin
Jul 17, 2019

Smart Home

Smart speakers are becoming more ubiquitous in society. National Public Radio and Edison Research’s spring 2019 Smart Audio Report covers trends among owners and non-owners of smart speakers. The survey finds that a little over 20% of Americans 18 and older now own a smart speaker. This follows the general trend of the increasing number of smart devices within residential homes, as reflected in Guidehouse Research’s report, The Smart Home Overview. The report anticipates smart speakers will rise at a compound annual growth rate of 18.4% between 2018 and 2020.

While the number of households that own a smart speaker is growing, there are strong indications that consumers are not reaping the full benefits of owning a smart speaker. This represents a failure of firms to adequately inform consumers of the services that are available to them.

Consumers Unaware of All Abilities

Smart speakers are convenient for consumers—they are hands-free and have internet access available for whatever queries a user might think of. However, consumers seem to be unaware of many of the applications that their smart speakers can provide for them. According to the survey, those that have owned smart speakers for less than 3 months use an average of 11.7 skills per week. Those that have owned a smart speaker for more than 2 years use an average of seven skills per week. People that use a smart speaker to control a household device use an average of 16 skills per week

The tasks most often used by owners are relatively simple, such as playing music, asking about the weather, or answering a general question. According to the survey, 69% of owners agree that they do not know enough about their smart speakers to use all its features. That is not to say that there is a shortage of tasks or applications that exist for consumers. Amazon’s Alexa has roughly 80,000 different skills available.

What Can Application and Task Makers Do?

So how can companies that create applications for smart speakers better reach consumers? Part of the issue is how smart speaker owners learn about the new capabilities of their smart speakers. Only 18% of smart speaker owners found a skill or action through a company advertisement. Word of mouth from friends or family is the number one way that owners realize new abilities of their smart speakers, while alerts from the smart speaker brand is second-most common.

This strongly suggests that companies creating content for smart speakers are failing to get their products noticed by consumers, despite making useful applications for people’s lives. Google and Amazon do not feature advertisements for their devices, so it is up to companies to get applications noticed by consumers.

One vector to inform customers that an application exists would be through existing advertisements with a possible tagline of, “find our app for Google Home/Alexa/etc.” Other possibilities include companies that make hard goods advertising their smart speaker application on packaging. Companies that provide services can inform customers about their smart speaker application when their product is registered. Some companies have made interactive applications to connect with consumers.

First Come First Serve

Smart speakers represent a new method for companies to reach millions of consumers. Companies that do not have a smart speaker application should consider creating one, while companies with a smart speaker application should bring greater awareness of their application to consumers. Companies that demonstrate value in their smart speaker application early will have a competitive advantage over rivals, making it a venture worth pursuing.