The Future of Commerce is Shoppable Video — and it’s Already Here
Remember the dawn of ecommerce? The very concept of entering credit card details into a website was so uncomfortable, retailers felt it would never catch on. Then Amazon happened, with a slick user experience and customer reviews that provided all-important social proof. Gradually, shoppers came to trust online shopping. Today ecommerce sales in the U.S. alone are closing in on $1 trillion annually.
But what’s the experience like? If you need something like AA batteries, you might head straight online: a quick, commodity purchase. But if you really want to be inspired, or discover the story of an item’s provenance, or get up close to see it from all angles, the online channel struggles to deliver. There’s a qualitative difference between buying and shopping, and the secret weapon for retailers that want to deliver that differentiated experience online is shoppable video.
Shoppable Video Lets Brand Marketers Shine – and Attribute the Sale
The best brands are geniuses at using video to tell stories that make everything from shoes to toothpaste sound amazing. But for years, there’s been a gap between telling the story and securing a sale. Video ads have been part of a drawn-out sales funnel, and it’s hard to attribute a purchase to a commercial seen on TV (or online for that matter, now that privacy laws and technology are maturing).
Shoppable video collapses the sales funnel to zero and makes attribution crystal-clear. If you haven’t seen it in action, shoppable video is simply a pre-recorded or live video online, where customers tune in to discover interesting products. You can think of it as a show that people watch specifically to shop.
A superb example is the recent Stranger Things Day video shopping event. In November 2022, QVC and Netflix teamed up for four original streaming shopping events, including two livestreams. Viewers tuned in to watch the host, Tessa Notting, as she toured a Stranger Things set and showed off themed merchandise. All products were available to buy right from the video itself.
‘Half my money on advertising is wasted’
Shoppable video events like these are where we see ecommerce going, because of their ability to deliver. You’ll remember the adage about the trouble with advertising: half of spend is wasted, but you don’t know which half. Brands are discovering that shoppable video erases that uncertainty.
They can deliver content that creates the desire to purchase, and convert that emotion immediately to a sale. For livestream shopping, conversion rates are especially strong — up to 10 times more than with standard ecommerce, according to McKinsey Digital.
Combined with the potential for more informed purchases and reduced returns, these drivers are especially important in the wake of privacy-focused changes in the digital advertising landscape. Retailers that lower their reliance on cookies that track shoppers across the internet, and instead look to the pulling power of their own video content, will increasingly have a strategic advantage.
What’s Next for Video Commerce?
Those of us who’ve been in the industry a long time are seeing ecommerce begin to evolve away from its original, static self. It’s energizing to see the genuinely engaging experiences that are now possible, where brand stories are the focus, thanks to interactive video.
Video commerce can be thought of as the newest generation of ecommerce. Video commerce, or v-commerce, falls into two main types. Livestream shopping — short live shows with direct engagement like “hearting” and live chat; and shoppable video, which encompasses livestream shopping, and also includes pre-recorded videos and replays of live shopping events. In all cases, shoppers get to view engaging videos about products (and make those all-important purchases), but only livestreams happen in the moment.
Live videos are uniquely attractive because viewers can interact with the show. Video is transformed from a one-way viewing experience to a two-way shopping experience. Live chat lets the audience ask questions about the product, and hosts’ answers can provide the clarity that turns even more viewers into buyers.
Yes, it can be intimidating for brands to go live — Will the host perform well? How do we manage unexpected comments from the public? — but with an experienced partner to help navigate this new landscape, we predict that brands will find their feet and make livestream shopping a regular part of their marketing mix in 2023, and beyond. Coresight Research has estimated that U.S. livestream shopping will quadruple over 2020 levels to be worth $35 billion by 2024.
The big draw isn’t just that instant conversion, but the ability for retailers to host the experience on their own platforms, with a direct connection to consumers, and full control over data, trust and privacy.
The digital landscape is evolving at an ever-faster pace, and change is hard. For brands that are looking to make a bold move into video commerce in 2023, the time is right.
