Amazon, the ecommerce giant, is causing headache for other big technology companies and consumer facing businesses in America. After its success of taking down malls and physical stores, it has pushed its searchlight to grocery, through its acquisition of Whole Foods, a high-end grocery chain.
But doing all these activities will put Amazon in a position where it will have many enemies. Yes, it will be so exposed that there is hardly anything it does, that it will not be annoying partners. This week, Google and Walmart teamed up to deepen Walmart business; Google will provide a key part of the technology through its voice activated system and the Google Express.
Wal-Mart, the world’s biggest retailer, and Google, the internet’s predominant search engine, are teaming up in an attempt to challenge Amazon’s growing dominance in online shopping.
The venture, announced early Wednesday, marries Google’s hands-free voice activated Google Home program to Wal-Mart’s vast network of US stores to allow customers to order groceries and other items to be home delivered through Google Express.
The initiative is a direct rebuttal to Alexa, Amazon’s popular artificial intelligence program, and comes as the online retailer prepared to swallow Whole Foods Market in a transaction that will exponentially expand Amazon’s presence in brick-and-mortar stores and is expected to lead to home delivery of food through Amazon’s subscription prime program. —–
Scott Kessler, a CFRA analyst who covers Google parent Alphabet, said the announcement made sense for both companies, filling in a gap in Wal-Mart’s technology profile with the addition of voice-ordering capacity and potentially boosting Google’s standing in e-commerce.
There are many things we can learn from this deal:
- Walmart has understood that the competition is not just about having the items in the shelves at the lowest possible prices. One needs the technology to have any chance. It thinks it cannot deliver that technology. So, it went with Google
- Google itself understands the challenge over the vast empires Amazon is building and how that can affect its own business. Amazon in future can decide to build self-driving cars to help manage its logistics. Google knows that Amazon can come directly to anything it does
- Google wants to have presence in grocery, albeit through e-commerce, since that remains where most of the money can be made in America. This partnership with Walmart can help it build a business in that area and later make it available to other retailers. It is very possible that it can provide a vehicle to help others take up Amazon in the retail sector
Yet, I do not think Google has a better voice assistance system compared to Amazon’s Alexa. What is happening here is that Walmart will not willingly arm its competitor by adopting Alexa, since Amazon is a major competitor. So, irrespective of the quality of Google technology, that is always going to be preferable to whatever Alexa has to offer.
Maersk, the global shipping company, noted that it chose Microsoft Azure over Amazon cloud services partly based on the realization that Amazon is also a competitor in the logistics business. This is the same thing that happened in the Google – Walmart deal. Walmart cannot support Amazon by adopting Alexa.
Voice ordering is getting very popular in America. Amazon is leading in that space. This is designed to help Walmart catch-up with Amazon. It will also help Google build new services in this area. Finding that leg into the e-commerce and grocery will be very strategic in its capacity to compete against Amazon in the broad technology arena. Above all, many will buy Google Home, partly because of this deal, and that is good for Google.
Wal-Mart Stores head of e-commerce Marc Lore said the initiative will permit customers to voice order hundreds of thousands of items beginning in late September. Wal-Mart plans to integrate its “easy reorder” service into the program, which allows customers to repeat orders of household staples and other frequent purchases with a few fast clicks.
Voice is a new growth area and if more people begin to talk, over just search, the core business of Google will be challenged. This is why making sure that it is ahead of this curve is something that it has to do.
“We expect voice commerce to become a more important part of Google’s revenue model over the long haul, in particular as more searches migrate to voice platforms, and where transactions may ultimately stand in for advertising,” Sebastian said.
“For Walmart, we believe the partnership with Google helps address risks associated with the ramp (up) in voice commerce, in particular the increasing number of searches and product orders flowing through Amazon’s Alexa voice ecosystem.”
This trajectory will go global because voice is the original way humans have been communicating for ages. Places like Nigeria and Africa must of course deal with some accent and voice issues for the systems to understand them as I have noted in the past. Largely, it is very possible in the next ten years that most things will be done via voice.
What Walmart, Google, Microsoft and Amazon are all doing is setting up the stage for the next battle in computing: voice operating system. Anyone that builds the best will triumph. Think of Google Search supremacy over Microsoft Bing and Yahoo Search, and how Google has come to dominate search. The voice business will not just be for London and New York, the developing world has massive opportunities in the voice space since that is where the highest level of illiteracy exists at the moment. Computing delivered through voice will be more appealing there over the present text-based format. For entrepreneurs with capacity to do voice, this will be highly rewarding in places like Africa.
Opportunities in Voice in Africa
There are many opportunities in the voice assistance space in Africa. In short, if you make it, you will get customers even in the enterprise market. The following are simple examples:
- Banks working on agency banking will adopt the technology to reach customers who are largely not literate enough
- Insurance firms will also use it to build new solutions, based on voice
- Many government services will move from text to voice, solving the illiteracy barrier
- Africa’s leading ecommerce companies like Jumia and Konga will come on board. Of course, you must make sure such a technology works with our accents
There is a shift in computing at the consumer level, where people can talk to their phones and the phones get things done. The opportunity will be huge. Now is the time to think of Africa’s voice operating system.
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