Google Assistant, the search giant’s answer to Apple’s Siri and Amazon’s Alexa, will make money from ecommerce, according to Google ads chief Sridhar Ramaswamy.
The revenue model for Google’s AI service, which lives on devices like Home and smartphones like Pixel, had remained unclear until now. Apple’s main revenue source, the iPhone, clearly benefits from its AI platform, while Amazon’s Alexa technology is designed to stoke more buying on Amazon.
Earlier this year, a promotion that played on Google’s Home devices was a clue to how ads might work. Google said the promotion, for the Disney film “Beauty and the Beast,” wasn’t a paid spot, just an experiment.
“Promotion is only one aspect,” said Ramaswamy, Google’s senior vice president of ads and commerce, at the Google Marketing Next conference in San Francisco Tuesday. “More transactional than ads is how I would think about it right now.”
He mentioned the option to purchase items from select partners through Assistant, a feature added in February, as an example of Google’s approach to making money with Assistant. Google would likely take a cut of each sale, essentially the equivalent of an affiliate fee.
Even so, making money off Assistant is not the priority right now. “We are very focused on getting consumer experience right first,” Ramaswamy said.
Google will have to be aggressive and creative with its approach to transactions with Assistant if the company wants to hold a candle to Amazon’s Alexa-powered devices like Echo, Dot and now Show, which give shoppers quick and easy access to the company’s expansive inventory.
And there will still be ads on Google Assistant.
Google’s director of product management, Jennifer Liu, pitched Assistant to marketers during the keynote at the conference, inviting them to send their data on local ad buying to the tech giant for inclusion in Assistant results.
She previewed a coming feature for Assistant where consumers will be able to ask for locations that sell specific items. In the presentation, Liu asked Assistant where she could find a particular toy brand, called Snap Circuits, for her children.
In traditional search ads, local businesses have to pay to show up in results when consumers are searching for a specific item. (Ex: “Okay Google, where is the nearest place where I can buy Advil?”) It’s unclear whether businesses would have to pay extra for their locations to be included when this feature is rolled out to Assistant.
This feature for finding specific items nearby is different than asking Assistant the location of a specific store nearby. (Ex: “Okay Google, where is the nearest CVS?”) That option is already available on Assistant, and businesses are not currently charged for inclusion.