M-Retailing

Tesco’s voice ordering with Google Home shows shift in how retailers sell

Tesco [IRDX RTSC] has teamed up with Google Home to allow Home users to add things to their Tesco shopping basket via voice. It also marks a fundamental shift in the grocery business.

According to Paul Wilkinson, head of technology research at Tesco Labs, the system not only listens to what you say, but can refine the list by referring also to your ‘Favourites’ and ‘Most frequently purchased items’ in the Tesco grocery app. “It prioritises these in the search results and so can be very specific on the products it adds to their basket,” he says.

But the move by IRUK Top500 retailer Tesco to use voice not only taps into the growing move towards how these smart devices play a role in retail, but also it marks a cultural shift in retail: Tesco is now allowing its customer to access it through Google.

Amazon’s Echo already allows users to add things to their Amazon Prime accounts, but this is the first time that a major retailer has used someone else’s interface to buy – and it could have an unwanted downside.

According to Hugh Fletcher, Global Head of Consultancy and Innovation at global digital consultancy Salmon: “The fact that Tesco is now promoting its sales through another retailer – Google – is a clear paradigm shift. Customers of Tesco are now accessing Tesco via Google. One thing that retailers and brands need to be wary of in a world of many interfaces is that branding and experience become less evident. As a result this could pose a risk to existing customer loyalty and brand equity that they possess with customers. While Tesco is undoubtedly right to get into this space and get in there early, for the sake of its future, we must hope that Tesco has also considered its strategy for customer ownership, data ownership and Tesco brand loyalty, or face becoming a tier two retailer accessed via an interface which isn’t owned by them.”

The move also marks the growth of the ‘virtual ecosystem’ for retail, believes Fletcher. “As we see these virtual ecosystems grow and become more widespread, we are likely to see a battle commence between the digital assistants such as Google Home, Amazon Echo and the imminent Apple Home, as retailers and brands affiliate themselves with one or the other. Tesco is one of the first of what will inevitably be a long line of retailers making the decision to offer its customers a voice controlled service, removing the need for a cumbersome, physical interface and allow consumers to slot digital services into their lives with less disruption.

 

Mentioned in this piece…

Tesco

Tesco

IRDX: RTSC

Tesco is the largest British supermarket chain. Tesco has a comprehensive multichannel offering, including mobile and tablet websites, click-and-collect options and home delivery. (more…)