Monetization has been challenging for voice app developers across platforms, but Amazon has been making a concerted effort. While Amazon is an early leader with the most voice apps of any platform, the current monetization is limited in scope. As of now, the major monetization channel from Amazon on Alexa-enabled devices is more purchases from Amazon.com. Implementing new monetization tools for Alexa skills is good for Amazon’s long-term success in the nascent voice assistant market.
As a burgeoning platform, if customers had been bombarded with ads from the get-go, it’s unlikely that Amazon would have seen a tremendous success that it has. Now that it’s already in roughly 30 million homes, Amazon can slowly start tinkering with how to make more money using:
Subtle Voice Advertisements
- Currently, users can order a Starbucks frappuccino, a pizza, or an Uber etc. from Alexa. But these are just skills and not advertisements.
- Amazon is currently in talks with Clorox, Proctor & Gamble, and others to promote their products on Alexa and can use subtle voice ads to make more money
- E.g. if user use Echo to re-order P&D laundry detergent, for instance, Alexa could suggest another P&G product, confirmed with a simple yes or no voice confirmation
- Similarly, if user look for instructions on how to cook a recipe, Alexa could similarly offer suggestions for products he/she may find helpful
- Currently, ads on the platform must use a completely different voice. In future, Alexa can herself suggest products blurring the lines
Promoting Certain Skills as Sponsored Skills
- Alexa has access to more than 25,000 skills, about 53% of consumers use only one to three of them, while 14% of consumers haven’t even enabled a third-party skill
- To drive greater adoption of Alexa, Amazon will need to provide more visibility to certain third-party skills. They can do this for exchange of money for sponsored skills
- Revenue-sharing Model for Skill
- In-skill purchases enable developers to sell premium content or digital subscriptions within their skills
- Amazon can monetize the in-skills transactions via a revenue-sharing model between Amazon and developers
- Using Amazon Payment Gateway for In-skills Purchases
- The extension of Amazon Pay should allow third-party developers to accept Amazon Pay for in-skill purchases
- This way Amazon can make more money from payment gateway
- Personalized Advertisements while Streaming Music
- A lot of users are streaming music in Alexa using skills
- Amazon can push usage of its own skill, Amazon Music and, leverage between-song advertisements
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