Google is in the early stages of creating a new shopping experience on video through its wildly popular YouTube site. A new beta feature released just before the holiday season is being adopted by brands, particularly fashion and retail, to drive in-stream sales.
Shoppable video is still in its infancy, but trends in online behavior and new shopping patterns are leading to a greater focus on the medium. Marketers have always had an eye out for sales through video content, but the path has largely been elusive. Google wants to change that by embedding clickable ads into products displayed on videos. The goal, of course, is to improve the online shopping experience without overwhelming YouTube videos with ads.
"With YouTube external annotations, we're trying to make it a very seamless process," said Lisa Green, industry director at Google. "If while you're watching it, you see something you really want, you can click... We've allowed the user to make the decision to make the purchase" in the video.
The beta feature is available to all existing clients, although Google won't disclose how many advertisers have shown interest or signed up thus far. Juicy Couture, one of the first brands to adopt the shoppable feature, released a new video directed by Terry Richardson featuring Candice Swanepoel at the famed Chateau Marmont hotel. The fashion label features nineteen different products in the second video.
YouTube's shoppable video ads will display a shaded rectangle in the middle of the screen whenever a product appears. When a user rolls over that embedded video link, the product name is displayed with a link to the purchase page. Google's product and sales teams are working with advertisers to bring these new ads into their videos on YouTube, Green said.
"Retailers and fashion brands in general are really starting to use YouTube as a place to showcase their brands, and during the holidays in particular to drive sales," she said. "It is going to play an even bigger role in the holiday shopping season this year - more than any other year."
In late October, a study from the market research firm Ipsos commissioned by Google found that 80 percent of shoppers will research online before making a purchase this holiday season. Making matters more confusing for marketers, the report also found that 51 percent of shoppers will research online before making the purchase in store, 44 percent will research and buy online, 32 percent will research online and in store before making the purchase online and 17 percent will research in store before buying online.
Todd Pollak, industry director of retail at Google, summarized what he calls the first "Nonline holiday shopping season" in a blog post. "In short, the shopper's journey looks less like a funnel and more like a flight map, and the lines between online and offline shopping experiences are blurring," he noted.
"Retailers are centering their campaign around these videos" as the medium "becomes a place of influence for their brand," said Green. "These don't always have to be high-end, edgy content... I think it really ranges depending on who your target audience is, but ultimately it is about the investment you put in to drive traffic to these videos."
"The sort of myth of the viral video has passed. These videos are all out there, but there's ways to drive traffic to these videos," she added.
As for any potential confusion between videos and ads among YouTube users, Green argues that entertainment and ads have already merged to a large extent.
"I think there's a real blurred line between content and ads. What I would say is generally if you have a really wonderful video it can be shown as an ad," she said. "A shoppable video certainly has commercial intent. I don't think it really matters what format someone is watching it."
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Matt Kapko has been writing about mobile since 2006, before it became cool. Based in Long Beach, CA, he has covered mobile entertainment, digital media, marketing, and advertising for several business media outlets. A former editor and reporter for RCR Wireless News, paidContent, and iMedia Connection, Matt is a regular freelance reporter for ClickZ. You can follow Matt on Twitter at @MattKapko or drop him a line at email@example.com.