Ears wide open

Illustration Voice technology is hot.

Just ask Alexa…or Siri…or Google Assistant…or Cortana…or BixThere’s something primal about listening to entertainment. Think of cave dwellers huddled around a fire pit enraptured The first voice, or virtual, assistant was Apple’s Siri, which was embedded into the iPhone in 2011. Siri proved to be remarkably efficient at retrieving information for users and executing basic tasks (“Siri, call Mom.”). Amazon’s 2014 introduction of the Echo smart speaker and its compliant Alexa assistant provided a new pipeline for voice into millions of homes. Google and Microsoft have followed suit with their own voice assistants and speakers, and audio component specialists such as Sonos, JBL, and Harman Kardon have developed similarly intelligent speakers. Beyond delivering content, these devices and their associated technology have created a new platform for enabling communication and, ultimately, commerce.

The adoption curve for smart speakers in the U.S. has been remarkably steep. By the end of 2018, according to research firm Voicebot.ai, 66.4 million U.S. adults (representing 26.2 percent of the total number) owned smart speakers, up 40 percent from 2017. In 2018, according to PwC’s Global Entertainment Media Outlook, 88 million smart speakers were in use in 20 key markets. That number is expected to rise at a 38.1 percent CAGR through 2023, when 440 milllion units are expected to be installed in those markets. In the U.S., Amazon Echo maintains a 61 percent market share, though Google Home is closing the gap, with a 24 percent stake, according to Voicebot.ai.

But voice tech doesn’t just mean delivering weather updates or playing music on demand. Fortified Voice tech’s arrival represents an important evolutionary step in user convenience. With computers, typed text originally was the primary input. Then came mouse clicking, followed

In the media world, advertising tends to follow attention and consumer behavior; advertising and commerce grow in parallel on new platforms and in new channels. There are signs that a similar pattern is beginning to happen with voice. For now, only a small number of consumers are willing to v-shop for commodities such as pet food, toilet paper, and laundry detergent. Indeed, in 2018 v-commerce accounted for just 0.4 percent of digital sales, or US$2.1 billion, according to eMarketer.

But voice devices are poised to become an important new marketing platform. Global advertising on voice devices, practically nil today, is predicted to rise to $19 billion Global advertising on voice devices, practically nil today, is predicted to rise to $19 billion Marketers are preparing for the voice revolution with limited sorties, not all-out assaults. They are largely emphasizing providing information about branded products and services — content consumers are conditioned to seek via online searches — and stopping short of urging the user to make a purchase. For example, a father might ask Alexa for the ingredients in Oreos because he’s worried his son might be allergic to some of them. This strategy uses tried-and-true principles of search engine optimization (SEO), but applies them to voice commands rather than typing, highlighting a unique attraction of voice tech. “The SEO is based on how humans actually speak,” Sean Corcoran, executive director at Boston-based MullenLowe Mediahub, told AdExchanger in 2019.

Many brands are working with agencies and voice tech developers to custom-build branded skills, the newly coined term for audio-only versions of mobile apps. They’re activated V-commerce is following hard on the heels of podcasting, whose already impressive rise is likely to be boosted further Moves The growth of podcasting has proved that in an age of constant distraction, there is a yearning for immersive long-form content that people can access and absorb in places in which it is either inadvisable or illegal to watch video: during commutes, in the car, while exercising, at work. So perhaps it is not surprising that one of the original forms of portable long-form voice content — the audiobook — is likewise thriving.

Audiobooks have historically been a small slice of the overall book market. But in recent years, they have emerged as a robust niche. In February 2019, the Association of American Publishers’ StatShot reported an impressive 37.1 percent jump in downloaded audiobook sales in 2018, to $469.3 million from $342.2 million in 2017. This, in a year when overall trade book sales in the U.S. rose just 4.6 percent. To be sure, revenue from electronic books was more than double that of audiobooks in 2018, at $1.05 billion. But those e-book sales declined Given the continuing collapse of the retail channel for physical books, some of the most prolific and best-selling authors are eschewing print and embracing audio for their upcoming projects. Malcolm Gladwell, author of a number of nonfiction books that have sold phenomenally well, recently formed his own podcasting company, Pushkin Enterprises, to pursue new projects. In June 2018, Michael Lewis (author of, among other books, Moneyball, The Blind Side, and The Big Short) signed a multiyear contract with Audible, Amazon’s audiobook business, to create four original audio-only stories. The deal actually sidestepped Lewis’s plan to sample his next book as a 10,000-word piece for Vanity Fair. “You’re not going to be able to read it,” he told the New York Times. “You’re only going to be able to listen to it.”

As the infrastructure surrounding all things voice — devices, virtual assistants, v-commerce, podcasts, audiobooks — continues to grow, the suite of services and the large sponsors that enable those businesses to thrive will also get bigger. Participants in the vast and continually changing entertainment and media industries need to keep their eyes and ears wide open for opportunities.

PwC Global Entertainment Media Outlook 2019–2023: A comprehensive source of advertising and consumer spending data available on June 5, 2019.