Research Highlights

Alexa and Other Voice-Activated Shopping Devices Boost Consumer Spending, According to New Research

Xiao Liu and Anindya Ghose
As the holidays approach so begins the busiest shopping time of the year – a time when retailers can take advantage of consumer behavior trends to boost sales.  This holiday season, retailers should take note of a new study by NYU Stern PhD student Chenshuo Sun and Stern Professors Xiao Liu and Anindya Ghose, along with their co-authors Zijun Shi at HKUST and Xueying Li and Feiyu Xiong of Alibaba.  The research finds that the use of voice-activated shopping devices (voice AI), such as Amazon Alexa and Google Home, increases both the quantity and dollar amount of consumer purchases.

The paper, “The Effect of Voice AI on Consumer Purchase and Search Behavior,” is the first to study voice AI’s impact on consumers’ search and purchase behavior in an e-commerce setting. The co-authors explored how the use of voice AI might change how much consumers purchase as well as which products are most likely to be purchased through a voice AI device.

Results of the research showed:
  • Younger, active consumers with high-income levels tended to purchase a higher quantity of products while shopping with voice AI as compared to their behavior shopping offline. 
  • Younger, less active consumers with low-income levels were apt to increase the amount of money spent on their purchases while shopping with voice AI as compared to a brick & mortar retail setting.
  • Voice AI does not cannibalize other shopping channels; rather it boosts purchases through traditional PC and mobile shopping. 
  • The adoption of voice AI shopping led consumers to search for an increased amount of products overall.
“As voice-controlled smart devices take off, voice-activated shopping is showing signs of considerable growth,” said the co-authors. “Our research provides useful implications for both e-commerce companies and businesses that harness voice-activated shopping.” As this study demonstrates, businesses looking for a boost this holiday season should consider the positive effects of voice-activated shopping devices on consumer purchases.