Amazon Expands Alexa Skill Monetization for Digital Goods

Amazon announced today an expansion of monetization for third-party Alexa skill developers. Voicebot was the first to report on Amazon’s inaugural monetization experiment in late October with the Jeopardy! skill. That effort offered expanded Jeopardy! content for free to all Prime Members. It also offered a Prime membership promotion or the option to pay $1.99 per month by people interested in using the augmented game.

Today, that has expanded to include five additional games: Match Game, Ultimate History Quiz, Head’s Up and two additional variants of Jeopardy for teens and sports aficionados. A statement by Amazon commented:

Amazon announced one time, in-skill purchases available in developer preview. Select skills will feature free content, and offer in-skill purchases for additional premium content…The developer tools to enable in-skill purchases will be available early next year.

Following the Apple App Store Model

Michael Houlahan of Pullstring

Match Game is a television game show that first appeared in 1962 and has been off and on the air intermittently for that past 50 years. The current version is hosted by Alec Baldwin and runs on ABC. Voicebot caught up with Pullstring’s Michael Houlahan which developed Freemantle Media’s new Match Game Alexa skill with monetization. Houlahan commented:

This represents an opportunity to monetize in-app or in-skill. This [type of monetization] was a catalyst for the [Apple iOS] App Store and I think it will generate the same type of interest in the skill store.

Jeopardy was the first manifestation of this strategy. There is free daily content that drives user engagement. Then, additional content is offered so users don’t have to wait until the next day to play more. There is a cost to access the content without constraints. That is how Jeopardy! has been monetized and Match Game will follow a similar pattern. However, adding monetization is not as simple as adding a price tag according to Houlahan. “There is a lot of technique involved in determining when and where and with what frequency to prompt for an upsell.”

Showcasing Pullstring’s Converse Platform

Pullstring recently announced its new Converse solution that is designed to enable non-technical staff at agencies and brands to build Alexa skills. Houlahan suggests that several elements of Converse are highlighted in Match Game. The skill has daily content that is easy for the skill publisher to update on their own. It also features a blend of recorded audio and text-to-speech using Alexa’s voice which creates a richer user experience. And, it connects directly to Amazon’s payment API. Houlahan added:

With the payment API and all of the APIs Amazon makes available, we abstract that from the end user. A non-technical end user can develop a skill. So, when it comes to managing states and publishing the skill itself, we are allowing you to do it very rapidly.

Match Game with expansion packs and in-skill purchases will be available in mid-December.

Digital Purchases Versus Physical Purchases

It is interesting to note that Amazon is enabling one-time and subscription purchases for digital goods through Alexa, but not physical goods. Google is enabling the sale of physical goods through Google Assistant apps, but does not yet support the sale of digital goods.

The irony here is that Amazon is the global leader in transforming digital orders into physical deliveries while Google excels at delivering digital products. Yet, they have both rolled out the in-voice assistant purchase strategies opposite to their supposed strengths. However, Amazon is already delivering physical goods through Alexa. It just doesn’t make that option available to third party Alexa skill developers. Third parties get access first to APIs facilitating the sale of digital goods. Amazon’s strategy seems to be set on firmer ground given the Apple App Store analogy. Top developers from the mobile era were focused on digital goods and purchases. Physical goods and services came later.

Monetization Barriers Will Fall in 2018

One thing is clear. The monetization barriers will fall in 2018. Alexa skills like Jeopardy! and Match Game are just the start. Pullstring’s Houlahan believes this move will attract new talent to the Amazon platform. Now developers will have to solve the discovery problem so they have users to monetize. This is all just getting started.

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