We Ran HomePod Through the Smart Speaker Gauntlet

Conclusion. Yesterday, we put HomePod through the smart speaker gauntlet which included 782 queries along with comprehensive tests of sound quality and ease of use. Our methodology was comprised of 3 HomePods being tested throughout the day by the Loup Ventures team. Here are four key takeaways.

  • HomePod is hands down the best sounding smart speaker.
  • As a smart speaker, it answered 52.3% of queries correctly compared to recent tests of Google Home at 81%, Alexa at 64%, and Cortana at 57%.
  • The user experience of HomePod is measurably better than its competition (setup, communication style, listening ability).
  • We have added HomePod to our Apple financial model. For CY18, we’re expecting HomePod unit sales of 7 million (12% global smart speaker market share) with a $349 ASP, which adds approximately 1% to revenue and earnings. In CY19, we expect unit sales of 10.9 million, which adds just over 1% to our model. While only factional revenue contribution, we expect HomePod units to grow between 40% and 45% per year over the next 3 years. Link to model here.

Query results. Siri understood 99.4% of queries and answered 52.3% of them correctly. This places HomePod at the bottom of the totem pole in terms of AI assistant performance. Siri is particularly strong in Local (where can I find a good cup of coffee around here?) and Commerce (help me buy some new shoes.) queries, handily beating Alexa and Cortana, but still falling short of Google Home in those areas. Overall, Siri performed above our expectations given the limited scope of HomePod’s music focus.

Adding domains will quickly improve Siri’s score. Some domains like navigation, calendar, email, and calling are simply not supported. These questions were met with, “I can’t ___ on HomePod.” Also, in any case that iPhone-based Siri would bring up Google search results, HomePod would reply, “I can’t get the answer to that on HomePod,” which forces you to use your phone or give up on the question altogether. Removing navigation, calling, email, and calendar-related queries from our question set yields a 67% correct response, a jump from overall of 52.3% correct. This means added support for these domains would bring HomePod performance above that of Alexa (64%) and Cortana (57%), though still shy of Google Home (81%). We know Siri has the ability to correctly answer a whole range of queries that HomePod cannot, evidenced by our note here. Apple’s limiting of HomePod’s domains should change over time, at which point we expect the speaker to be vastly more useful and integrated with your other Apple devices.

Other observations

  • HomePod has superior listening skills to other smart speakers. This is partly due to a noise cancellation feature which allows you, even at a volume where you would have to raise your voice to talk to others in the same room, to use your regular speaking voice with Siri. This was HomePod’s most stellar feature.
  • Wireless setup was super easy. In fact, it was the easiest of any of digital assistant we have used (Alexa, Google Home, Cortana, etc.). You already have a companion app and don’t need to wrestle with wifi networks.
  • Siri’s voice sounds smoother and more human than it does on your iPhone.
  • Her communication is also more human-like. Specifically, after asking a question, she does not repeat the whole thing back to you as is the case with Google Assistant and Alexa, which makes for a subtly smoother process.
  • The tap UI on the touch-sensitive display requires a small amount of instruction, as it is not immediately obvious that you tap to play.pause, double tap for next track, triple tap for previous track, and touch and hold to bring up Siri.
  • HomePod’s packaging is a new level of perfection for Apple. The perfectly fitted box requires you to open it at “reveal” pace, and even the external plastic wrap is pleasing to remove.
  • As a speaker, it sounds incredible – mission accomplished. As a digital assistant, whether it is a direct competitor or not, it is better than what we expected for version 1, but still lags behind Alexa and Google Home.

Survey suggests demand for HomePod similar to Apple Watch. Last week we surveyed 500 people in the U.S. and found 3.3% said they would purchase a HomePod in the next year. Among those surveyed who already own an Apple product, 5.2% planned on buying a HomePod. This is similar to 7% of Apple product owners planned to buy an Apple Watch ahead of its launch in Spring of 2015 (survey was conducted in December of 2014, four months ahead of the Apple Watch launch). While Apple does not disclose Watch unit sales, we estimate in its first 12 months Apple sold 10.2m Watches at an ASP of $475. This compares to our first 12 months of HomePod sales estimate of 7m units with an ASP of $349.

Smart speaker market share. We see Google Home as the long-term smart speaker unit share winner, but Alexa and Apple as the two other key players. In 2018 we expect HomePod will capture 12% of the global smart speaker units, compared to our estimate of Alexa at 52% share, Google Home at 32% and others at 4%. In 2022, we expect HomePod will hold a similar 12% market share (HomePod ASP estimate declines to $149 from $349 today), Google Home at 48% and Alexa at 37%.

Apple’s grander vision around HomePod.  Don’t be fooled by HomePod’s sound quality-focused first step into smart speakers; Apple has a grander vision than delivering a better sounding Echo. While not present in the first version of HomePod (i.e. you can’t even make a phone call with HomePod), we believe Apple’s goal is to make Siri a ubiquitous, ambient presence that connects and controls all your connected devices and services – and to make a leap forward in the transition to voice-first computing.

The way humans interact with computers is changing. Today, we use our keyboards, mice, and touchscreens to interact with computers, but in the future, we’ll simply rely on our voice, gestures, or even our thoughts. Voice is quickly becoming a preferred interface. Apple’s device ecosystem delivers a frictionless experience, which will only get better with the adoption of voice and with the addition of HomePod supported domains (9 supported domains today). Interestingly, Apple has included an A8 chip in its HomePod, the same chip included in an iPhone 6. The A8 chip is much more powerful than the chips competing home assistants run on, which poses the question: what else is Apple planning with the HomePod?

Disclaimer: We actively write about the themes in which we invest: artificial intelligence, robotics, virtual reality, and augmented reality. From time to time, we will write about companies that are in our portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making investment decisions. We hold no obligation to update any of our projections. We express no warranties about any estimates or opinions we make.

Google Stays Focused on AI Theme

AI-First. We start with artificial intelligence, as Sundar has done the last five consecutive quarters. He continues to make it more than apparent that AI is essential to Google’s vision and will be a key component of their products and services. AI topics like Google Assistant, Waymo, AutoML, and AI-first hardware were highlighted on the call, but financial metrics like TAC overshadowed. Here is a look at Sundar’s opening remarks of the last five earnings calls.

  • Dec-17 (today) – “Thanks, Ruth. Our teams are off to a great start in 2018 (omitting 6 lines) Technology is an incredibly dynamic industry. We have been laying a foundation for the next decade as we pivot to an AI first company powering the next generation of Google products like the Google Assistant.”
  • Sept-17 – “Thank you, Ruth. We had another great quarter. (omitting 1 line) Even though we are in the early days of AI, we are already rethinking how to build products around machine learning. It’s a new paradigm compared to mobile first software, and I’m thrilled how Google is leading the way.”
  • Jun-17 – “Thanks, Ruth. We had a phenomenal quarter. Google continues to lead the shift to AI-driven computing.”
  • Mar-17 – “Thanks, Ruth. It’s been a terrific start to the year. (omitting 10 lines) Now, turning first to machine learning and access to information. I’m really happy with how we are transitioning to an AI-first company.”
  • Dec-16 – “Thanks, Ruth. 2016 was a great year for Google and 2017 is shaping up to be even more exciting. (omitting 11 lines) First, machine learning and access to information. As I’ve shared before, computing is moving from a mobile­first to AI­-first with more universal, ambient and intelligent computing that you can interact with naturally, all made smarter by the progress we are making with machine learning.”

Cloud. Google’s cloud business is gaining momentum as the world’s fastest-growing major public cloud provider. It is now a $1B per quarter business, but it still dwarfed by AWS revenue of over $5B per quarter. Sundar says the momentum is coming from their efforts to be enterprise scale ready. “Now we can handle any type of enterprise,” he says. We expect Google’s Cloud business to continue this growth in market share.

Hardware. As the largest contributor to “other revenue,” and with 2000 new HTC engineers, hardware is becoming increasingly important to Google. Hardware shipments “doubled” this quarter which means sales of Google Home and Pixel 2 have been strong. Further, when asked about monetizing the voice platform around Google Home, Sundar said they will remain focused on the user experience rather than monetization for “some time.” This means we can expect an ad-free experience for the foreseeable future. We think Google Home’s superior AI will lead it to steal market share from Alexa in the coming years.

Waymo. Waymo was brought up several times, but details about the recent order for vehicles from Fiat Chrysler and timing on fleet deployment were danced around. Nonetheless, the excitement from Ruth, Sundar, and analysts was palpable. We expect Waymo to be the first to bring a widespread fleet online and will be tuning in to see how early deployments play out in Phoenix.

Buzzword Bingo. Over the same five quarters, we tracked how many times presenters and analysts made comments artificial intelligence by tallying instances of AI jargon (AI, artificial intelligence, machine learning, TensorFlow, natural language processing, etc).  This is evidence of the intensity level at which Google is pursuing AI.

Disclaimer: We actively write about the themes in which we invest: artificial intelligence, robotics, virtual reality, and augmented reality. From time to time, we will write about companies that are in our portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making investment decisions. We hold no obligation to update any of our projections. We express no warranties about any estimates or opinions we make.

8 Tech Predictions for 2018

Loup Ventures’ predictions of 2018:

  1. AI theme continues and artificial general intelligence takes small step forward through Google’s “Deepmind” initiative.
  2. VR gets untethered but it still takes another year to take off.
  3. Google Home continues to gain market share in smart speaker market.
  4. Tesla Model 3 production ramps from 2,500 in 2017 to greater than 150,000 in 2018.
  5. Major automakers announce expanded electric vehicle line-up, but autonomous driving will not ramp up until 2021.
  6. Bitcoin pulls back.
  7. iPhone ASP’s $740 vs. Street at $710.
  8. Amazon will acquire Target.

AI theme continues and artificial general intelligence takes small step forward through Google’s “Deepmind” initiative. We believe the hype around AI is justified given it’s hard to understate the significance that AI will have on the future. In 2018 we expect the AI momentum to continue. In July of 2017, we counted 11% of Fortune 500 companies mentioned AI on their quarterly conference calls. We expect that number to grow in 2018. As for leaders, it’s clear that Google CEO Sundar Pichai is trying to get his point across: AI is the future of Google. We went back and looked at his opening comments over the last year and found he has led his prepared remarks by asserting Google’s evolution from a mobile to an AI-first company on each of the past four earnings calls. The company is pushing its AI into hardware devices (Google AI hardware note) and seeing its work pay off (Google Home’s the smartest smart speaker). Artificial narrow intelligence (ANI) is being mastered and we expect more news about the next frontier in AI, artificial general intelligence (AGI, the ability of a machine to think like a human), to be top of mind in 2018. We expect Google to play a thought leadership role in AGI with its Deepmind platform, but keep in mind true AGI is likely another 20 years away.

VR gets untethered but it still takes another year to take off.  The Wall Street Journal said it best in their Dec 30 article titled “Virtual Reality Needs to Cut the Cord”.  Oculus Go ($199 untethered) which comes out early in 2018 will be a step forward in ease of VR use, but it won’t be until 2019 until more powerful untethered hardware lay the groundwork for content developers and consumers to fully embrace VR. For those disappointed VR won’t be mainstream in 2018, you can at least look forward to Ready Player One’s release on March 30th. Here’s our Facebook in VR outlook.

Google Home continues to gain market share in smart speaker market.  In 2017 the smart speaker market was led by Amazon with the release of 3 new Echo devices (Echo, Echo Plus, Echo Spot), Alexa for Business, sub $50 pricing, and the Alexa app being the #1 downloaded app on Christmas Day vs. Google Home at #6 across Android and iPhone. That said the market is still up for grabs, as evidenced by Amazon and Google collectively spending more than $70m on TV ads from Thanksgiving through Christmas to push the theme. Despite Alexa owning 75% (Loup Ventures) of the global smart speaker market today, we expect in 2018 Google Home will be a share gainer in smart speakers given its performance lead. Here are the details of our recent face off between the smart speaker players.

Tesla Model 3 production ramps from 2,500 in 2017 to greater than 150,000 in 2018.  Near-term, we expect another miss in Model 3 production, but in 2018 we predict production will turn the corner. We continue to stress that Model 3 production over the next several quarters will be largely a guessing game and that short-term production numbers do not materially affect the long-term story. The last update on Model 3 production calls for “a production rate of 5,000 Model 3 vehicles per week by late Q1 2018,” which we believe is ambitious. That said, we’re encouraged by hundreds of Model 3s have been spotted at delivery centers and at the Fremont factory shown in a video here, along with several suppliers reporting that they are back to delivering Model 3 parts at volume.

The reason we remain upbeat on the Tesla story despite the prolonged Model 3 production problems is that EV and autonomy are the future. Tesla is fighting to gain production scale to create that future. While other car manufacturers build gas-powered vehicles at scale, building autonomous EVs is a vastly different process that will require traditional auto manufacturers to re-engineer their production facilities. That means every automaker that wants to compete in the future needs to go through the production pain Tesla’s experiencing today. Here’s our recent note on Model 3 production outlook.

Major automakers announce expanded electric vehicle line-up, but autonomous driving will not ramp up until 2021. 2018 will likely be the year of announcements around expanded EV lineups from traditional automakers. The Detroit Auto Show (Jan 13-28th) is an obvious window for these announcements and we expect a steady drip of EV model announcements throughout the year. We don’t believe these new vehicles will be available until 2019 or 2020. The autonomy theme will be equally top of mind in 2018, lead by likely updates from Apple around their autonomous shuttle project. We continue to expect 2021 as the year autonomy begins to ramp, and our bet is Waymo, GM’s Cruise, and Tesla will be first to market.  Here’s our autonomous vehicle industry model.

Bitcoin pulls back. We feel cryptocurrencies are in a bubble, but something can be in a bubble and still over time become a foundational technology, just like the internet. Those who jumped on history’s greatest “get rich quick” event enjoyed 1409% increase in value in 2017 as the world watched a coin formerly synonymous with the “Silk Road” break into Wall Street. We believe that blockchain technology and cryptocurrencies are here to stay and represent the future of storing value, however, we anticipate that increased oversight (banking and government), speculation amongst institutional investors along with operational difficulties on trading platforms will trigger a crypto sell-off in 2018.  Here’s our recent Bitcoin outlook note.

iPhone ASP’s $740 vs. Street at $710. We remain optimistic that iPhone units in FY18 will be inline with the Street (~242m up 12% y/y), but the mix of iPhone X will exceed Street expectations and have a higher ASP of $740, up 13% y/y compared to the Street ASP of $710. Our ASP estimate is based on a 30% mix of iPhone X and iPhone 18% mix of iPhone 8 (iPhone 8+ and iPhone 8). In a typical iPhone cycle, the newest phone represents about half of the mix, in line with our FY18 outlook of a 48%new phone mix. Here’s our recent note on why we remain comfortable with our iPhone estimates.

Amazon will acquire Target. We saved our boldest 2018 prediction for last, Amazon acquiring Target. Getting the timing on this is difficult, but seeing the value of the combination is easy. Amazon believe’s the future of retail is a mix of mostly online and some offline. Target is the ideal offline partner for Amazon for two reasons, shared demographic and manageable but comprehensive store count. As for the demographic, Target’s focus on moms is central to Amazon’s approach to win wallet share. Amazon has, over the years, aggressively pursued moms through promotions around Prime along with loading Prime Video with kid-friendly content. As for retail stores, Amazon’s acquisition of Whole Foods 470 stores along with testing of the Amazon Go retail concept is evidence that Amazon sees the future of retail as a combination of mostly online and some offline. Despite gaining Whole Foods, Amazon’s ~470 store presence still dwarf’s Walmart at 11,695 (global).  If Amazon acquires Target’s that would jump its store count to about 2,300.  As for anti-trust, the Trump administration won’t do any favors for Jeff Bezos, but the market share numbers suggest the deal will be approved. Walmart will reach about $315B in U.S. sales in 2017 (total 2017 Walmart is expected to be $500B, up 2.6% y/y), and Amazon North American ($105B in 2017 up 31% y/y) and Target ($71B, up 2.4% YoY) would equal about $176B in U.S. revenue. Looking at the top 18 U.S. retailers (including grocery), Walmart has about 23% share and an Amazon/Target combination would have about 13% share. Lastly, Amazon can afford Target. If you assume they pay a 15% premium to the current TGT trading level would imply a take-out valuation of $41 billion, about 8% of the value of Amazon’s current $564 billion market cap.

Disclaimer: We actively write about the themes in which we invest: artificial intelligence, robotics, virtual reality, and augmented reality. From time to time, we will write about companies that are in our portfolio.  Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making investment decisions. We hold no obligation to update any of our projections. We express no warranties about any estimates or opinions we make.

Face Off Part 3 – Echo vs. Google Home vs. Cortana

We tested the Amazon Echo, Google Home, and Harman Kardon Invoke (powered by Microsoft’s Cortana) smart speakers, each with 800 queries, and found that Google Home answered 81% of the questions correctly vs. Echo at 64% and Cortana at 56%.

Did Santa bring you a smart speaker? Smart speakers are quickly becoming one of the most common consumer uses of AI thanks to aggressive pricing and marketing from companies like Amazon and Google. We’ve conducted our latest round of queries, designed to test the full range of abilities and accuracy of a given AI assistant. Our conclusion: home assistants aren’t just gaining popularity, they’re making drastic improvements quickly. Here is what you can expect from the smart speaker that you unwrapped yesterday.

Methodology. Just as we have in February and August of this year, we asked 800 questions to the Amazon Echo (2nd generation this time around) and Google Home. We added the Harman Kardon Invoke speaker, coupled with Microsoft’s Cortana assistant, to our evaluation. The queries covered five categories: Local, Commerce, Navigation, Information, and Command. The smart speakers were graded on two metrics: did the device understand what was asked? (this can be seen on the device’s companion app), and did it answer or execute correctly? It is important to note that we have slightly modified our question set to be more reflective of the changing abilities of AI assistants. As voice computing becomes more versatile and smart speakers become more capable, we will continue to update our question set to be reflective of those improvements going forward. Our changes included questions around the use of smart home devices. We tested each of the speakers with the Philips Hue smart lighting and Wemo Mini smart plugs.

This round, Google Home was the decisive winner, answering 81% of questions correctly vs. the Echo’s 64% and the Invoke’s 56%.  On average, the speakers understood what was being asked 99% of the time. This is a jump up from 95% in August and means that these assistants’ natural language processing has improved to correctly understand, apart from a few anomalies, everything you say. Whether or not it correctly executes your request varies widely between devices and categories.

Results. Google Home continued its outperformance with the top score in each of the five categories. The Invoke, powered by Microsoft’s Cortana, scored more or less in line with the Amazon Echo – an impressive feat considering its tiny market share and comparatively short time in the hands of users. The Echo made considerable improvements in several categories, most notably navigation, while remaining relatively flat in areas like commerce and local.

Improvement across the board. We continue to be impressed with the rate at which these AI assistants are improving. Since our first test in February, the total number of correct responses has increased by 29% for the Echo and 42% for the Google Home. Cortana, which we tested in April on a Microsoft Surface Book, has improved 8%. In less than a year we have noted remarkable improvement in every category and can only expect this level of progress to continue as adoption grows and user base expands. Google Home, however seems to be on the steepest improvement curve. One would expect Google to dominate the information category with its unprecedented access to search data, but its outperformance in categories like commands, navigation, and even commerce furthers the case, in our minds, for Google Home to steal market share away from Alexa going forward.

New features emerge. During our testing, we noticed several minor, but encouraging enhancements to the voice computing experience, namely connectivity to both other devices and other services. Excluding the Echo, when you ask for navigation information, Google and Cortana will send directions to your phone either through a push notification or the companion app. Hailing a ride through Uber was smooth on both the Echo and Google Home. The Google Home could also hand you off to a designated EBay assistant to shop for used goods. We were impressed with improvements around media services like Spotify and smart home capabilities using both lights and smart switches.

Google takes a commanding lead in commerce. Google Home correctly answered 72% of commerce questions, as opposed to 42% and 15% for the Echo and Invoke respectively. This is an area that is thought to be dominated by Amazon. However, Google’s recent anti-Amazon partnerships with retailers like Target and Walmart to make voice-based commerce more accessible pushed the Google Home ahead of other assistants. This was the Google Home’s largest area of improvement, correctly answering 34% more queries than it did in August. 

Sound quality. Overwhelmingly, smart speaker owners use them to call up and listen to music. According to Quartz data, 74% of owners play music through their smart speakers, more than asking for weather and basic info. Of the devices we tested, the Harman Kardon Invoke sounded the best; the Google Home and Echo are very similar, but are not focused on premium sound quality. For this mid-tier price range (sale prices – Google Home: $79, Echo: $79, Invoke: $99) the Invoke sounds best. Great sounding music, however, is less defensible than the AI itself. A useful assistant can be loaded onto a tiny speaker like the Echo Dot and Home Mini, or a premium speaker as we have seen with the Alexa-enabled Sonos One, Google Home Max, and the incoming Apple HomePod. It becomes clear that you are paying almost exclusively for sound quality.

Still not mainstream. Despite our comprehensive question set, the everyday user rarely extends beyond simple queries like asking for the weather, general knowledge questions, or requesting a song. In fact, 65% of Alexa users have not even enabled a skill. In order for voice computing to take hold in the home and beyond, there needs to be improvement in terms of connectivity with other devices like phones, laptops, and televisions. We did note much better connection to your phone via companion apps, your television via devices like a Chromecast of Fire TV, and better control of smart home applications, which is an encouraging sign. A short list of persistent issues keeps smart speakers in the camp of tech gadget instead of essential device (like a phone or computer), but at the rate of change we are observing, we remain confident that AI assistants, in time, will become an integral part of how we interact with computers.

Disclaimer: We actively write about the themes in which we invest: artificial intelligence, robotics, virtual reality, and augmented reality. From time to time, we will write about companies that are in our portfolio.  Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making investment decisions. We hold no obligation to update any of our projections. We express no warranties about any estimates or opinions we make.

2018 Market Outlook: Who’s Winning in AR & VR?

Written by guest authors Lindsay Boyajian, Product Marketing, and  Zack Kadish, Professional Services at Conductor.

For the past few years, we’ve seen the buzz around AR and VR build. All the major players from Amazon to Apple to Snap have made investments in the space. Funding for VR and AR startups, according to TechCrunch, has amounted to $2.1 billion this year in at least 217 companies in the AR and VR space.

However, is it all just hype? Is consumer interest really growing? Which brands and publishers have the most market share?

This report examines organic search data from Conductor to realize insights into consumer behavior and brand market share. The Conductor Searchlight platform tracked thousands of the most relevant, high-volume search terms that consumers used to find products, services, and information in Q4 2017 related to AR and VR.

Search market share indicates which brands and publishers own the top positions in search results. This data is invaluable because search behavior is a strong indicator of consumer buying intent. It provides insight into what brands, products, and services consumers are interested in.

The insights in this report highlight trends in AR and VR that will influence growth and adoption in 2018. It has category breakdowns to provide a better understanding of who’s dominating by product category and purchase journey stage.

Is AR or VR winning?

For years, VR was the rising star, overshadowing its cousin AR. But the tides turned in 2016 when experts began hailing the potential of AR. In September 2016, Apple CEO Tim Cook said, “My own view is that augmented reality is the larger of the two [VR & AR], probably by far, because this gives the capability for both of us to sit and be very present talking to each other, but also have other things visually for both of us to see.”

There are 30 times more searches related to virtual reality than augmented reality per month.

Despite the changing tides, VR is still leading among consumers. There are 30 times more searches related to virtual reality than augmented reality per month. Searches related to VR gaming are dominant, indicating that is where consumer interest lies today.

Search terms related to business applications of both VR and AR are negligible. For instance, “virtual reality in architecture” has a monthly search volume (MSV) of 320 and “augmented reality for healthcare” an MSV of 10. Neither technology is winning when it comes to owning the customer mind share for enterprise applications.

Which brands and publishers control organic market share?

Who owns market share for search terms related to VR & AR?

Who owns market share for search terms related to VR?

Who owns market share for search terms related to AR?

When we look at tracked searches related to virtual reality, publishers are dominant with some retailers, related to gaming (Playstation, Amazon, and Steam), capturing market share as well.

In comparison, publishers exclusively dominate tracked searches related to augmented reality. There are no retailers that have significant market share.

We also find that the majority of available market share is still unclaimed, represented by the large “other” slice. This indicates opportunity for late entrants to capture organic market share.

Are consumers ready to invest in AR & VR?

There are 5 times as many searches related to early stage intent compared to late stage. The searches are both more informational and comparative based (Early Stage and Middle Stage), rather than transactional (Late Stage). This suggests consumers are information gathering, rather than looking to buy a product or solution.

If we look at each technology individually, there are more transactional terms related to virtual reality than augmented reality. This indicates again that VR is winning when it comes to customer purchase intent.

What strategies can brands and publishers use to capture unclaimed market share?

Brands and publishers should consider optimizing their content for universal result types. 41% of all the tracked searches have video results. Given that most customers are searching for early stage content, brands and publishers should create early stage video content that answers questions like “how to” and “what is”.

Similarly, 30% of all the tracked searches have Google answer boxes, suggesting brands and publishers should optimize their content for answer boxes. Answer boxes are the search result features that appear at the top of the organic results in a Google Search.

When it comes to what topics to write about, the search data suggests there is opportunity to create content around transactional (Late Stage) search terms. These queries have relatively high search volume, but not a lot of high quality content relating to these topics. Creating content answering transactional queries is recommended.

Finally, as we have seen, publishers outperform manufacturers and brands in most categories— suggesting that it’s an ideal entry point for other brands and retailers. By contributing content or advertising on publishers that have high visibility, brands can also make a play to win market share.

The organic search data in this report comes from Conductor. For more, follow Lindsay Boyajian and Zack Kadish on LinkedIn.

Disclaimer: We actively write about the themes in which we invest: artificial intelligence, robotics, virtual reality, and augmented reality. From time to time, we will write about companies that are in our portfolio.  Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making investment decisions. We hold no obligation to update any of our projections. We express no warranties about any estimates or opinions we make.