Amazon’s Event and Its Fifteen Alexa Incarnations

Based on my experience last year, I was expecting Amazon’s event to be packed full of products, and it was. Yet, the more I listened to Dave Limp walk us through everything new, the more it was clear that there was only one product around which not just the event, but the entire line of devices is focused on, and that is Alexa. I know, you might think I am stating the obvious here, but what I mean is that Amazon considers Alexa the actual product they sell. If you think about it this way, it becomes much easier to understand why we see Amazon invest in so many hardware categories. This approach makes Amazon a very different hardware vendor and not just because they are prepared to break even. What we saw at the event where devices that did one of three things: expanded use cases for current users, lowered the barrier of entry for new users and helped Alexa get outside the home.

The Elephant in the Room: Privacy

Before getting to the new hardware, Dave Limp addressed the privacy concerns that were raised in the press over the past few months. Aside from reiterating the ability users have to delete any recording, he also introduced new ways in which consumers can interact with Alexa to find out more about why Alexa does certain things.

These two simple utterances: “Alexa, tell me what you heard?” and “Alexa, why did you do that?” help Amazon do three things:

  • Educate users on why and how things happen. Asking Alexa why music started playing and being told someone in another room on another device asked to play such music, or asking Alexa why she was answering when you did not actually mean to engage and have Alexa explain she heard her name when you might have said Alex, all help users understand how the underlying technology works. It turns some of what might be perceived as secret magic into a rational explanation, increasing transparency.
  • Make users feel more in control, not just of their own data but also in their relationship with Alexa.
  • Finally, it continues to build trust and bond through the exchanges as it is Alexa who is explaining to them what is happening.

Ultimately, Amazon and all other providers of digital assistants will continue to be scrutinized, and rightly so, as we put more and more of our lives into their hands. Finding the right balance between wanting users to share data to improve performance and relevance while being very transparent about how such data is used will remain a key driver of trust, engagement, and loyalty.

Driving New Points of Engagement and Creating New Points of Entry

Amazon added new features such as the voice of Samuel L. Jackson, the Food Network Kitchen (great pairing with the new Amazon Smart Oven) for cooking classes, and new smart alerts for Alexa Guard. These all aim at growing engagement for current users by finding new things to do with their devices and Alexa. New accessories like the Echo Glow, also help to add value to devices, like an Echo Dot, that you might already have in your kids’ bedroom. Possibly the simplest of products among what announced was the Echo Flex. An extremely affordable wireless-smart speaker that can add Alexa’s functionalities in those rooms where you want Alexa’s brains and voice but for which you do not wish to make a significant investment.

The opportunity to appeal to new customers comes in the form of a new Echo Dot Clock, Echo Show 8 and the Echo Studio. I think it is fair to say that sound had not been Amazon’s strongest value proposition with its Echo devices. While it had improved with newer generations, consumers bought Echo devices for their functionality first and then for sound. The new Echo Studio aims to change that thanks to a collaboration with Dolby that benefits both the hardware and the new Prime Music HD service by adding Dolby Atmos sound. The quality of the sound is impressive, and as you would expect, Amazon is making sure Echo Studio also works with your TV either as a single speaker, a pair or with your subwoofer. The best way I have to describe the sound is that it is incredibly immersive, letting you hear instruments you did not realize were there before. The main difference with stereo is that the music is not coming from two specific points, but the different sounds that make up a track are all around you.

The quality of the sound coupled with the aggressive price point of $199 will put pressure on other smart speakers that had been differentiated based on sound. HomePod, in particular, will feel the pressure, given Apple Music subscribers can access the service through Echo devices. As I doubt Apple will play on price, I am curious to see if there could be an interest in differentiating their sound quality even more by embracing Dolby Atmos for an HD version of Apple Music.

Taking Alexa out of the Home

Alexa continues to dominate in the home, but things are quite different once we leave, and we rely on our smartphones for most of our day. Amazon is undoubtedly aware of this, and much is done to make Alexa more readily accessible when we are out and about. The Echo Buds, a Bose collaboration, free Alexa from the smartphone giving us access to navigation, music, and search. The deal with GM also brings Alexa outside the home as her functionality is added to Chevrolet, Buick, GMC, and Cadillac cars that are 2018 and newer and have compatible infotainment systems.

These new devices coupled with an earlier announcement for simplifying multi-wake-word support speak to Amazon’s desire to limit frustration and make consumers pick Alexa because of the superior experience not because it is the only choice. The outside world is much more unpredictable than our home both in terms of context and requests, which is something Alexa still needs some practice on. The more entry points Alexa will have throughout the day, the more value she will deliver. Other two products launched under the “Day 1 Editions” program will also help Alexa be with us all day: Echo Loop and Echo Frames both aimed at being with us all day.

Continuing to Learn

The “Day 1 Editions” Echo Loop and Echo Frames are not developers’ products, but rather ready to ship products offered on an invitation-only basis to a selected number of customers.

Echo Frames are a voice-first experience delivered through prescription glasses. Rather than convincing people to wear glasses all the time, Echo Frames are aimed at people who have to wear glasses and might be interested in using them as a vehicle for voice-first interactions.

Echo Loop is a ring that you can tap and talk into to access Alexa more quickly than reaching for your phone. While many were expecting a smartwatch, I find Amazon’s interest in experimenting with different wearables fascinating as we know how hard it is to be successful in the smartwatch market that mostly remains an Apple Watch market, especially in the US. The way you would interact with Echo Loop is quite similar to how you use Apple Watch to access Siri. Interestingly I thought that cupping my hand close to my ear to listen to Alexa’s voice coming from the ring or putting my hand in front of my mouth as if I was yawning to speak to her was much more natural than raising my wrist to speak to Apple Watch although Alexa’s voice was much fainter than Siri’s.

The feedback loop that Amazon will create with these customers who will approach usage in a very open-minded way, similar an early adopter, will be extremely useful to Amazon to finesse the products both with features and use cases and ready them for more mainstream customers.

Amazon ended the list of new announcements with the introduction of a new wireless protocol called “Amazon Sidewalk targetted at extending the working range of low-bandwidth, low-power, smart lights, sensors, and other IoT devices. By extending the range using the unlicensed 900mhz spectrum, customers will be able to place smart devices anywhere on their property even without a Bluetooth, Wi-Fi, or cellular connection. An ambitious project that has opportunity way beyond the consumer market, something Microsoft should keep an eye on.

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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