Lab Weekly — 04/20/2018
Key innovations in ecommerce; Snapchat’s new AR ads; Amazon’s new ally; and more
Lab Original
Decoding Four Key Technologies That Are Transforming Ecommerce
Throughout the shopper journey, technology is disrupting the way we find, examine, compare, and order products online. With ecommerce now accounting for about 13% of total retail sales with a healthy yearly growth rate of 16%, whatever happens in ecommerce is bound to see a ripple effect throughout the retail ecosystem. Let’s take an in-depth look at four key value drivers in ecommerce one by one.
News Analysis
Amazon Taps Best Buy To Sell Smart TVs With Built-In Alexa-Enabled Fire TV [link]
This partnership gives Best Buy access to Amazon customers as those Fire TVs will also be available on Amazon in addition to the Best Buy store. It also broadens Amazon’s potential audience for Alexa, further helping the ecommerce giant conquer the home platform. We’ve been saying for a while that smart speakers are not the only thing that matters in this burgeoning smart home battle. Smart TV, as the focal point of many living rooms, is still a prime real estate that platform owners like Amazon and Google will be fighting over. And it looks like Amazon just gained another important ally in this smart home war.
It is also worth noting that under this new partnership, Insignia, Best Buy’s house brand, will also be powered by Amazon Fire TV. Previously, they produced TV sets powered by Roku. Ditching Roku and aligning with Amazon seems like a natural step for Best Buy, who has served as a major brick-and-mortar channel for the Echo devices. While cozying up to Amazon could get Best Buy a boost in TV sales in the short run thanks to all the Alexa fans out there, ultimately it risks of becoming an undifferentiated TV supplier in Amazon’s smart home value chain. But then again, as a general consumer electronics retailers, Best Buy at least can still benefit from this alliance by upselling other products and service when the Alexa-powered TVs entice people into stores.
Related: Amazon rolls out Prime Wardrobe to more customers [link]; Amazon quietly launches a “lite, fast, and private” Android browser for emerging markets starting in India [link]; Amazon adds International Shopping feature to its mobile apps, letting users easily shop for products when abroad [link]
Snapchat Launches Shoppable Augmented Reality Feature In Lenses [link]
There is no question that mobile AR is a hot area crowded with developers and brands trying to figure out the best consumer use cases. Thus it’s hardly surprising to see Snap is taking this pragmatic, albeit a little unimaginative, route to monetize its leading AR product. As an integration of its existing “swipe-up-for-more” direct response ad unit in Stories into the AR selfie lenses, this new feature allows brands to include a button on their sponsored Lens to drive traffic to web pages, promotional videos, and app downloads, all without leaving the app.
This addition is yet another effort from Snapchat to build out the social ecommerce platform and monetize all the eyeballs it attracts. Last December, the popular messaging app launched Lens Studio to foster a community around its AR Lens platform, and to date, user-generated submissions have tallied more than one billion views and more than 2 million hours of playtime, the company revealed in a new blog post.
Related: Zara AR app brings virtual models to life in stores [link]; Bareburger is using AR on Snapchat to drive people to its restaurants [link]; Nike to acquire computer vision company Invertex [link]; HTC opens up developer access front-facing cameras on the Vive headsets for AR features [link]
Amazon’s New ‘Alexa Blueprints’ Let Anyone Create Custom Alexa Skills And Responses [link]
This new service rapidly simplifies the creation of Alexa skills and make it possible for someone with little coding knowledge to use one of the over 20 templates available at launch to create their own voice experiences. Together with the Brief Mode added last month, Amazon is actively improving its conversational experience and making Alexa more intuitive and customizable, both will no doubt further propel the virtual assistant’s growing popularity.
Needless to say, this is a great tool that all brands can leverage to develop branded voice experiences to reach Alexa users. However, just because it can be easily created, doesn’t mean brands can just jump right in without figuring out the kind of added value that your brand can provide customers via Alexa. Be it informative, entertaining, or practical, a branded voice experience should serve certain concrete functions that are additive to the customer experience.
Related: Alexa adds new “Brief Mode” that replaces verbal confirmations with chimes [link]; Diageo becomes the latest spirit brand to serve up mixology tips and recommendations via branded Amazon skill [link]; WeWork, Capital One welcome Amazon’s Alexa to the enterprise [link]; Alexa for Business can now make phone calls in hotel rooms [link]; Google Home smart speaker launches in India, joining Amazon Echo [link]
Domino’s Now Deliver To 150,000 Non-Traditional “Hotspots” Including Parks And Beaches [link]
By enabling customers to receive delivery orders in locations that don’t have traditional addresses, Domino’s finds a cool way to encourage spontaneous orders outside the usual home/office deliveries. This new feature adds flexibility and convenience to Domino’s customer experience and is illustrative of the pizza chain’s digital-driven approach. Domino’s now sees over 60% of orders in the U.S. coming in from digital platforms. Earlier this year, CEO Patrick Doyle predicted in an interview that the company will see more voice orders from customers and deliveries from autonomous cars. As a good example of giving the customers what they want wherever they are, this new feature is worth considering by all delivery-driven businesses.
Related: Study: use of mobile apps for ordering meals is on the rise [link]; Domino’s created a mobile game to let players earn reward points for free pizzas [link]; Uber Eats is the fastest-growing meal delivery service in the U.S., while GrubHub remains the biggest food delivery platform [link]
Stats To Know:
Jeff Bezos revealed Amazon now has over 100 million Prime members worldwide in a letter to shareholders. In 2017 alone, Amazon added more Prime members than any prior year, and shipped over five billion items through the paid membership service worldwide, Bezo wrote.
Netflix hits 125 million subscribers worldwide, the company revealed in its latest quarterly report released on Monday. The streaming giant added 7.4 million new subscribers in the past quarter, due mostly to its expansion into foreign markets, beating analysts’ expectation.
While only 2.8% of food and beverage sales in the US will occur online in 2018, according to eMarketer’s estimates, there is no doubt that online grocery is an area with strong growth potential. Recent data from Coresight Research found that 23.1% of US internet users said they had bought groceries digitally in the past year, and 25.8% of respondents in the same survey said they expected to buy groceries digitally in the next 12 months.
