Imagine scrolling through social media to see that your favorite brand has posted a new video about their customer’s favorite products of 2022. You start watching the video and quickly realize that it’s interactive. As different products pop up on the screen, you can click them to see more information and even make a purchase in the moment if you want. The video pauses every time you click a link, so you don’t miss what’s next. You don’t need to go to another website or another app, but you can make your purchase right there within the video. It’s entertaining, engaging, and educational. You finish the video and continue scrolling on social media, delighted with your new shopping experience and excited about your new item coming in the mail.

This is what it is like to interact with a shoppable video. As e-commerce progresses, consumers have a greater desire to engage with personalized, entertaining, and convenient shopping experiences. “Shoppertainment” is a term used to describe unique in-store shopping experiences that allow customers to do more than just view the products on display. Think of IKEA, a retail brand that sets up its store as if you are walking through a living room or bedroom, showing their customers what their products could look like in reality. Shoppable videos are another form of ‘shoppertainment’ that displays products in an interactive way. What are shoppable videos, and how do they help brands boost sales and build meaningful relationships with consumers?

What is a Shoppable Video?

A shoppable video is a marketing tool that presents retail products via an entertaining video and makes them available for purchase through embedded links. Viewers can click these links as they pop up throughout the video. When a link is clicked, viewers are able to purchase the product without leaving the video page. Shoppable videos simplify the consumer journey, enhance customer engagement, and improve sales.

There are two ways brands can produce shoppable videos: live or pre-recorded. Brands can make their products shoppable through livestreaming to an audience, also known as “live shopping.” As business owners or influencers present their products in real-time, viewers are encouraged to purchase products directly from the livestream’s links. The audience can even ask questions about products and receive answers through the live video. Video hosts can call out usernames they see in the live chat to get people more involved. Live shopping is an entertaining way for business owners, employees, or influencers to interact and build meaningful relationships with their customers. Although this concept is slowly gaining traction in North America, it is a well-established shopping experience in China. Live shopping is projected to be a $480 billion industry in China this year and only $11 billion in the United States. In 2023, those numbers are projected to jump significantly. In China, it is estimated that live shopping will account for 19.4% of sales in China, sitting at $600 billion. In the United States, it is estimated that it will grow to $25 billion. These are considerable numbers that provide a glimpse into the future of live shopping and its impact on the retail industry.

Walmart, for example, launched a live shopping option where influencers and industry leaders can host shoppable livestreams featuring different products and brands. Buzzfeed hosted a livestream via Walmart titled “Everything You Need for an Epic Tailgate”. The hosts take viewers through a list of everything a tailgate party host needs for a successful gathering, with all the products being available for purchase through Walmart during the livestream. With this livestream, Walmart was able to highlight specific barbeque products. Through this live shopping initiative, they are able to host multiple livestreams per week that feature a variety of products including skincare, cosmetics, baby food, or back-to-school materials. They attract viewers by having hosts like TikTok sensation Chloe Mitchell or pop star Willow Smith. This displays how large retailers can integrate live shopping into their sales strategy through creative partnerships.

Brands can also make pre-recorded shoppable videos that act as ads, live on their website, or as posts on their social media platforms. Pre-recorded shoppable videos can be shoppable livestreams that are posted once they’re finished, or they can be pre-planned and professionally edited to act more as an interactive commercial. This type of shoppable video is also gaining popularity in North America. In July 2022, Shopify announced a new partnership with YouTube allowing merchants to sell to customers through posted videos. Ever seen the hashtag #TikTokMadeMeBuy? Reaching 19 billion views, this hashtag allowed TikTok to push forward new shoppable ad formats such as video shopping ads. Social media platforms are making space for brands to produce shoppable videos for their users.

Look at Wayfair, an online furniture and home goods store that produced a shoppable video that walked viewers through different areas of a family’s home. Each set featured one of their products with a clickable link for an option to purchase the product. Through this pre-recorded shoppable video, Wayfair displays how a typical commercial can be transformed to both simplify the customer journey and invite consumers to become participants.

Benefits and Challenges of Shoppable Videos

Benefits

Live and pre-recorded shoppable videos offer a unique way to present products and engage with consumers. In this digital era, shoppable videos allow brands to have a competitive advantage that stands out amidst the noise and draws customers in. B2B e-commerce sales are projected to reach over $1.67 trillion this year, showing that unique digital advertising will become more and more crucial for how brands engage their customers.

One clear benefit of shoppable videos is that they simplify the digital customer journey. A typical customer journey would look like seeing and clicking on a social media ad, redirecting to a website, searching for a product or multiple products, adding them to the cart, inputting payment information, and finally, completing the purchase. With shoppable videos, customers can perform each of those actions directly on the video without ever having to leave the video. The simplicity of the purchase journey that shoppable videos offer is appealing to customers.

Another benefit of shoppable videos is that they are inherently engaging. The audience is invited to participate in the video through actions such as commenting and asking questions during a live shopping segment, or by clicking on a linked product in a video to make a purchase. The idea is that brands can display their products in creative ways that appeal to the consumer’s needs. For example, a makeup brand could host a live shopping event where they have multiple people with various skin tones try on lipstick that correspond with their coloring. Audience members watching could get involved by commenting requests of certain lipstick colors, and they could be moved to purchase a particular lipstick after seeing someone with a similar skin tone try it on. Alternatively, a watch brand could style different watches for a variety of occasions, showing how a watch could fit into someone’s wardrobe for casual outfits, formal outfits, or business casual outfits. Each watch for each outfit would have a clickable link that shares more about the design, price, and story behind the product, as well as an avenue for purchase. Shoppable videos create an engaging space for consumers to imagine how products could fit into their lifestyle and allow them to participate. Because shoppable videos invite engagement from consumers, there is a higher likelihood of consumers becoming loyal customers if they’re shopping experience was simple, smooth, and entertaining.

Lastly, shoppable videos help brands improve their conversion rates and overall sales. Globally, e-commerce retail sales account for almost 20% of the retail industry. This is projected to rise to just under 25% by 2025. Shoppable videos raise viewing time by 47%, and have a conversion rate of around 11%. For reference, the average conversion rate for Google ads is 3.48%. With more companies like Amazon, TikTok, Meta, and YouTube investing lots of energy into e-commerce, shoppable videos will continue to be a way for brands to stand out and boost sales. This marketing tool is convenient, entertaining, and invites consumers to participate, which draws individuals who are engaged and ready to purchase.

Challenges

Although there are plenty of benefits to be gained from shoppable videos, they must be produced correctly to reap those benefits. One of the main challenges with shoppable videos is there is a risk of the user experience being compromised. Some issues that have been prevalent in shoppable videos included a lack of clarity for where to click, wrong or broken links, being directed away from the video, no clarification of which items are shoppable, or the video moving too fast. If consumers have a negative experience with a shoppable video, they are less likely to engage with your brand or its future videos. This is why it is crucial to ensure shoppable videos are thoroughly tested before they are launched.

Another challenge with shoppable videos is that they are a common marketing tool in North America. While they are a popular form of digital marketing in China, North America is slower to adopt this e-commerce strategy. This may mean that your brand’s audience isn’t ready to engage with your shoppable video, and it may not be as successful as you anticipated. Thankfully, shoppable videos can be affordable to produce, as they can be shot with a phone. They can also be created with free social media platforms like Instagram or TikTok whcih means there is a low cost to effort ratio if the video doesn’t generate the projected sales.

Best Practices for Creating a Shoppable Videos

To avoid creating a poor user experience on your first shoppable video, here are a few best practices to follow.

Start with a Hook

Make sure you don’t wait too long to introduce links in your shoppable video. Your audience may move on if you don’t provide a shoppable link within the first few seconds of the video.

Go Slow

Consumers want to see your products! Ensure product shots linger long enough to give your audience a good look at what the product is and leave adequate time for them to click the links.

Be Clear

Make sure that you let your audience know that the video is meant to be interactive. If necessary, take a few seconds to teach consumers how to click the links that pop up.

Be Focused

Only highlight a few products throughout your video. You don’t want to overwhelm consumers with too many options. Fewer products per video gives people time for meaningful consideration.

Create Shoppable Videos Based on First-Party Data

Shoppable videos are a unique, interactive marketing tool that brands can use to creatively engage their consumers. As purchases can be made within the video, marketers can use this tool to simplify the customer journey and improve conversion rates. Additionally, shoppable videos are a fun way for brands to build meaningful relationships with consumers, providing more opportunities for building customer loyalty.

As shoppable videos gain prominence as a marketing tool in North America, it is important for brands to know who their customers are and how to target them. 3 tier logic’s PLATFORM³ leverages first-party data to reach consumers through short-term marketing promotions and full-scale loyalty programs. Modules like Data Capture & Analytics, Contests and Promotions, Points and Gamification, and Dynamic Messaging give marketers the tools and information they need to guide their decisions and develop stronger consumer relationships. To learn more, chat with an expert today.

Shoppable Videos: The Future of Ecommerce