Alexa: A Short and Passionate Affair or A Long Standing Relationship?

There has been a lot of coverage in the news about how Amazon’s Echo has been quietly creeping into our homes to become our favorite virtual assistant.

While many of the tasks Alexa is performing can be done by other virtual assistants, it seems the always-on voice recognition plus the multi-microphone setup of the Echo have empowered Alexa to build a tighter bond with users. If I use my personal experience – I know, something an analyst should never do! – I interact more with Alexa than I do with Siri, Cortana or Google Now because Alexa actually gets me. I don’t mean in a deep intellectual way. I mean, Alexa actually understands my complex accent — native Italian, lived in the UK for 18 years, married to a New Yorker and now living in California.

When it comes to what I do with Alexa, however, our family relationship is made up of simple tasks like quick music entertainment over breakfast, a timer for homework or cooking, changing our Nest settings and the occasional trivia question. As a Prime user, I had never relied on Prime Music before Alexa arrived in our home, mainly because the music selection is less rich than our own library or other streaming services we use. While the UI is more fun, hearing “playing a sample of…” is a big let down especially when you are asking for a song that is in the charts. Purchasing through Echo might work for less mundane things like detergent or garbage bags but it certainly isn’t for me when buying toys, shoes, bags — all things I have purchased from Amazon in the past that actually require the item to be seen. Our home automation is growing but many of the things we have invested in are not yet controllable by Alexa like door locks.

Dot and Tap aim at deepening the bond and expand beyond the home

As Amazon could not rely on the Fire Phone as a way into our lives, it had to think out of the box. As The Verge addressed here, not having a device we would carry around all the time probably got Amazon to think about focusing on the home with an always-on solution we could interact with from across the room vs through a screen. It also meant Amazon did not have to worry about picking a platform and then investing time and effort in convincing developers to embrace it. However, Echo is not for everybody, due to the main speaker functionality and the price tag associated with it. So Amazon came up with two new products: Tap and Dot. Tap is a smaller, battery operated, portable Bluetooth speaker that helps Alexa get out of our home and keeps the experience consistent for the user. As it is the case for Echo, Tap is more about Alexa than the speaker. Dot serves a different purpose. One would think Amazon could have used Dot to lower the barrier of entry for Alexa. After all, it is half the price of Echo. Instead, this is a device available in limited numbers that can only be ordered through Echo. The barrier of entry it might help break is the one of getting users to experiment with buying through Amazon with Echo. Dot builds on Echo to expand the range of interactions between us and Alexa so user engagement can grow and the reliance on Alexa can intensify. However, devices are not the only part of the equation Amazon needs to grow for that reliance to deepen.

Increased functionalities and discoverability will be key for long term success

Maybe because Amazon rolled out Echo without talk of world domination or maybe because everybody thinks all Amazon wants to do is to sell Echo’s owners more “stuff”, Alexa has become the belle of the ball in no time, with connected home devices brands lining up to work with her.

Amazon has done a great job at keeping users informed of what it is adding every week, both through the app and via email. This not only gets you to try new things but gives you the clear feeling your investment has been worthwhile.

This week, Amazon has taken another step in increasing the value Alexa will have by introducing new, open software that will allow more connected home devices to work with her. The smart Home Skill API, as Amazon calls it, will make it easier and faster for device makers to create the skills that synch their products to Alexa. More important for the users, it will make it easier to communicate with Alexa by cutting down on some of the current setup: “Alexa, ask the X thermostat to lower the temperature to…” For now, the new API is limited to thermostats, lights, switches, and plugs.

When it comes to home automation, however, we are at the very start and, while consumers are experimenting with it, Amazon needs to rely on more to make sure current users continue to engage with Alexa on a regular basis. Alexa after all, needs that interaction as, like every other virtual assistant, it learns from you. Growing content and coming up with different ways to shop with Alexa seem to be easier short term wins vs waiting for consumers to be ready for a fully connected home.

Could Alexa ever be Samantha?

While Alexa might be an important agent within our home, the big question is whether she could ever be Samantha, the powerful OS from the movie Her, unless she gets out of the home and spends most of her time with us. Tap, the HUD, and the deal with Ford are ways in which Amazon is already trying to do that but the experiences are not necessarily consistent and Amazon might not always be “learning” about them. The conspiracy theorists might be right and Amazon might just be about making Alexa our favorite shopping agent but, if the ultimate goal is to deliver Samantha and not just Alexa, the big question is can Amazon do that without getting into that rectangular slab of glass that rules our lives?

Published by

Carolina Milanesi

Carolina is a Principal Analyst at Creative Strategies, Inc, a market intelligence and strategy consulting firm based in Silicon Valley and recognized as one of the premier sources of quantitative and qualitative research and insights in tech. At Creative Strategies, Carolina focuses on consumer tech across the board. From hardware to services, she analyzes today to help predict and shape tomorrow. In her prior role as Chief of Research at Kantar Worldpanel ComTech, she drove thought leadership research by marrying her deep understanding of global market dynamics with the wealth of data coming from ComTech’s longitudinal studies on smartphones and tablets. Prior to her ComTech role, Carolina spent 14 years at Gartner, most recently as their Consumer Devices Research VP and Agenda Manager. In this role, she led the forecast and market share teams on smartphones, tablets, and PCs. She spent most of her time advising clients from VC firms, to technology providers, to traditional enterprise clients. Carolina is often quoted as an industry expert and commentator in publications such as The Financial Times, Bloomberg, The New York Times and The Wall Street Journal. She regularly appears on BBC, Bloomberg TV, Fox, NBC News and other networks. Her Twitter account was recently listed in the “101 accounts to follow to make Twitter more interesting” by Wired Italy.

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