VPAs: The Way Forward
SAMIR ALAM explores how Voice based Personal Assistants (VPAs) can transform apparel e-commerce.
A look at how Voice based Personal Assistants can transform apparel e-commerce
Once again, retail and commerce have arrived at an inflection point. For thousands of years previously, the nature of retail remained the same– a consumer would meet and interact with a seller to purchase goods and services. The last 20 years experienced a paradigm shift in this ancient craft, as e-commerce permitted people to digitally engage with retail activities. But despite being one of the newest segments in the retail industry, e-commerce has continued to evolve and change at an unprecedented rate.
Now, we are witnessing a fundamental change in how consumers conduct their retail activities– not with a click on a screen, a tap on the phone, or a meeting in a shop– but by simply speaking out loud what it is they want to their virtual voicebased personal assistants. This is the inflection point of e-commerce where the traditional user interfaces and experiences of customers will drive forward the nature of the new retail economy. Welcome to the future.
VPAS AND ARTIFICIAL INTELLIGENCE
The new technology that is altering how consumers shop is as significant to the market as the internet was in the last generation. For those unfamiliar, VPAs are devices that can listen and converse with consumers to conduct a variety of tasks. A user can simply speak out loud and give verbal instructions to the device executing tasks such as setting schedules, reminders and alarms, updating users on news and information, making calls or sending text messages, and of course making online purchases. Devices such as Amazon’s Alexa and Google Home have becoming increasingly popular and affordable tools, powering the rise of the voice-based e-commerce market.
These VPAs are perennially connected to the Internet and are capable of recognising human voices and meanings. Powered by cutting-edge artificial intelligence algorithms, VPAs can make sense of simple instructions and rapidly respond
with their answers. Due to their connectivity to the internet and their sophisticated technological design, they can be programmed to interact with users through audio, and in effect give the appearance of being just another person– a personal assistant for every user. The simple act of being able to speak and ask for information or give out instructions has begun to revolutionise the way people interact with the internet and information in general.
The idea represented in science fiction movies has nearly become real as people can now speak with machines and have these machines carry out tasks on their behalf. Not only is speech a simpler, easier and more convenient means to interact with these machines, but it also allows humans to behave more naturally and intuitively– sharing their needs as they occur, and leaving it to the artificial intelligence of the machine to organise them. So if users forget conflicting appointments on their schedule when making a new entry, the machine will gently remind them and even suggest other solutions. This kind of adaptable intelligence to practical problems makes VPAs a powerful tool for retailers as they attempt to serve customers and sell products.
DIGITAL RETAIL AND VPA IMPACT
The global retail sector has been on a consistent upward trajectory, and is projected to rise from USD 23.5 trillion in 2017 to USD 31.88 trillion in 2023, according to Mordor Intelligence. This represents a Compound Annual Growth Rate of 5.3 per cent and includes the e-commerce segment as well. The e-commerce segment, however, is growing at a much faster pace, having grown 24.8 per cent over 2016, to reach USD 2.34 trillion in 2017. So far, the e-commerce sector has witnessed mobile devices as a growth channel for retail sales. The global e-commerce impact was over 40 per cent of the total, with USD 1.357 trillion in retail sales, with large regions
like China, Japan, the UK and the US leading the way.
Interestingly, it is perhaps the mobile commerce sub-market which VPAs are aggressively targeting and leveraging as they grow more popular over time. It is highly likely that we may witness a lateral shift as mobile commerce becomes entirely subsumed by VPA commerce in the next 10 years as mobile devices and VPA devices become one and the same. With the popularity of mobile assistants such as Siri, Alexa and Google, this is a reasonable result, as the most convenient VPA would accompany a user just like a mobile device. In fact, the adoption rate for VPA devices has also surged, with projections of over 650 per cent growth rate over five years, while mobile adoption has only been estimated to be just over 285 per cent.
VPA AND APPAREL
For the apparel and fashion sector, VPAs offer many new opportunities for businesses to serve and delight their customers. According to a 2018 report from Accenture, customers are seeking hyper-personalised solutions to their shopping needs. With an increasingly younger population, these millennial and Generation ‘ Z’ consumers are seeking out greater convenience and time efficiency when it comes to the most routine tasks. These tasks include things such as scheduling, information access, and shopping. As a survey by Capgemini demonstrated, over 40 per cent of consumers prefer VPAs over websites or mobile apps due to these reasons.
For apparel retailers, this means that they need to engage with digital transformation on their consumer facing operations in order to
interface with them on this new platform. Major retailers such as Wal-Mart have already begun this process by partnering with VPA provider Google to link directly to consumers. In essence, retailers can set up a shop inside the consumer’s home but the challenge for fashion and apparel will be to offer a customer experience that allows consumers to feel comfortable purchasing clothes through this method.
The challenge in this space is the essential visual aspect of apparel which requires more than just voice. Fashion and apparel retailers need to look at companies in a similar space to learn and develop their customer facing solutions. For example, French cosmetics retailer Sephora has an app on Google’s VPA which allows customers to make bookings for beauty services. The most apparel centric development in this space has been from H&M, which announced the launch of two separate tools that rely on VPA systems. The company has partnered with Google’s VPA to offer customers styling and product recommendations, including mood boards and visual samples, via an authentic human voice.
By having a display interface, consumers can see a different colour, fabric, design and style options and then place orders using the voice system. An advanced version of this approach by H&M is also in the works, which uses augmented reality (AR) along with VPA to help customers shop for apparel. The AR technology allows users to view apparel products in 3D through a smart device in the comfort of their home, and even be able to virtually ‘try on’ the product to see how they look.
VOICE OF THE FUTURE
As VPAs become increasingly popular, there still remain key obstacles in their path to becoming mainstream. The affordability of VPA devices has improved over the recent years, but is still a major challenge in developing markets. The US $950 billion Indian retail sector, for example, is growing but the e-commerce potential is restricted due to limited access to key infrastructure like electricity and internet for apparel’s commercial progress. In addition, a significant portion of India’s retail sector is in the unorganised sector, with greater fragmentation within the apparel and fashion space. However, despite these limitations, the appetite of the affluent Indian consumer is ever increasing and VPA manufacturers are reducing prices on their devices to gain access to the customer. With greater technological innovations arising every day, we will soon see voice-based personal assistants become a more common presence in our homes and become a direct channel for our retail decisions.