Why I’m Quitting Shoppable Video

Video has completely taken over: 10 billion video views will roll off today and an estimated 86 percent of Internet traffic will be dedicated to video in 2016. But despite its dominance, video monetization is reliant on old models: TV-style media buys and the clinging ridiculousness of banner ads.

Video is also powerful: brands using video see a 42 percent lift in purchase intent, with 71 percent of viewers pointing to video as the best way to bring products to life – but little has been done to close the gap between these engaged viewers and actual transactions.

In my former life as a filmmaker, brands I was creating content for would gripe openly: our customer loves video, but it’s a huge expense and we’re left to do little more than cross our fingers once released. With that, some brilliant people and I set out to straighten those fingers.

After a year and change, hundreds of hours of customer interviews and countless iterations, we launched what I believe to be the best shoppable video product ever: Showroom.

Showroom is deceptively simple. See a product you like in a Showroom-activated video? Click on the interactive player and purchase it right from the content. Viewer to customer in just a few clicks.

And Showroom innovated well past previous attempts: We were the first to solve for native mobile, the first to integrate with e-commerce platform APIs and the first to enable multi-item checkout. We developed our product with a sensitivity and respect for video – seamless shoppability in support of the content, not detracting from it.

But despite our best intentions, the space is riddled with several insurmountable challenges.

We know we love video, but that’s all we know: The inventory/strategy problem

While brands loved the idea of making their videos shoppable, they simply didn’t have enough of it. Most brands produce video only in anticipation of releasing a new line: twice a year, typically spring and fall. The line is by design seasonal, so featured items are obsolete just a few months after a video’s release (monthly recurring revenue relevance is a challenge).

A handful of brands produce more content, but releases can be erratic and arbitrary. Gap, one of the biggest retailers in the world, released 7 videos one month, 16 another and then followed with two video-less months.

While brands loved the idea of making their videos shoppable, they simply didn’t have enough of it.

Then there’s the content itself: Some videos feature no product at all, mood pieces to steer brand narrative – others feature product, but as wardrobe in high production value mini-movies brands are not interested in integrating a commerce element to. Worse yet, some times the product is featured in a video with rapid-fire editing, never on-screen long enough for a potential viewer-cum-customer to interact with it.

Video will always be part of a brand’s marketing strategy, but as a “vitamin” – shoppable video’s inventory/strategy challenge is that it’s effectively a vitamins, vitamin.

I know who I am — I’m the dude playing a dude disguised as another dude: The attribution problem

Alternatively, partnering with content networks (Hulu, Netflix, Crackle etc.) could provide a steady stream of addressable inventory for us and ancillary revenue income for them – but this path un-earths the devils of attribution: Hypothetically, Showroom partners with Netflix to add shoppable functionality to their catalog. Now when you watch House of Cards, you can click on Frank Underwood’s suit and purchase it from Brooks Brothers. Brooks Brothers would make the sale and most likely, Netflix would receive an affiliate commission.

Netflix would then need to distribute that commission to all the mouths to feed along the way: Showroom, the production companies (House of Cards has four), the executive producers (12 plus their related agents and managers), the show runner and, if the star has leverage enough to negotiate (he does), him too.

Run the hypothetical with a video service that allows its content to be embedded on other sites and face even more coffers to fill.

If that all isn’t headache enough for you, it’s important to note this type of content is typically produced almost a year ahead of release and pre-production (the time where these types of interactive product placement deals could be negotiated – and products sourced) can happen up to 18 months from air date.

Coordinating content release with available brand inventory would require a retailer to completely reimagine their production schedule (highly unlikely) and lock in designs a year in advance of release (never going to happen).

Buy one; get 39 free: The pricing problem

Once built, shoppable video’s overhead is little more than storage cost. With little to no barrier to entry, the lack of financial backstop opens the door to a race-to-the-bottom pricing dynamic amongst competitors. (We were once undercut by 90 percent).

With this untenable value problem I’m reminded of a quote from Sayre, by way of Peter Thiel – “the battles are so fierce because the stakes are so small”

There’s always a faster gun and there’s unfortunately always someone that will do it for cheaper.

You can’t sit with us: The distribution problem

By and large the biggest challenge of shoppable video is reach. Despite video’s gargantuan presence, its distribution is controlled by a handful of monoliths – networks understandably interested in keeping users within their walled gardens and networks that are developing their own shoppable video products.

But their attempts are trash: YouTube’s new shoppable video product does not work on mobile and Facebook’s is a UX nightmare. Brands and customers have openly mocked the attempts, but in effectively controlling distribution, the giants move at their pace and by their rules. 

This foreshadows the biggest threat to shoppable video ever getting off the ground.

Go to where the puck is (oh, but there are 10 pucks): The multi-experience problem

Shoppable video should be an inevitability, but several unique and siloed experiences across platforms will hamstring its widespread adoption and potentially cripple it as the Holy Grail of video monetization. Forcing brands and viewers to adopt multiple approaches will likely keep any of them from gaining significant traction.

If viewers are forced to re-learn shoppable video on each platform they cross, they’ll likely ignore them all.

When television commercials were introduced, if each channel had its own approach, toolkit, regulation, distinct experiential technique and provided no transference (e.g. your shoppable YouTube video needs to be rebuilt for Facebook and rebuilt again for say, Twitter) the barrier to adoption may have been too big a burden to navigate.

Further still, the true success of shoppable video is contingent on viewer adoption. Introducing interactive and shoppable elements to video is a leap, and evolving viewer behavior should be a slow and delicate process. If viewers are forced to re-learn shoppable video on each platform they cross, they’ll likely ignore them all.

A unified approach is the best chance for shoppable video to navigate the hurdles of customer and viewer acceptance. However, unification does not bode well in our hyper-capitalist, hyper-competitive and hyper-proprietary climate.

Because our conviction and hearts lie in the evolution of how people use content, in an effort to accelerate and support the development of the space, we’re giving you the codebase for our shoppable player.

In passing this torch along, we hope to encourage the continued growth of video, asking only that you help advance the journey towards creating a valuable infrastructure around it.

Endless thanks to everyone that’s helped along the way and immeasurable love to the incredible team that brought Showroom to fruition — Jeremy AndersonLaura EllnerChristopher Morben and David Gonzalez.