Amazon announced today that Alexa and the Amazon Echo product line are now available in India, but only by invitation. This has been a common tactic by Amazon to limit Echo availability to Prime members or by invitation. This tactic enables the company to limit supply and control its early customer base but still claim presence in a market. It may also be a tactic to drive interest based on perceived scarcity. Voicebot wrote recently about how Amazon and Samsung were already targeting India and that some Alexa product trials were already underway in the country. We also predicted yesterday that Google is likely to announce an India launch at an event today. Amazon.in is promoting the invitation-only availability with a 30% off special.
Amazon Bundling Echo with One-Year Prime Membership
The Amazon Echo page for the Indian Amazon website also shows that a one-year Prime membership is included with the price of purchasing an Echo. For the 2014 U.S. Echo launch the device availability was limited to Prime members. It was a perk of membership before general availability for the devices. We see the opposite in India. The thought must be that the smart speaker market is hot and can help drive new Prime membership and ultimately renewals. A U.S. study by CIRP found in 2016 that Echo owners spent 10% more on Amazon.com after purchasing a device. In India, Echo ownership may be used to introduce consumers to Amazon Prime and drive up retail sales.
We reported earlier on analysis from 7Park Data showed Amazon in a virtual market share tie with Flipkart for mobile eCommerce sales. Increased Prime membership captured through Amazon Echo sales could help Amazon take the lead. Jeff Bezos said that Amazon Echo is not about shopping, but it is a popular feature with users.
Amazon Enters a Fifth Country
Amazon has not announced a new country for Alexa and Echo availability since September 2016. It has been more than one year since Echo expanded into the UK and Germany. You could say that Amazon Echo is really in a fourth country since Austria has been supported tacitly since the German launch and more recently that became explicit. During that same period, Google Home was launched in six countries, three of which are not supported by Amazon. At Voicebot, we believe Amazon’s Alexa expansion will be driven by synergy with geographic presence of Amazon.com. Where Amazon has a presence, expect to see Alexa. Where it does not, Alexa is likely to be absent unless people acquire the device from a supported country.
By contrast, Google has a global footprint today with its search properties and through Android OS. We expect Google to expand to large markets and where Google already has voice recognition capabilities. This may be Google’s advantage in India where it is more likely to have both English and Hindi support in the near term. Amazon Echo in India is listed at 9,999 Rupees or about US$150. The 30% discount will presumably bring this down to just over US$100. The Echo Dot is listed at $4499 Rupee or US$69.