Video Commerce: A Video Commerce Roundtable

Earlier this year, Retail Online Integration gathered together three leading video 
e-commerce experts for a conference call to discuss best practices and trends within the emerging channel that retailers need to be aware of in 2012. Joining us on the call were:

Justin Foster, founder of the Video Commerce Consortium, an industry association of e-commerce professionals and online marketers dedicated to advancing the use of video in e-commerce. Foster is also co-founder and vice president of market development at Liveclicker, a video commerce solutions provider.

John Lazarchic, vice president of e-commerce at PETCO, a specialty cross-channel retailer that provides products, 
services and advice targeted to pet parents. PETCO operates 1,100 stores in 50 states, as well as a pet product and information destination at Petco.com. The company has about 200 in-house and vendor-supplied videos, with one employee devoted entirely to video commerce production.

Jon Schroeder, video director and editor at Crutchfield, a cross-channel retailer of consumer electronics products. There are 600 videos currently housed on Crutchfield’s website, including in-house and vendor-supplied videos. Schroeder is part of a five-person team that’s exclusively tasked with producing and editing videos.

Here are the highlights of our discussion:

Retail Online Integration: How do you use video on your e-commerce site?
Jon Schroeder: We have product spotlight videos that highlight one particular product or group of products, as well as editorial or DIY [do it yourself] videos that teach prospects how to do specific things, such as how to best set up speakers. We also have a new kind of video we’re calling the “heads up display” series, or HUD videos. These videos give prospects an in-depth look at car stereos.

John Lazarchic: We’ve got product-specific videos supplied by vendors that are geared to help consumers make decisions on buying a specific product. For example, showing how a product is used or the benefits of it. We’re also starting to build our library of 
how-to videos produced by PETCO. These tend to be more general in nature, such as how to set up a terrarium for your reptile, how to set up an aquarium, how to groom your dog, etc.
We’ve also created 
in-house videos for branding 
purposes. For example, we did a branding-oriented video last season around dog apparel. It was a two-minute apparel photo shoot video, which gave viewers a behind-the-scenes look at what goes on during a dog photo shoot. These kinds of videos aren’t really designed to drive sales as much as they are to put a little character behind the PETCO brand.
They let consumers know that we’re fun and we get you and your pet. We push these kinds of videos out to our Facebook page as well as post them on our homepage and email them to customers.

Justin Foster: Have there been any cases where 
vendors have offered to compensate you to produce video content? Has there been any success there or lessons learned?
JS: We’ve had a few vendors compensate us to make videos for their line of products. I think it worked out wonderfully.

JL: We haven’t specifically gone to vendors for funding to produce videos yet. But when vendors want to do more promotional-type videos on our website, they fund the production of them and also the real estate and impressions that they’re getting.

The Value of Video
ROI: What do you like best about video on your site? What’s the value of it for your company?
JS: On a quantitative level, we can measure conversion uptick when a potential customer has watched a video. We also know that when someone watches a product spotlight video, for instance, they’re more likely to add it to their cart. We know that video is a great way to spread brand awareness and sell our advisors and their knowledge. This makes potential customers feel comfortable to make purchases now or down the road.

JL: Same thing. We can track data. We can look at whether video contributes to a consumer’s propensity to add a product to their cart or convert on a product. We also use our videos for branding and consumer engagement, which is of even bigger value to us.

ROI: Can you discuss any specifics around the 
conversion rate you see when a video is associated with a product?
JS: I can tell you that about 5 percent of our total web traffic ends up watching a video. Of that 5 percent, there’s a positive correlation between conversion and watching a video.

JL: Not that we can release. But we’re seeing enough of a positive correlation to continue to invest in it.

JF: In terms of ongoing support for video and the ability to keep investing in it, how much of that’s coming from the impact it’s having in your stores and through catalogs and 
social media?
JL: We haven’t really tried to correlate video back to store activity. I think it’s one of those holy grail questions: How do you measure your website and the impact it has on your stores? Everyone is still trying to figure out a solid measurement on that. When you get into video it’s an even more granular measurement. It becomes even more difficult to correlate any kind of value to that. However, I think as mobile starts becoming more of a piece of the business, we can start measuring mobile usage in-store via people scanning QR codes or near field communication codes to play videos in-store. Then we’ll begin to start getting some measurements.

JS: We try to foster multichannel activity for our potential customers by using QR codes in our catalogs that go directly to our videos. When someone is sitting at home flipping through our catalog they can whip out their smartphone, scan a QR code and get more in-depth with the particular product they’re interested in. We’ve done this with several of our catalogs, which are sent to 30 million people six times per year. We have the in-home penetration, but to get the potential customer even more engaged with our videos on their smartphone is that much better for us.

Video Commerce 
Best Practices
ROI: Can you share with us some video e-commerce best practices?
JF: The first thing is that video doesn’t have to be difficult. I have an HD camera, editing software, a white backdrop and some lights right in my office that I think I bought for $250 that work great. Second, it’s really important to focus on scaling content. I think the third best practice is to not just use video on product detail pages. In fact, video is a great asset to leverage across channels, including social channels like Facebook and YouTube and its programs. YouTube can be used to drive traffic back to retail sites.

JL: My advice is to test a few small YouTube videos with a link back to your site to see if consumers are engaged. In this scenario you can get a little bit of experience for a small investment. From there you can start making a business case for a larger investment. I also agree with Justin about leveraging video throughout your site. We have three videos on the bottom of our homepage focused around pets. We’re always trying to bring videos a litle closer to consumers. If they’re buried in the detail pages, they’ll obviously have a lower engagement level. Finally, leverage email. We’ve had great success putting videos in emails. Consumers open the email and are directed to click on the video. We’ve seen high engagement levels from that.

JS: My first best practice would be to let the video become as authentic as possible. There’s a kind of inherent dishonesty to an overproduced video. Always try to let your brand breathe through your videos. My second piece of advice would be that when you do have videos out on different channels like YouTube and Facebook, always have a link back to the product page and your homepage. Last but not least, make as many videos as you can and try to cover as many SKUs as you can. That’s something we’re always trying to do here at Crutchfield — beat the previous month’s video total and keep building that up. We’ve been on that upward path for about 18 months now.

ROI: What are some of the challenges you've encountered with video commerce?
JS: One challenge we had that we acted upon almost two years ago was that our videos were taking too long to produce and were a little bit too slick. We had a studio with lots of lights set up, we did a lot of motion graphics and some of the videos were up to 10 minutes long. In an effort to make more videos in the same amount of time, we decided to ratchet down the production value a bit and make them shorter, more improvised and less scripted. Since we’ve made that paradigm shift we've found that we get a lot more views and a lot more comments on all of our videos.

JL: Similar to what Jon mentioned, we try and keep it so that our videos aren't too polished. One thing we read and heard a lot about from other retailers was that you don't need an overly polished video for what you’re trying to do here. Consumers are completely accepting of something that’s a little more rough than you might do for something you’re publishing commercially, in a traditional sense.

ROI: Have you considered repurposing your videos for television commercials or is that a totally different area?
JS: We have another company completely separate from our video team that produces all of our television commercials. We keep them totally separate.

JL: We’re the same way, completely separate. I think it’s a different venue. For us, TV commercials are all about a campaign around the brand or selling something. Web video is more how-to or solution based. And there’s a big difference between a 15-second to 30-second TV commercial clip and a two-minute how-to video for a product.

ROI: Do you find videos help increase your organic search ranking?
JF: Definitely. Video search engine optimization is a primary reason why many retailers get into video. One best practice around video SEO is to make sure you’re submitting a Google video site so that a video thumbnail can be indexed in the search results on Google. It’s really easy to check if your site has videos that have been submitted to Google. Just go to Google.com and click on the “Video” link at the top of the page and type in your site's domain. If you have videos being indexed by Google, they’ll show up there. If you haven’t properly submitted a video site to Google, then they won’t show up.