Digital assistants are increasingly commonplace, and the trend is pressuring merchants and issuers to figure out how to keep up with consumers' interest in conversational computing.

"Awareness of voice tech is very high and that's going to drive new purchasing habits," said Kiki Del Valle, senior vice president of commerce for every device at Mastercard.

Chart: Rise of the chatbots

Mastercard released research with Mercator late last week, assessing the growth of computerized assistants such as Apple's Siri, Microsoft's Cortana, Amazon's Alexa and Google Assistant.

Mastercard has several projects underway that respond to consumer preferences to use connected devices, which impacts how consumers engage with virtual cards And it also is testing the uses and limitations of voice technology for payment execution and ID in the myriad projects underway to place Mastercard into new connected devices.

While it's not unusual for a brand to release research that supports a strategic initiative, there are several takeaways that suggest voice and AI assistants bypassed the typically longer early adoption periods that the internet and smartphones had to endure. And Mastercard and Mercator's research is backed by other reports that show the quick acceptance of AI and voice among consumers.

According to the recent study of 3,000 consumers conducted by Mastercard and Mercator, two-thirds of U.S. consumers use either voice assistants or messenger/text chatbots. Out of these, one in five use chat for commerce. Those who prefer voice assistants for shopping prefer its ease and speed over texting. Those who prefer chatbots cite text’s accuracy compared to voice as well as privacy, which is why messenger bots are favored for use in the workplace, according to Mastercard and Mercator.

The challenge is how AI, chat and voice change the more scripted interactions consumers have with e-commerce and online banking sites. In the past, consumers and merchants used the language of payments, credit card companies and merchants. Now consumers are more actively driving the vocabulary.

"We want to know about permissions at the user level and real-time notifications," Del Valle said, adding permissions or IDs need to keep in mind the difference between conversational commerce and the older practice if keying in card information at a checkout page. "People don't always know their card number, for example."

The card brand plans to expand its smartphone photo authentication system (commonly known as selfie pay) to Europe over the next year. It is also aggressively pursuing messaging projects with Facebook's chatbots to power ordering for FreshDirect, The Cheesecake Factory and other merchants. Mastercard's work with FreshDirect overlaps a project with Samsung to enable ordering and payment for web-connected refrigerators.

"This will all become more conversational, and there needs to be more intelligent interfaces," Del Valle said. "The consumers also need to understand the technology's limitations … there is still a disconnect between knowledge and general use."

While there is some pressure on merchants to develop strategies for voice and AI, the current use cases are still very basic. The most common use for voice and text-based agents are informational tasks such as internet searches, merchant inquiries, looking for gas stations, directions or commands to make calls, play music or send texts, according to Mastercard and Mercator. But 21% did say they use voice assistants and/or chatbots to shop, buy, pay bills, bank or send money.

"We are seeing a shift in how consumers acquire information with voice-based search on the rise, especially among younger subsets," said Michelle Evans, head of consumer research for Euromonitor International. "In time, this will likely impact how a wider part of the population prefers to research commerce decisions and execute purchases, but today it is likely limited to certain consumer subsets and specific categories where voice is advantageous over type."

That said, consumers who use connected commerce do so to save time and money, rather than avoid people or out of a general preference for electronic chat. Whether a company should invest in technology that would enable such experiences comes down understanding its specific consumer base and whether it can effectively create an experience on these platforms that would further its brand ethos, Evans said.

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John Adams

John Adams

John Adams is Executive Editor of PaymentsSource.