The State of Voice Advertising: Ushering in A New Era of Customer Engagement

Given that over 26.2 percent of the US adult population today owns a smart speaker, it’s no surprise marketers are clamoring to find ways to engage audiences through voice.

First-mover startups offering end-to-end voice advertising services vaunt the potential of the voice medium to inspire two-way dialogue with customers, where engagement is measured through conversations rather than simply whether a customer clicks or doesn’t click on a digital banner ad.

Voice ads are also designed to be highly contextual - be it ordering a pizza on Super Bowl night or finding the closest flower shop on a customer’s wedding anniversary.

While these capabilities are latent in the technology itself, marketers haven’t yet discovered how to exploit them. During a recent panel discussion at the VOICE Summit in Newark, experts discussed the state of voice advertising today. 

1. The state of voice advertising today: a nascent technology with huge potential

Voice represents a whole new channel for reaching consumers, and brands are currently grappling with how to integrate it into the customer journey as a self-service tool, point-of-purchase and digital advertising platform.

Currently, brands rely heavily on smart speakers like Google Assistant and Amazon Echo to reach their consumers. Neither of these platforms allows brands to run their own ads, although they can sponsor podcasts.

Instead, brands build “Skills” that enable customers to find information, perform purchases and other transactions or, less often, engage with the brand through an interactive experience. For instance, Capital One’s Amazon Alexa skills lets users request account balances, initiate wire transfers and track spending. 

Read more: Amazon Alexa and Echo Chief Evangelist on the Future of Voice Assistants

Meanwhile, Dunkin’ Donuts and Starbucks process voice-activated orders the same way they receive orders through their respective mobile apps. Other brands like WebMD and Purina use voice as an engagement tool where the end goal isn’t necessarily a purchase. Patients can consult a WebMD-approved, voice-enabled knowledge base to ask questions about symptoms and ailments, while the Purina Alexa skill provides pet owners with answers to basic questions about animal care. 

Brands that use voice expressly for advertising still rely on one-way brand messages delivered through podcasts or music streaming services, which are little differentiated from traditional radio ads beyond providing an accompanying digital banner ad users can click on for more information - if they’re listening on a computer or mobile device, that is. On a smart speaker, there are no visual cues, which presents another roadblock for marketers looking to capitalize on this space. 

“We are hoping that with the voice ads, we can develop richer engagement [...] so that brands can not only communicate their message but have dialog with their customers,” said Harish Goli, a product manager at Pandora. “I know this is a big promise. We’re not there yet, we’re not even close to that point.”

Read more: 4 Brands that Practically Invented Customer-Centric Advertising

In spite of its user experience shortcomings, voice already serves as a trove of customer data insights. Voice searches help marketers deliver more relevant content, just like your Google search results are used for ad retargeting. 

“We’re also able to use the information that we’re gathering about these customers on the devices and the additional skills and activities they’ve linked to their profile to be able to deliver more relevant content,” said Melissa Hammersley, cofounder and chief digital officer at Novel Effect, an interactive storytelling app. 

2. How brands hope to use voice advertising in the future for two-way customer engagement

Many of those working in the voice advertising space describe an envisioned utopia where advertisers can purchase dialogue-based ads where the brand asks the listener a question (eg: “what’s your favorite ice cream flavor?”), the listener responds through the microphone in their smartphone, computer, smart speaker or other IoT device and then receives corresponding content or a product recommendation - a similar format to a web chat.

Others predict brands will soon experiment with gamified storytelling experiences, or what Hammersley calls “in-person live activation using voice.” 

“We’re able to bring someone into a holistic experience that doesn’t necessarily feel like advertising, but something that’s more fun and engaging,” she said. 

San Francisco-based startup Instreamatic.ai, a “voice AI platform for dialogue advertising,” offers a unique ad management platform for advertisers and publishers, which provides some insight into what the future of voice ads might look like. 

When a listener hears an ad on a mobile platform, they can perform a variety of voice commands and get an instant response. These customizable target actions include utterances like: “I’m interested, tell me more,” “Buy it,” “Call a company representative,” “Download the app,” or “Skip the ad.” 

In Q4 of last year, the company rolled out pilots with brands like Volkswagen, IKEA, Hewlett-Packard, Samsung and Bank of America. 

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“What we’ve seen from the campaigns early on was that when we placed ads on platforms where users had never heard one of these ads before in their life, we achieved a 10-15 percent engagement rate, which shocked even us,” said Charles Andrew Whatley, SVP of business development and partnerships at Instreamatic.ai. 

Whatley attributes high engagement rates to the fact that voice ads are “a dialogue, not a monologue,” but the novelty factor could be a strong contributor. Once ads become pervasive enough on a specific platform, users learn to tune them out, if not block them altogether. 

However, Whatley is right in saying that an engaged consumer is more likely to buy from a brand. Marketers envision being able to user voice-activated responses to measure engagement and sentiment and enable the consumer to engage with the brand beyond simply clicking an ad and being redirected to the website. 

“Voice is a lot richer,” Gholi said of engagement metrics. “Click is binary - it’s either click or no click. With voice, you say something, it means something. There’s a tone, an opinion and sentiment, and we can capture all that.”

Gholi and his team at Pandora are developing their own voice assistant for the web and mobile versions of the app. The company is also working with “multiple players in the industry” to standardize voice ads by designing acceptable formats as well as localizing and regionalizing ad delivery.

However, others like Steven Goldstein, CEO of Amplifi Media, are more skeptical about the promises of voice advertising. As with any ad format, there’s a balance between the user experience and advertiser return on investment.

Most advertising is passive and can be easily ignored; with voice advertising, however, the onus on the listener to engage with the ad is much higher, which can be both good and bad. Also, the fact that brands can activate and deactivate a smartphone user’s microphone during ad playback can be seen as a privacy violation.

“I don’t know about you, but I’m not really interested in a relationship with Coca-Cola,” said Goldstein. “If they want to offer me a coupon, that’s great, but I’m not sure it goes beyond that.”

3. How to break into voice advertising: Where to start 

Like any other form of advertising, before venturing forth a brand must consider fundamental questions like, Does this further my brand? Is this the story I want to tell? and Does this matter to my audience? 

Always start with your audience, said Mary Alice McMorrow, an advisor at Earplay, a platform for interactive audio entertainment experiences. For instance, Subaru’s ads heavily feature pets as a nod to its pet-friendly cars. One of its latest ads shows a family of golden retrievers learning how to parallel park a Subaru hatchback. 

“[Subaru] went back to the fundamentals of their audience and realized that almost everyone of their consumers is a pet owner,” said McMorrow.” 

Read more: American Express on Why You Should Focus on Selling Value, Not Products

Another important consideration is whether or not the brand already features some form of sonic branding - such as Nationwide’s ‘Nationwide is on your side’ jingle or the distinct startup tones for the Xbox and Playstation consoles. Finally, remember that voice advertising is a medium for exploration, not scale and ROI.

“My recommendation is if it lines up with your brand and your audience, carve out 5 percent of your budget and do something,” said McMorrow. “The reason why is it’s probably going to fly under the radar and nobody’s going to call you out on why you didn’t get a good ROI - but the other reason is it’s going to allow you to understand how fast the industry is moving and you can be a part of the conversation, which I think is really important.”