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You are here: Home / Customer Engagement / Amazon Alexa Is Biggest Opportunity
Amazon Sees Echo and Alexa as Its Biggest Opportunity
Amazon Sees Echo and Alexa as Its Biggest Opportunity
By Jennifer Van Grove Like this on Facebook Tweet this Link thison Linkedin Link this on Google Plus
Without revealing specifics, Amazon executives Thursday offered the biggest clue yet that Amazon Echo products are kind of a big deal. In a conference call with analysts highlighting its first-quarter results, Amazon specifically called out its voice-based devices, which are powered by an artificial intelligence platform referred to colloquially as "Alexa," as its No. 1 opportunity.

Chief Financial Officer Brian Olsavsky said the e-commerce company is "doubling down" on its investment in Amazon Echo products, meaning it plans to spend big to improve the technology and get more Echo units into more homes.

"We're very encouraged by the customer response to Echo products," he said. But as for actually making money from them, "that's not our primary issue right now."

The statements, coming a day after the launch of Amazon's Echo Look hands-free camera, further confirm that the company has no plans to back off from this nascent business, despite the fact that device sales aren't yet padding the company's profit margins.

Though Amazon has never disclosed sales figures, third-party research firm Consumer Intelligence Research Partners estimates that 8.2 million U.S. consumers own the original Echo, the smaller Echo Dot or the portable Echo Tap.

On the whole, Amazon reported $35.7 billion in net sales and $724 million in net income for the first three months of 2017, with both results coming in higher than analysts' predictions.

In addition to shelling out on Echo development, Amazon also signaled on the conference call that video remains a top area of interest, meaning consumers should expect a continued back-and-forth with Netflix in the content department. In fact, spending on video content and related marketing -- as in inking pricey licensing deals like the one with the NFL for Thursday night games -- was listed second by Olsavsky as he rattled off the company's areas for increased spending.

Amazon recently started selling its Prime Video product as a standalone streaming service for $9 per month. Previously, the company had only bundled the digital video perk, which includes access to award-winning original shows, with its annual Prime subscription.

This year, Amazon Video is anticipated to reach 85.3 million viewers in the United States -- or nearly 12 percent more than last year -- according to digital analytics firm eMarketer, which assumes that there are 2.5 viewers for every 1 paid subscription.

© 2017 San Diego Union-Tribune under contract with NewsEdge/Acquire Media. All rights reserved.

Image credit: Product shot by Amazon.

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