Conversion

Video Boosts Sales for Online Retailers

At brick-and-mortar retailers, shoppers can stroll the isles, handle items, speak to clerks, and receive well placed merchandising messages. It’s not that easy for ecommerce merchants. They must find new and inventive ways to engage and convert customers; using well written and persuasive content, great photographs, related product links, and cross-selling tools. In this ever-advancing cycle of innovation, merchandising with video might be the next bottom-line booster.BorderMedia features author and artist videos online

“There is a clear trend that a lot more [online] retailers are incorporating video into their user experience…and we know that video works,” said Kevin Ertell, senior vice president of ecommerce at Borders Inc., Ann Arbor, Mich.

With the support of its 1,100 retail stores around the world and $3.8 billion in revenue for fiscal 2008, Borders was one of the first online retailers to use video as a way to both attract and keep customers. Their videos engage, educate, and entertain. But perhaps more importantly, they build total brand awareness and showcase particular products.

“The BordersMedia section of our site is designed to really engage people,” Ertell said. “We have the same passion for books, music, and movies as our customers and we really want to get to know the authors and artists. That’s why we have Live at 01.”

Borders Live at 01 videos are a sort of variety show that is part entertainment and part merchandising. Site visitors can watch author interviews or listen to musicians playing songs from their latest album.

“The hope is that as people become engaged with an author or artist on our site, they will want to read the book or listen to the music, and we hope they buy it in our stores and on Borders.com,” Ertell said.

Merchandising Videos for Small or Mid-sized Stores

While Borders.com is perhaps one of the best examples of well-executed video merchandising in the ecommerce space (with one exception which will be mentioned below), it doesn’t take a billion dollar corporation to successfully use video.

Blendtec, a division of K-TEC, Salt Lake City, Utah, uses simple, easy to implement video to demonstrate its relatively high-end blenders which sell for between $399 and $799 online. The videos discuss the blenders’ features; frequently include recipes for milk shakes, smoothies, bread, or salsa; and essentially sell a blender that might be ten times the price of a Cuisinart at the local discount box store. After watching the videos, those Blendtecs seem worth the price.

“People buy and sell in different ways then they have before,” said George Wright, director of marketing and sales for Blendtec. “They are making more online purchases all the time. Do things the old way and you will have a smaller and smaller audience online. …[the customer] is not in a store kicking the tires, you have to build an experience [for them], and video is a great way to do that. You can show them how the product is supposed to work.”

In addition to its many demonstration videos, Blendtec also produces a series of TV-show like episodes called, Will it Blend. Will it Blend pits shoes, action figures, garden equipment, and even electronics against the Blendtec blender’s powerful motor and steely blades. The series has a massive cult following, with more than 2.3 million viewers on Blendtec’s YouTube channel.

“You have to use video if you are going to keep up and aggressively build a company,” Wright said.

Nike: Will it Blend

Shoppers Are Ready for Video

In February 2007, a JupiterResearch survey of 2,319 online consumers found that 46 percent of those surveyed watched online videos at least once a month, while 43 percent of broadband users viewed online videos at least weekly.

“Online video is seen as a mechanism for encouraging site visitors’ engagement (e.g., increasing the duration of site visits) [and] enriching site visitors’ overall experience,” JupiterResearch said.

According to the survey, 18 percent of those online consumers with broadband service and 15 low-bandwidth users wanted to engage with product demonstration videos like the ones on Blendtec’s site.

Videos Might Not Be Right for All Products or Brands

Blendtec is selling a high-end product that promises superior performance, and its videos actively demonstrate that performance for online shoppers. But a video promoting a commodity product would not have the same effect.

“Video might be overkill for some pitches and products, and become more of a distraction than an incentive to convert,” said Stefan Tornquist, research director for MarketingSherpa. “For something complex, visceral, or new, video can be a great fit. Selling fly fishing in the Arctic? Video is going to do a better job of putting the prospect in a buying frame of mind than all the copy you can muster. Introducing a new service or product? You can explain why it’s different in 15 or 30 seconds of video that would equate to pages of text. But, for a product that is a known quantity, easy to explain or understand, video may not be warranted. In fact, it may complicate the issue.”

There may even be some challenges with using video to build brand awareness on ecommerce websites. “I’d think it’s entirely dependent on the brand building measured against the distraction to consumers that are already there to buy,” said Tornquist. “Unless you’re premiering something they didn’t know about or giving them something unique to online buyers, I’d ask why to have something interfering with their shopping – that is, of course, if it does interfere. The Borders’ homepage gives people the subtle option to play a video, it doesn’t force it on them. Even the Borders solution gives me pause, however, because it takes people to another page. Seems a bit clunky from a usability standpoint.”

Potential Performance Pitfalls

There is also a danger in offering visitors a poor video experience. The very same JupiterResearch study that found that almost one-in-five broadband users wanted to see video demonstrations, also found that 60 percent “of regular online video users (i.e., those who watch online video at least once per week) are relatively less likely to return to a site for video content if the viewing experience is poor. Also, 43 percent of regular online video users said they would seek their video content from a competing Web site [sic], and 27 percent said they would be relatively less likely to visit the Web site [sic] again for any reason.”

So poor demonstration videos might send more than a quarter of potential customers away, never to return. And a “poor” video might have nothing to do with the content. According to JupiterResearch, “online video that is interrupted for buffering purposes and playback that is slow to begin are the greatest sources of frustration with online video. Buffering issues are the number-one problem online video users encounter. …44 percent of online consumers who viewed online video… and were frustrated with the viewing experience attributed their frustration to playback interruptions due to buffering. Also, 35 percent of online video users who were frustrated with their viewing experience felt the video took too long to begin playing.”

Retailers need to make sure that their hosting solution can manage the sort of bandwidth video can require.

Video placement is also important. In the case of Borders, for example, the videos are high quality, interesting, quick loading, and professionally produced, but they are not linked from product pages. If customers were thinking about getting Representative Nancy Pelosi’s new book, Know Your Power: A message to America’s Daughters, they would find an 8-part discussion with Pelosi in the BordersMedia section that might inspire them to buy, but if they simply searched for the book in Borders’ site search and visited the product page, they would be hard pressed to find any reference—let alone a link—to Borders’ video merchandising.

Likewise, Blendtec does include its excellent videos on all product pages, but only behind a vaguely labeled “Resources” tab.

When to Use Video Merchandising

Demonstration videos, branding videos, videos that both entertain and merchandise should be part of an online retailer’s “tool box” of marketing and customer engagement tactics, but only when it makes sense for the product and only when it can be delivered well, without buffering issues or download problems.

Good demonstration videos should also be easy to find and logically connected to the products they feature.

There are many indications that video will boost ecommerce sales, but like all marketing and all merchandising, video must be done thoughtfully and well.

Video Resources

Armando Roggio

Armando Roggio

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