MNTN Research Peeks

Analysis

The Living Room Shopping Experience is Just Getting Started

Abstract

  • Connected Television is becoming a shoppable digital experience
  • Consumer interest in being able to shop through their TV has grown over the past five years.
  • Shoppable TV is being supported by an increased utilization of cross-device experiences
  • These nascent experience’s are influencing brands to take daring new approaches with their ad creative

Someone spoke the truth about the living room shopping experience way back in 2017:

“Over 75% of customers want to shop through their TV”

In 2017, we had already become accustomed to shopping on our televisions for a few years. Just maybe not in the most obvious use case.

In May of 2008, iTunes upended the physical media industry. They allowed moviegoers to buy a streaming copy of a film from their platform on the same day that it was released on DVD. This was three years after they first allowed their users to download a limited selection of videos and television series from their service. The moment that you could instantly buy new releases, however, changed the game for film distribution permanently.

This ubiquitous experience of buying directly on the biggest screens in your home is why the potential for Connected TV to become the next big digital destination for shoppers should excite you. While you may logically expect consumers to have hesitations over connecting their credit cards to the biggest screens in their home, the fact is–we already do. 

And with the living room shopping revolution, you’ll now be able to shop for even more

What Do We Mean by the “Living Room Shopping Experience”?

The phrase “living room shopping” may conjure images of old-fashioned home shopping networks, like QVC. But the living room shopping experience is more nuanced than its analog forebears. It’s an evolutionary point for television ads, morphing from pure brand awareness plays and into a performance marketing channel that can take your customers from the couch to a conversion

As Connected TV becomes as actionable as Google Search and social media channels, you can coax your target audience down the path to purchase while making in-flight changes to your creative so that you are zeroing in on what is driving the greatest impact. Because of the addressability and measurement capabilities that CTV offers, you don’t have to cater your entire creative strategy to one specific goal like ROAS or Cost Per Completion. Rather you can deploy ads that are designed to sync with your consumers based on where they are in the sales funnel – be it awareness or nearing conversion. As you iterate on your ads, you can make agile moves so that you are optimizing your creative to its greatest money-making potential.

The performance marketing power of CTV advertising is a leading reason why retailers are starting to increase their spend on the channel as the strength of the platform continues to prove itself. Additional reasons ecommerce retailers are shifting spend to CTV include:

  • Addressability (27%) 
  • Measurability of performance (16%). 
  • Reaching first-time customers (8%)
  • Gaining incremental reach (6%)  

Ecommerce brands are seeing CTV’s potential at a perfect inflection point when consumer buying behaviors are shifting. Research from McKinsey and the IAB report 70% of Americans engaged with new shopping channels during the COVID-19 pandemic. The report also found that 44% of Millennials and Gen-Z experimented with new brands, with 84% saying over a year later that they will continue to purchase from these new brands.

Clearly the catalyst for these changes in behavior and interests in new shopping channels was the pandemic upending how we live our lives. But this statistic should also put some wind under your sails for CTV’s future as a digital storefront. Consumers are already willing to try something new–so long as you give them the option.

Consumers Can Research Products on CTV

Before we go into specific examples of ways you can make living rooms the next shopping destination, I want to share an anecdote from Chris Contreras, SVP of Customer Success at MNTN. He spoke with Ad Week about this very topic, and was asked a question about how to best engage the window shoppers of ecommerce: abandoned carts. 

As Chris mentioned, abandoned carts represent approximately 70% of ecommerce users. Because this isn’t a new problem, marketers have an entire playbook for how to re-engage these customers through more traditional channels like email marketing, or retargeting. But theres a better way to target abandoned carts, as Chris explained,

“Where we’ve seen success is loading those abandoned cart users into some kind of strategy on CTV.  I feel like folks who leave stuff in their cart are not doing it because they don’t want to purchase it. They just probably need a little bit more research. But they can be reignited via CTV… to remind them they have an option to purchase something.”

What Chris highlights is a perfect anecdotal use case for how CTV can instigate action for an ecommerce brand. In an era where data privacy regulations have a grip on the ability for online stores to find and reach their target audiences, CTV is a way to contextually engage with them through the content they’re most likely already consuming. And they can then use that data to inform their social and search strategies.

Chris explained that if you’re consistently testing messaging, you’re able to discern which messages are performing the best–and worst–for your target audience. This allows you to draw conclusions about why your ad performed the way it did. Was it because the creative was not aligned to the audience, or were you simply targeting the wrong users to begin with? You can then use those insights to inform strategies for other cross-marketing channels because you have a well-rounded perspective on the specific types of content your users are consuming. As Chris concluded,

“In our platform, you can see what specific channel [users] are consuming content on based on how they’re performing. So you can marry both of those data points together to discover engaged audiences you maybe didn’t know you wanted to target, with the performance data to back it up. Brands are then leveraging those tactics on social and search to kind of fine-tune their ability to go after these audiences.”

So, yes, CTV is a driver for keeping your brand at the front of your audience’s mind–and for discovering new audience cohorts you may not have first considered.

But those are not the only things you can do to entice customers to “buy now” on the biggest screens in their home.

Blurring the Line Between In-Person and Online Shopping: Cross Device Experiences

Outside of the pure performance marketing power of Connected TV for retailers, there are opportunities emerging that are helping make shopping directly from the biggest screen in your home even easier. We call these Cross Device Experiences, because they are actions you take on a second device after being delivered a message on CTV. In other words, it takes customers from the big screen to the small screen. 

Now more than ever, brands have the technology to connect the dots from when a CTV ad is served, through to the viewer taking action on another household device and tying these metrics directly back to the content served on the biggest screen in your home. You can explore this experience by leveraging a feature of the MNTN platform: Cross-Device Verified Visits. This allows you to track (via an IP address) whether a viewer took an action on a second device after viewing a CTV ad through completion. 

This gives advertisers the ability to serve follow-up ads on their mobile device, creating a streamlined experience that naturally coaxes customers down the path to purchase.

Cross-device behavior is only growing more important every year. According to a report from eMarketer on cross-device behavior, 74.2% of US adults will use an internet-connected device while watching TV at least once a month in 2022. 87% of TV viewers watch with a second screen in hand, whether that’s a mobile device, tablet, laptop, or e-reader. A majority of these viewers (65%) use their secondary device to look up information and head to an advertiser’s site while they stream. 

From Q to R

It may have been a part of our digital world for well over a decade, but QR Codes really had a moment in 2022. eMarketer projects that there will be 99.2 million QR code users by 2024, an increase of 28 million from 2019. 

But this moment is another example of the power of the cross-device experience. Because the moment millions of people got off their couch, scanned a bouncing QR code, and found themselves on a product landing page, the utility of shopping on CTV was crystallized. We will take action on a mobile device if our TVs tell us to.

The capabilities of shoppable QR codes are still being refined, but TV platforms are already trying to take advantage of the code’s popularity. Currently they will mostly appear in the corner or tops of the screen, oftentimes through the length of the commercial to give the viewer enough time to scan the code with their phone and make purchases from their device.

One company already experimenting with this is NBCUniversal and their product “ShoppableTV,” which allows advertisers to overlay a call-to-action and QR code within their ad inventory.

Who’s Already Making Moves?

As we just mentioned, channels like NBCUniversal/Peacock have already unveiled shoppable TV experiences that allow audiences to scan QR codes to purchase items that on-screen talent are wearing–with other channels like Roku hot on their tails devising their own experiences. Let’s look at the moves already being made.

Roku/Walmart

In 2022, Roku and Walmart struck a deal to sell shoppable ads in Roku’s streaming inventory. The ads would allow viewers to buy products from Walmart, so long as they had already tied their credit card to their Roku device. 

The benefits of this experience are clear to Walmart’s CMO William White, “We’re working to connect with customers where they are already spending time, shortening the distance from discovery and inspiration to purchase.”

YouTube

In 2021, YouTube announced they were expanding their video action campaigns to include CTV inventory. As YouTube stated in a press release, “With a quarter of logged-in YouTube CTV viewers watching primarily on TVs, the living room is becoming an essential place for brands to drive incremental conversions with new audiences. In early experiments for Video action campaigns on TV screens, over 90% of conversions coming from CTV would not have been reachable on mobile and desktop devices.” 

The only sticking point for YouTube’s solution is that it requires the user to type in a URL that is displayed at the bottom of the ad, which isn’t quite as seamless of an experience than if you were, say, being targeted by your IP address and delivered a responsive dynamic ad the next time you open up Google Search or social media.

LGTV

This smart TV brand has been on the cutting edge of creating engaging shoppable TV experiences. In one unique experience during the NBA Playoffs, viewers watching the game on LG’s ThinQ TV were delivered a shoppable interface. There they would be able to see the type and brand of shoe each player was wearing, and purchase them directly. 

They also partnered with the UK reality series Love Island in 2021, offering an experience via the A.I. technology embedded in their televisions. During the show, they would see another shoppable interface that highlights relevant products they are seeing on-screen. Then they can use their remote to visit the brand’s website or request a link be sent to their phone.

Conclusion

What does the future hold for shopping on CTV? We can look at social media to discover what’s next. 

Live streaming entertainment took off in 2021, reaching a market value of $70 billion with apps like Twitch bringing in tens of millions of daily visitors. This boom in live streaming is the impetus for the emergence of live stream shopping events. Live stream shopping takes the popularity of streaming, which can be found on a variety of social media platforms, and combines it with elements of a nostalgic experience: home shopping networks that were massively popular in the 80s and 90s. 

As viewers watch an influencer or celebrity speak passionately about their products, they can then immediately buy it through a link in the stream. According to Statista, sales from ecommerce live streaming will rise to $35 Billion in 2024. As living room purchasing behaviors evolve, live stream shopping is a natural extension of the experience, while also layering in the native experience of social media.

This is ultimately what the living room shopping experience is destined to become. A streamlined funnel from stellar content to a fast and easy conversion. By keeping your finger on the pulse now, you’ll have the foundational knowledge to grab this opportunity early, so that your brand can be seen as the hallmark living room shopping experience in the future.

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