Short video clips ‘the future of e-commerce’
In the future, we will all be shopping on video apps like TikTok, according to venture capital firm Andreessen Horowitz.
“Whether you’re buying instant noodles or high-end sweaters, it has become increasingly clear that short video clips are the future of e-commerce. Think of them as compulsively watchable commercials - with a direct link to buy,” a blog post argues.
“Through the rise of short-form video content platforms like TikTok, Instagram, YouTube and Pinterest, we are entering a new era of native e-commerce. Entrepreneurs ranging from farmers to indie craftspeople to clothing designers are able to reach shoppers directly through self-recorded video clips. Soon we will think of video apps as a platform not only for entertainment, but for retail,” it adds.
This shift creates a huge opportunity for existing brands, solo creators and upstarts. In this format, the cost of A/B testing is extremely low, meaning sellers benefit from instant feedback. As experimentation with e-commerce and video continues, brands will also harness the wisdom of the crowds in R&D.
The monetisation of short video is already happening in Asia. On Taobao, for instance, 42% of product pages already include short videos and live streaming is growing quickly. From January to August 2018, the company generated more than $15 billion in sales through livestreams, up nearly 400% over the year before.
The blog post concludes: “In the future, as more apps become super-apps, ‘click to purchase’ will be ubiquitous. But the potential of short video extends far beyond straightforward transactions into the marketing and discovery phase, showcasing craftsmanship, tutorials, and product tests, and more. A 2018 survey found that 85% of Millennials in the US reported buying a product or service after watching a video. As video apps launch native shops and integrate with third-party platforms, that statistic is likely to rise.”