Video: Voice is going to play a substantial role on Prime Day 2018
If you haven't heard already, which would mean you don't have Wi-Fi or a mobile device, Amazon Prime Day 2018 (APD 2018) is a week from today. And you will have no shortage of articles covering it from a variety of angles and perspectives leading up to the big day (and a half).
So, I might as well add my two cents to the mix as well.
Read also: When is Amazon Prime Day 2018? (CNET)
Now I'm not focusing on what the best deals are or all you need to know to make the most of APD 2018. You can find that pretty easily, with a great summary of that right here on ZDNet. I'll stick to my lane and focus on a few things I'll be looking for with respect to the role Alexa will play this year, and how what happens next week will set up the holiday season and beyond.
Overall Prime Day Growth: Can it keep up with last year?
One of my favorite things to do over the past few years is read the after holiday press releases from Amazon to get scoop on what took place. So I decided to go back and dig through press releases from Amazon -- with the results of the first Prime Day in 2015, up to the releases detailing results from 2017 holiday shopping season. And there was a bunch of interesting factoids in them, way too much to go into here. But, according to Amazon:
- Prime Day 2017 sales grew 60 percent year over year from 2016
- A record number of people joined Prime on Prime Day 2017
- Tens of millions of Prime members bought something on APD 2017 -- up 50 percent from APD 2016
- Echo Dot was the best-selling product from any manufacturer in any category across Amazon globally on APD 2017
- Prime members bought seven times more Echo devices globally APD 2017 than APD 2016
While they didn't give an actual number, estimates from a number of analyst firms and industry sites had sales from APD 2017 near the $1 billion mark, since estimates the year before were in the $600 million range. And, as great as that number is, it was surpassed by Cyber Monday 2017 as Amazon's biggest selling day ever.
That's a lot of growth and momentum going into next week, and a lot of expectations to live up to. It will be interesting to see if APD 2018 can grow at the same clip as in previous years and also top Cyber Monday 2017's single day sales record. It should definitely be bigger, as there are now over 100 million Prime members (up from the 80 million-ish this time last year), more countries participating (18 vs. 13 last year), more hours (36 vs. 30), and more hype.
There's also Whole Foods, which wasn't officially on board for APD 2017. However, by last year's Black Friday/Cyber Monday shopping weekend, the Echo Dot was the best-selling device at Whole Foods that weekend, according to Amazon. But, really, how many other devices are people buying in Whole Foods? Anyway, this year Whole Foods is definitely playing a role in Prime Day, so it will be interesting to see what kind of impact it will have on overall Prime Day sales.
And just as I was about to wrap this up, wondering if APD 2018 could do $1.6 billion and meet the 60 percent from last year, I literally see a headline that estimates a record $3.4 billion day. If that even comes close to happening, we are in for some interesting after shocks...
What Percentage of Sales Come Through Alexa?
As I recover from the $3.4 billion projection, I can't help but wonder what role voice shopping will play this year for Prime Day. Earlier this year, OC&C Strategy Consultants predicted voice shopping would hit $40 billion by 2022 in the US and UK -- up from $2 billion today. Now it's not often you see a twenty-bagger in four years' time in terms of sales growth. But if ever there was a showcase for why that number is legit, APD 2018 is it.
Last year, the Echo Show had just gone GA at the end of June, so not too many folks had them at the time. There was no Echo Spot. Amazon hadn't acquired Blink or Ring. So the breadth and depth of Amazon's Alexa-enabled device line has changed dramatically since APD 2017.
As all these additions to the device line rolled out over time, more interactions were taking place through them. So much so that Amazon's 2017 holiday results press release included a section for Amazon Devices and Alex for the first time, including stats like:
- Alexa customers set three-times as many timers this year compared to last holiday season
- Alexa customers turned on their holiday lights more than a million times via Alexa this holiday season
- Music listening time on Alexa was three-times as much this holiday season compared to last holiday season
- Alexa on Fire TV is more popular than ever before, with usage in the US up 889 percent over the same time period last year
Now, Alexa being used more than a million times to turn on the holiday lights is a pretty big number. So is the 889 percent increase in Fire TV popularity, and the three-times increases in other Alexa usage scenarios.. Although, since we don't have actual numbers, we don't really know how impressive (or not) those numbers are. But usage numbers are partly a function of how many devices are sold and being used. These numbers from the 2017 holiday season press release help shed some light on those number, like:
- The Echo Dot was the No. 1 selling Amazon Device, and the best-selling product from any manufacturer in any category across all of Amazon, with millions sold
- Millions of Prime members voice shopped with Alexa for gifts
- The most popular items purchased by voice were the Echo Dot, Fire TV Stick with Alexa Voice Remote, and TP-Link Smart Plug Mini
- Echo Spot, Echo Dot, and Echo Buttons all sold out
This latter group of numbers feel aligned with the thought that people are buying these devices at an impressive clip. And as they get comfortable with using these devices, they use them for a growing variety of reasons. I'm hoping APD 2018 will be the event where Amazon starts sharing some more details around not just around how many units of Amazon devices were sold, but what dollar amounts did voice shopping generate on the day.
Read also: What is Amazon Prime? (CNET)
It also would be cool to know percentage of Prime households own at least one Echo device, because, according to Consumer Intelligence Research Partners (CIRP) LLC, Echo owners spend approximately $400 a year more than Prime members ($1,700 vs $1,300). Based on the above bullet points, there's a pretty good chunk of Prime members using Alexa to buy Echo devices, but I'm guessing they're buying other stuff, too.
Also, what percentage of overall sales came via voice shopping would be nice to know. I know I'm dreaming a bit here, because I really don't expect to get those numbers, but it doesn't hurt to ask, does it? At least give us one of those two-times or three-times numbers to let us know if voice sales as a percentage of overall sales increased dramatically, or significantly, or at all. I know I'd appreciate it, and I'm guessing those estimating the voice shopping sales numbers will too, as Amazon will no doubt be leading that as well, as it does online shopping in the US.
I could go on, but it may be easier to check out the embedded video above as I discuss this with my Watching Amazon partner and eCommerce expert John Lawson.
Small Businesses and Voice Shopping?
According to Amazon's Small Business Impact Report, released in May of this year, more than a million US-based small businesses are selling on Amazon, with more than 20,000 SMBs worldwide doing more than one million in sales last year. And Prime Day 2017 was "another record-breaking success" for SMBs worldwide, according to a company press release. But with all the focus on this year's Prime Day, I'd love to see more specifics around how much are SMBs selling -- and how much of those sales are coming via voice shopping.
OK. I know I'm really asking for a lot, but I'm also really curious about how much small businesses are participating in Prime Day, especially via Alexa and voice shopping. This just came to mind because I got an email from the Amazon Alexa Team about a live Twitch Stream for this Thursday regarding teaching people how to "design, build, and launch rich, conversational skills that deliver customer value and drive habitual use."
I'm not expecting to see much of any of what I'm asking for in the Prime Day 2018 aftermath press release. But it feels like there's so much riding on this one day. Something that three years ago people didn't take seriously. Three years ago most of us barely knew what an Echo device was or who Alexa is. And now, three years later, a day when expectations are anywhere from $1.6 billion to -- gulp -- $3.4 billion of sales.
But, for me, whatever that top number is, I think the most interesting piece will be how much of it will come from people asking Alexa to buy something. And how many different types of things they ask her to buy. And how many of those things they ask her to buy for them are being sold by those third-party sellers. That may give us an idea of just how big this voice-first economy will be going into the 2018 holiday season and beyond.
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