COVID-19 and the Voice Assistants Market

August 2021

Telecoms & Connectivity

James Moar

Research Analyst

Usage of voice commands has increased since the COVID-19 outbreak, with 52% of voice assistant users saying they use voice tech several times a day or nearly every day, compared to 46% before the outbreak. 
Popularity of voice assistants is driven by their ability to facilitate touch-free human–computer interactions in a natural and intuitive way, similar to the conversations between human beings. 

However, the global COVID-19 pandemic has caused a significant decline in hardware manufacturing operations during 2020, which alongside suspension of some eCommerce platforms (due to localised lockdown imposed by many governments) has negatively impacted the voice assistant industry on the hardware side. Moreover, ongoing problems with software interoperability and globally available connectivity, along with security and privacy concerns, will continue to act as partial growth restraints going forward.

The mass adoption of artificial intelligence in users’ everyday lives is fuelling the rapid shift towards voice applications. IoT devices and ever-expanding use cases are giving voice assistants tangible value in a connected user’s life. Microphones are everywhere and access to voice assistants has become ubiquitous, with B2C and B2B companies eager to monetise this trend. 

Opportunities for voice technology as a result of the global COVID-19 pandemic have also resulted in more players in the voice space. As the pandemic creates a need for less touch and more voice applications, more organisations emerged to offer these capabilities.

Digital voice assistants are a classic example of multi-player products; technological platforms that enable the interaction of two or more stakeholders. The rapid spread of digital assistants is prompting many companies to increase investments in the field of digital assistants. However, while the design and development of a single service for these platforms are becoming more easily achievable from a technological point of view, monetisation models in this area present many companies with significant challenges. 

Voice assistants’ ecosystems are usually complex. The technology provider of the voice assistants acts as a platform operator. Basic user groups consist of the end users of services and processes; providers of services and processes, as well as companies that provide applications to which users can access services and processes. Although the providers of processes and services are often also the ones who provide the application, there are also platforms on which software developers provide services and processes of other users. The complexity of these interlocking levels makes it difficult to achieve straightforward monetisation. 

As the market for voice assistants matures, multi-faceted revenue models will emerge. Monetisation models need to fit the usage scenario. Some scenarios lend themselves well to subscriptions, while others are better for one-time purchases. Others yet can be used to drive customers to another monetisation platform (such as mobile apps). As the investment in voice assistants grows, so does the desire to show more of a direct impact on the bottom line rather than relying solely on increased customer satisfaction and growing NPS scores. In this section, we will look at the most important participants in the value chain, and the different business strategies that allow for successful monetisation of voice assistant products and services.