Cloud Artificial Intelligence

Why product placement ads could come to the Amazon Echo very soon

Firms such as Procter & Gamble and Clorox have been in talks with Amazon to bring ads for their products to the Echo, according to a CNBC report.

Cracking Open: Amazon Echo
Building a slide deck, pitch, or presentation? Here are the big takeaways:
  • Procter & Gamble, Clorox, and other companies are in talks with Amazon to bring advertisements to the Alexa-powered Echo smart speaker, according to CNBC.
  • The move could change the user experience for the Echo, and open a new advertising platform for the enterprise.

Advertisements for consumer products could soon invade the Amazon Echo. According to CNBC, firm such as Clorox and Procter & Gamble are in talks with Amazon to bring sponsored content to the smart speaker platform.

If it comes to pass, the move to further the use of advertising on the Echo could create a unique opportunity for organizations to be able to target consumers in their homes, possibly based on more contextual data. However, it could also impact the user experience or draw some privacy concerns about the Echo.

Citing "several people familiar with the matter," CNBC reported that Amazon is working with many different companies on possible advertising and business opportunities through Alexa. Some of the early conversations, the report noted, were about the potential for companies to pay for higher rankings in product search results listed through the Echo.

SEE: Research: Companies lack skills to implement and support AI and machine learning (Tech Pro Research)

Amazon has apparently been considering a paid search product for quite some time, but has been slow to pull the trigger. However, this could be a sign that Amazon is ready to make a move.

Advertising on the Echo (or any other Alexa-connected device for that matter) is important not only for its proximity to the consumer in his or her home or office. Voice-based ads will likely be more difficult to skip over than text-based ads in search results, and could be more impactful for companies.

One example of how this could play out, according to CNBC, is in targeted ads based on a user's past shopping history with Amazon. If a user were to buy one cleaning product from Clorox, for example, the Echo could suggest they purchase a complementary product as well.

Also, Amazon could have Alexa mention specific brands regardless of shopping habits. According to CNBC, if a user asks for toothpaste, Alexa may ask if they would like a specific brand, such as Colgate.

Ads could also be integrated into specific skills as well.

Advertising on smart speakers is controversial, to say the least. An unintended Beauty and the Beast ad on the Google Home in March 2017 provoked a negative response from many users. But even though ads may turn off many users, companies may not be able to resist the potential new revenue streams made possible by voice.

Another possibility is that these digital assistants will move to a freemium model, much like Spotify, where ads could be served unless the user upgrades to a paid monthly subscription.

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Image: Ry Crist/CNET
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