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The Future Of Voice Will Be Contextual Conversations And Interactive Experiences

The march of the virtual assistant towards global domination is gathering pace. A report by eMarketer said that mass adoption of virtual assistants is slowly becoming a reality. Voice-enabled device usage is forecast to show a year-on-year increase of 128.9% in 2016, with 60.5 million Americans expected to ask a virtual assistant—Alexa, Cortana et al.—to do something just through the power of their voice.

Over the next few years, there will be a significant increase in not only the number of devices available but also the voice-related capabilities of the leading platforms. Companies that have already nailed their colors to the voice-enabled mast will (unsurprisingly) dominate the market, the report said.

Google, Amazon, Microsoft and Samsung have either products available or are working with partners to build devices. Apple’s Siri is widely rumored to be getting a sleek new physical body in the not-too-distant future, which could propel the voice-activated assistant market into the stratosphere.

“Consumers are becoming increasingly comfortable with the technology, which is driving engagement,” said eMarketer’s vice president of forecasting Martín Utreras, in a blog post. “As prices decrease and functionality increases, consumers are finding more reasons to adopt these devices.”

Amazon Alexa

Voice Interfaces Will Become The Norm

Voice recognition technology in the form of natural language processing has come on in leaps and bounds, so much so that devices that don’t incorporate some form of voice control or interaction will seem, well, dated.

For the moment, Amazon is the clear leader. Around 35.6 million people will use a voice-activated assistant device at least once a month in 2017, eMarketer said. And 70.6% of those people will be speaking to a member of the Echo family.

Google Home—which does have the advantage of a superior search tool in Google Assistant—will account for 23.8% of the market by the end of the year. The remaining 6.6% is likely to be shared around a variety of manufacturers that are starting their own voice-activated journey.

What is beyond question is that in the not-too-distant-future voice user interfaces will become the norm. The big names in 2017—Alexa, Google Assistant, Microsoft’s Cortana, Siri and Samsung’s butler-sounding Bixby—may be leading the field now, but there is a consensus that the time is right for voice to take center stage.

The challenge will be to provide people with voice-enabled experiences that do more than just relay news, play music or provide weather and traffic information.

According to Boston-based Earplay’s CEO Jon Myers, the mass adoption of voice-activated devices will require simulated conversations and narrative entertainment platforms. And, in Myer’s view, the increased focus on voice-activated skills—arguably kickstarted by Alexa—will validate a market that seems to have come out of nowhere.

“It’s not about the technology, it’s about user experience and design,” said Myers. “A lot of the technology behind speech recognition and natural language processing has been around for quite a while. It’s not as if the tech has taken a sudden leap that has made it so much better and everybody wants it … it’s the fact that a company like Amazon spent a lot of time making sure that the user experience was solid.”

Contextual Conversations Will Increase Adoption

The twin pillars of user experience and design are validated by the hype that currently surrounds voice-based tech.

At Google’s I/O 2017 developer conference in Mountain View, voice-activated interfaces were front and center. By the same chalk, the Amazon Echo now comes in a variety of shapes and sizes, all of which bring voice control to the forefront of device engagement. And lets not forget that other leading brands are looking to jump onto the voice bandwagon.

Myers cites a change in consumer attitude to speaking out loud as one aspect that has made voice such a hot topic. On a psychological level a person can get the information they want in an intuitive and fluid way, which enhances the overall user experience. For that reason alone, companies should be looking to use contextual conversations as a basis for engagement or fun.

On the flip side, many of the skills or actions available via existing devices do require a certain degree of structure to get the right answer or provide a worthwhile experience. For example, the Earplay skill provides people with interactive story-telling content—a sort of choose-your-own-adventure that echoes the halcyon days of radio dramas. The difference is that the skill allows people to play an active role in a dynamic storyline … just by using your voice.

Microsoft Research Assistants

“Some people see us as a game … and that’s cool,” Myers said. “Early on we were trying to work out where we fitted into the apps store … are we an audiobook or a game? Eventually we gave up trying to pigeonhole ourselves and said we that we were voice-driven interactive audio entertainment. We invented our own medium!”

See also: Why Traditional Digital Metrics May Not Apply To Voice Apps

In some ways, the need for contextual capabilities in voice-activated devices mirrors the trend for chatbots. Real-time conversations with digital assistants are at the top of the list for many brands so it makes perfect sense that contextual engagement would play a role in expanding the benefits of voice interaction.

“It depends on what the company’s goals are,” Myers said. “If they’d like to enter into the space anew with their own product, then they should be aware that voice experiences are deceptively easy to construct and prototype. What follows is a difficult path and a lot of work from prototype to a high quality experience that will do well upon release. In our experience, the design often requires more time than the engineering.”

People Can Do Cool Things With Their Voice

With that in mind, there are numerous signs that voice-based interactions are about to hit the next level.

Towards the end of 2016, Google opened its “Actions on Google” platform for developers with the sole intention of giving people the ability to have a two-way dialog with its virtual assistant. Amazon Web Services have made the AI technology behind Alexa available to anybody who wants to build a conversational interface. And you don’t need a crystal ball to realize that voice can provide value to any brand that wants to “talk” to its customers.

In what should not be a shock to anyone, voice-based computing is also on the radar of venture capitalists.

Take Voicecamp. The New York-based accelerator is running an 11-week funded program for eight startups that are building conversational interfaces as part of voice-controlled ecosystem. The program—which includes Earplay—is intended to bring developers and platforms together, with the overriding aim of making voice-based computing a “natural and frictionless end user experience.”

All of this is good news for developers and people who see voice as a perfect conduit to merge the worlds of digital and physical experience. Smartphones have ruled the roost when it comes to brand engagement on a device, but they still require people to hold things, press buttons and scroll to get the results they want. Just speaking into thin air is so much easier and (in theory) less time consuming.

“Technology in the voice space has been regularly improving for several years, but suddenly voice is emerging everywhere,” said Myers. “The primary catalyst is not any particular breakthrough in technology or a new way that we’re processing speech. Instead, it’s instead the monthly breakthroughs in how we enable people to use their voice to do cool new things.”

Apps targeting young people

Naturally, banks and online brokers are also increasingly offering mobile solutions for stock trading. However, this new group of fintech startups has a different structure than traditional providers. As international apps with social media appeal, they are aimed at a particularly young target group of 25- to 35-year-olds who want not only access to stock trading but also a new kind of user experience. It has become clear that accessibility and user-friendliness are key selling points for these new investment apps. For example, according to Bitkom’s Digital Finance Report 2020, 40% of respondents expressed the expectation that “smartphone apps’ ease of use for stock and securities transactions will enable more people to benefit from companies’ performances.”

In a nutshell, the easy access via smartphones makes these “neobrokers” so appealing. Clear design, community integration, and ease of entry has turned UI/UX into an actual product.

Special opportunities – special risks?

Many apps have little to no limit on how small a trade can be, making it possible to buy fractional shares. As mentioned, they charge very low fees — or none at all — and are available outside of regular trading hours. The apps clearly aim to lower the entry threshold for stock trading, and sometimes lure new users with free shares. On the flip side, the apps offer no or minimal investing advice, unlike traditional brokers. Consequently, purchasers must do their own research outside of the app, using articles, forums and social media. This aspect has raised suspicions in the German market. In the survey undertaken for the Bitkom Digital Finance Report referenced above, 69% of respondents stated that “an advisor’s input is absolutely key to making good investment decisions.” As a result, the separation of professional advisory services and the gamification of trading stocks carries certain risks, especially for inexperienced users.

Too much power?

The potential dynamics unleashed by direct market access were demonstrated in an interesting case study in January. Small investors coordinated a purchase of GameStop stock via Reddit to prevent a decline in the company’s value, on which hedge funds had speculated. In fact, the Reddit community’s actions were so successful that U.S. authorities are now investigating the possibility of market manipulation. Outrage erupted, however, when Robinhood simply suspended trading in GameStop shares at the height of the buying frenzy.

Ultimately, the neobroker did have a good reason for halting trading. The security it had deposited with clearinghouse DTCC was insufficient to match increased trading volume. However, this episode illustrates that some luster has fallen from the new market power of small investors: Even trading apps do not eliminate the intermediary function; they only replace it, sometimes with even more opaque conditions than before.

The outlook is promising

And yet, neobrokers are attracting young investors by reinventing the process of investing and stock trading. With pleasing designs and customer experiences geared toward millennials, these apps will be able to gain many users in the next few years. At that point, they will have to show that they can keep up with the momentum that they created. Users expect apps, acting as financial service providers and managers of highly sensitive data, to be error-free at all times and in all places – and rightly so. User trust and compliance with financial rules will play a crucial role in determining whether neobrokers will remain competitive as market penetration continues.

However, the new investment apps’ penetration of the DACH market is still at an early stage. Established providers, especially banking apps, may leverage the trend by incorporating a more attractive UX and simplified investment features into their existing apps. For example, a whitepaper from the Sparkassen Innovation Hub on the topic of changing values recommends “opening up products to small investment amounts” as well as “using a clear, appealing interface (UI), playful elements for data entry and maintenance, [and] the use of status and progress indicators to guide users through processes” to attract a new group of potential investors.

One thing is certain: The phenomenal growth of investment and trading apps, especially in Germany, could be a precursor to interesting developments in the coming years.

David Bolton
David Bolton
Former ARC Writer
Published On: May 23, 2017
Reading Time: 7 min

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