The state and vision of video commerce
Entering a New Year is always a great time to reflect on the past while looking boldly to the future. Recently, I’ve been working on a document describing the state of video commerce. After thinking about it a bit, I decided to reproduce a summary here on the VCC blog. I am curious to hear your thoughts on whether you feel this adequately captures what video commerce is about and where it’s heading.
What’s the big deal with video?
Few would deny we live in an increasingly video-centric society. Rising broadband adoption, shifting consumer preferences, growth of video-enabled mobile devices, and the “everyone’s a producer” phenomenon reflected in the rise of YouTube are all extending the reach and impact of video in our everyday lives. Considering the trends, it is difficult to imagine a future where video plays a less prominent role in the world than it does now.
And just what is video commerce? Some new buzzword?
Video commerce is not a buzzword. It describes the marriage of video and e-commerce, a link that becomes much more obvious when one considers a few fundamental truths. As consumers, we all demand facts and figures about the products we buy, yet our human side also craves authenticity and accuracy in their portrayal. We want to see products “in real life” and feel reassured and perhaps even validated when making purchase decisions. Whether used to convey information, educate, entertain, or otherwise influence a consumer’s behavior, there is little doubt video can satisfy these basic consumer needs in ways other media cannot.
Case studies illustrate online video effectively influences purchase decisions. Many pioneering e-commerce sites employing video today see increases in product sales of 10% to 250% or more.
Still, simply placing video on an e-commerce site ignores much of the media’s potential. Video can improve search results, differentiate the shopping experience in established online channels, and drive commerce through social networks, blogs, collaboration, and other emerging channels. Far from a one act-show, video is most effective when leveraged in many places rather than in isolation.
Today, most e-commerce merchants engage in online video efforts haphazardly, if at all. Without a comprehensive understanding of video’s potential impact, it is easy to fail when crafting and rolling out a video commerce strategy.
Perhaps more fundamental, many e-commerce organizations lack access to a central library of video content to serve as the foundation of a video commerce program. Whether video is stored on isolated DVDs or supplier and customer computers, walled away in one part of the business or yet-to-be-produced, the process of accessing and deploying video content remains a central challenge impeding widespread adoption of video commerce.
The e-commerce merchants that do produce their own video most often fail to extract its full value. Since video can be implemented in so many different ways and impact so many channels, it is easy to develop a video strategy that misses the mark or only satisfies one part of the business while failing to capitalize on one of video’s most disruptive attributes – the potential for syndication and re-use.
The Vision of Video Commerce:
The vision of video commerce as outlined here will not happen in 2009. This will more likely be a year of figuring out basic strategies and the mechanics of video commerce fundamentals rather than one of executing on far-reaching visions, especially given the current economic situation. Still, I believe this vision is plausible if perhaps a bit sci-fi sounding. Here goes…
1) The “we don’t have access to enough video” problem is yesterday’s news. The vast majority of e-commerce companies are able to seamlessly and effortlessly acquire and deploy robust quantities of video content from multiple sources: suppliers, customers, shoppers, independent producers as well as self-produced video. E-commerce video production moves beyond a small niche market to become one of the core drivers of the entire e-commerce industry.
2) Video commerce is EVERYWHERE. The changes in video commerce will seem dramatic compared to now, yet it will all happen gradually in small leaps of innovation rather than all at once. From on-site merchandising video, to affiliate video, YouTube and video services, .TV sites, video search marketing, live streaming, video on mobile devices, net-connected in-store video, online video advertising, new online video channels, net-connected console games, one-to-one messaging technologies, in-car and in-flight video shopping plus interactive digital TV featuring a thousand splinters of media all serving niche audiences – e-commerce will be right there, connecting video content directly to back end order systems and shopping destinations. Mainstream online merchants will leverage video across channels old and new to build new revenue streams, accelerate existing ones, improve the customer experience, and persuade people to buy through the most immersive media ever – video – (that is, until we have widespread virtual reality for e-commerce)!
3) Video commerce is widely practiced both as an art and science. The initial focus on measurement to prove video works has given way to advanced analytics, widespread distribution, algorithmic content optimization, and integration with emerging technologies that seek to make video even more immersive, interactive, and personal – at the same time creating pervasive opportunities to shop and buy. More than anything before it, video commerce coupled with a growing trend toward an “always-connected” digital lifestyle will make e-commerce a central part of mainstream consumer life.
As content proliferates and e-commerce merchants struggle to rise above the noise, the value of creativity, differentiation, and entertainment in video commerce will explode. Competitors within a single slice of the e-commerce market will seek ever more creative ways to reach a limited pool of buyers by investing substantially in video production. Those that succeed will not only understand their customers, but connect with them in emotional ways not possible before widespread consumer acceptance of video commerce.
Regardless of whether you agree with this vision of video commerce, it is important for us all to remember that despite our shaky economy and what might prove a difficult year for many in e-commerce, video commerce isn’t just a fad – it’s the wave of the future. No matter how much the vision here may sound like science fiction, it’s nearly impossible to argue that the current trajectory of e-commerce, the rise of the Net generation, and the growing presence of video in society mean video will be much more pervasive in the future. More likely than not, we are just at the very beginning of a trend that could become a major economic force… perhaps within a single decade.
With businesses today on the lookout for new ways to extract more revenue from existing customers while reaching a dwindling population of new ones, video represents one of the few tools able to deliver the disruption necessary to win over increasingly finicky consumers. Now, let’s go make it happen!