Unlocking OTT Monetization Opportunities with In-video Shopping

Competition in the OTT industry is intensifying. Video services are constantly seeking innovative ways to engage their users and maximize revenue. And just as the growth of digital media and video content has accelerated a shift in viewing behavior, it has also led to a significant change in shopping habits with more consumers now opting to purchase items online. Statista reported that online transactions accounted for nearly 19% of all retail sales worldwide in 2022, and this is projected to increase year on year. As video service providers seek out new ways to connect with viewers and satisfy the needs of advertisers, could in-video shopping experiences create a new space for user engagement while also enhancing the value proposition for advertising partners? 

The power of video in driving purchasing decisions 

Brands and influencers on social media were quick to recognize the effectiveness of video in capturing audience attention and encouraging them to make purchasing decisions. Video is a powerful tool for driving conversions for a number of reasons. Its combination of visual and auditory elements engages consumers in a way that text or static images do not. Video formats can also be effective in evoking emotional connections with a product or brand, which is a powerful driver of conversions. Also, when advertisers can show how a product looks and functions in real-life situations, it naturally entices more people to try it out. 

Using video to drive conversions and increase revenue is not limited to influencers and content creators. It also holds immense potential for broadcasters, service providers, and sports organizations, who have the opportunity to leverage their content to create immersive shopping experiences within the video environment. In order for this to work, however, it is critical that these experiences are user-friendly and easy to navigate. If viewers find it too complicated to access product information and make purchases, it will quickly lead to user frustration and loss of sales.

How to create in-video shopping experiences

So how can video services offer consumers the chance to easily find out about and purchase items they see on screen, without interrupting the viewing experience? In my opinion, there are two important parameters to experiment with at this point in time: the context for product placement in a way that increases buyer incentive and the amount of steps needed to place a purchase.

Together with AWS, Accedo has been experimenting with an AI-powered virtual product placement cloud engine. This backend system identifies relevant objects within videos, such as products and logos, and pre-filters video frames to highlight shoppable metadata. This means that viewers can find out about and purchase items in one seamless experience. It also aims to lower the editorial investment to enable this experience across all assets of a TV show, as well as giving control over the relevance of the incentive (eg. product’s exposure in the scene).

Regarding the purchase flow on TV, we usually recommended leveraging a second device due to the heavy experience enabled on big screens. This is a viewing behavior many consumers already engage in on a regular basis. By leveraging a second screen such as a smartphone or tablet, viewers can enjoy uninterrupted viewing, while also shopping for the products that they see and find appealing on the larger, main device.

At Accedo, we have devised two methods using second screens to enable seamless in-video shopping experiences.

The first method leverages the primary screen to display products alongside the video content, tailored to what viewers are currently watching. Users can explore product details without interrupting their video stream, and when ready to make a purchase, a QR code appears for quick mobile device transactions.

In the second approach, the primary screen captures the viewer's attention, while a dedicated app on a second device identifies the content being viewed and displays associated products. For viewers watching on a mobile or tablet, same screen shopping experiences can also be enabled so that the user can continue to enjoy the content at the same time as engaging in a shopping experience. 

It is worth mentioning that this dual screen approach may get disrupted by e-commerce platforms investing in video shopping. The launch of Amazon Anywhere earlier this year is exactly addressing that hurdle - “With Amazon Anywhere, you can now discover and buy physical products from Amazon stores without ever having to leave your game or app.”. There are of course ground rules that will have to be set with the OEMs and how they will enable these new purchase experiences on their platforms, but fundamentally this is a clear sign of convergence of two worlds - e-commerce and media.

In-video shopping offers video service providers the potential to establish a new platform for attracting advertisers and enhancing the viewer experience. It serves as a streamlined distribution channel for products and services, where providers maintain control over the entire customer journey, from initial interest to final purchase. Empowering service providers to experiment with in-video shopping experiences in this way will help drive conversions for advertisers, which translates into higher revenue streams for content providers.