Outside the Box: Amazon’s Alexa is about to become even more of a fixture in our lives

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While Amazon.com’s Alexa has found its way into our homes over the past few years, it mostly has been as a single Echo device that has acts as a combination alarm clock, news download, kitchen timer, and background music system.

But now Amazon AMZN, +0.55% is building a series of new devices where we can wear Alexa in our ears, over our eyes, around our fingers, and keep her (it?) in our pocket. As a result, Alexa can be affordably plugged into every room in our home, accompany us in our vehicle, become our hi-fi sound system, keep order to our daily meal planning and simplify Wi-Fi around the house.

With this expanded offering, we are going to see Alexa adoption grow fast and Amazon’s consumer data grow even faster. This will drive up Amazon’s performance, and its stock is primed to go along for the ride.

From 100 million to 1 billion

Early in 2019, Amazon touted a vague but inspiring number of 100 million Alexa-powered devices sold. Now not every one of these were made by Amazon, but all the other companies are paying to license its technology. And so now we order those Kleenex, accessories and an endless stream of unnecessariness by just saying the word. Don’t believe me? I have an extra fire pit and about 100 Clif bars I never intend to eat. Thanks, Alexa.

So don’t scoff at the idea of Alexa-powered eyeglasses or a stylish ring (Echo Loop) that you can talk to and that sends a quick jolt to let you know you have new notification. These just a few examples of the 14 new products unveiled on Wednesday.

Suddenly users will have three or four Alexa devices per person, per household, and that 100 million quickly grows to more than a billion devices, all of which track, monitor and offer immediate gratification of our every need. They will order our groceries, book our dinner reservation, play our favorite songs and more. All this will feed the data machine that enables Amazon to know even more about what we listen to, who we call, where we go to dinner, our favorite travel destinations and, well, pretty much everything.

Google GOOG, -0.27% GOOGL, -0.22%  knows our search intent—what we want to buy. Amazon will know everything.

And while not every product launched by Amazon is sure to be a hit, (See: The Fire phone), I’m sure that many of these products will be wildly successful. Many are relatively inexpensive, for between $25 and $250. The Echo Studio brings hi-fi sound to every home for a couple hundred bucks, and the Amazon EERO mesh Wi-Fi will allow you to just ask Alexa to set up a guest network. The $25 Amazon Echo Flex lets you put an Alexa in every room of your home for less than the price of a decent alarm clock.

Perhaps the only new product I’m not sure will sell in numbers is the Alexa Oven, but I could be completely wrong on that. I mean, what is it worth to be able to watch your chicken breasts cook to perfection while you run to the store to pick out the perfect bottle of wine to match?

The bottom line is Amazon is making smart home and connected lives not only possible, but also very affordable. This will lead to significant sales growth for that hardware. One forecast says 75% of U.S. households will have smart speakers by 2025.

But it is just the beginning, because we all know the key to Amazon’s success is that it knows you, the consumer, from the inside out. The expansion of the Amazon line will power the company to another level of customer insights, which will lead to greater spending by you and greater earnings for the e-commerce giant.

Amazon is about to go for an AI-powered bull run. You may want to ask Alexa to call your stockbroker before you miss the ride.

Daniel Newman is the principal analyst at Futurum Research. Follow him on Twitter @danielnewmanUV. Futurum Research, like all research and analyst firms, provides or has provided research, analysis, advising, and/or consulting to many high-tech companies in the tech and digital industries. Neither he nor his firm holds any equity positions with any companies cited.