How Livestreaming Can Help Brands and Retailers Optimize Digital Shelf Space

After first gaining popularity in the mid-1980s when CPG markets saw an explosion of products, slotting fees continue to be a routine cost retailers charge brands. Essentially, a slotting fee is what brands and manufacturers pay to have their products placed in prime positions on in-store shelves and endcaps. A digital slotting fee serves the same purpose, giving brands an opportunity to capture prime placement on a retailer’s website or an online marketplace’s digital shelf space via sponsored product placements.

In the highly competitive online retail world, capturing top-notch digital shelf space is critical to a brand’s e-commerce strategy. Depending on the product category, brands may pay thousands to millions of dollars for sponsored placement on top e-commerce sites, especially during “high traffic” times like back-to-school shopping days or the holiday shopping season.

While a sponsored placement can drive substantial revenue, it still requires brands to design an impactful customer experience at just the right time to set themselves apart from the competition. Live video provides an opportunity to create the perfect customer touchpoint within the realm of digital slotting fees, offering both brands and retailers a new strategy that can raise brand visibility while delivering all new revenue streams for retailers.

The Impact of Live Video Within the Digital Shelf Space

With the increasingly blurred lines between online and in-store shopping — think buy online pick up in-store (BOPIS) options or someone researching a product on their phone while in a brick-and-mortar location — brands need new ways to mesh their digital strategies with their in-store tactics.

Live video offers an effective solution to bring these two separate brand strategies together, delivering a personalized experience via the digital shelf that drives sales, increases revenue, and helps build lasting customer relationships. China has witnessed major gains from livestreaming commerce, but the U.S. e-commerce market has been a bit more gradual in its adoption of live video across the e-commerce and social commerce landscape. Brands that capitalize on the novelty of livestreaming now have the potential to reap the rewards in the future when the now-trend will likely become the future norm.

Already we can see the live video trend shifting: TikTok’s massive popularity, along with Facebook and Instagram Reels engagement rates, are proof of that, helping cement live video’s ability to capture consumer interest. According to Emplifi’s recent social media trends report, Instagram users are more likely to gravitate toward Instagram Reels content than any other content formats on the platform, with Reels garnering, on average, 75 interactions per post in Q2 2023. Facebook Live video posts are also seeing over-the-top engagement rates, dominating all other content formats with four times more interactions per post than static video posts.

When you overlap these findings with Insider Intelligence’s forecast that U.S. e-commerce sales will grow by more than 10 percent this year, reaching nearly $385 billion, it’s clear that live video offers a major opportunity for brands to grab a measurable share of the e-commerce market.

3 Ways Brands Win By Leveraging Live Video Across the Digital Shelf Space

1. Increased visibility for your products: E-commerce sites and marketplaces like Amazon.com are critical to a brand’s e-commerce success. But marketers know brand visibility is a key to strong performance on the digital shelf. By partnering with online retailers that have massive audiences and consistently substantial traffic, brands gain major visibility and reach for their products. Using live video in this capacity amplifies the brand’s visibility and takes the online shopping experience to a new level.
2. Stronger connections with your audience: Real-time interactions between a brand and consumer can have a big impact on your bottom line. Consumers want authentic experiences with brands that they trust. Connecting with your audience via livestream shopping events, either one-on-one or one-to-many, strengthens the brand-customer relationship while accelerating the buyer’s journey.
3. More impactful content opportunities across platforms: Not only do live video opportunities give brands a chance to respond to shoppers in real time with relevant product information or recommendations, they provide a chance for marketers to collect impactful content that can be repurposed across their marketing channels. Live video can be turned into on-demand shopping experiences, as well as used on product pages to answer common customer inquiries. It can also be combined with social media campaigns to offer a powerful tool to drive traffic from various sources, helping promote an online sales event or other virtual shopping experience. Also, with the right technology, a live video broadcast can be streamed simultaneously on multiple channels, including social, maximizing its reach and impact.

3 Ways Live Video Moves the Needle for Retailers

1. Retailer-brand partnerships drive more opportunities to increase profits: Same as the slotting fees that became popular four decades ago, offering live video opportunities across the digital shelf gives retailers an opportunity to increase profits. Because they can charge more for sponsored live video placements, online retailers are not only able to recoup any added technology costs to broadcast live video, they can optimize their digital shelf to drive higher revenue gains.
2. Additional revenue streams: In the same way that digital ads can be targeted to various audiences, live video events can include relevant product recommendations that help drive additional revenue streams for retailers. During a livestream event, consumers can view product prompts delivered by the retailer that align with the video presentation — giving shoppers a quick and easy way to add complementary products to their cart while providing retailers with an entirely new revenue stream.
3. Ability to repurpose top-performing video content: While brands can repurpose their live video content across owned digital channels, retailers can do the same with video sessions that achieve high engagement on their e-commerce site. There are multiple tactics for extending the life of a live commerce experience. To start, retailers can host an archive of livestream sessions categorized by brand or product category. There are also opportunities to splice a live video event into snackable video content that can be used on social media, in emails, and shared via text messages.

Live Video is the Future of E-Commerce

Tracking online consumer behavior is as challenging as it has ever been. The proliferation of digital channels, complex customer journeys, and ever-evolving customer expectations means brands and retailers must move at an accelerated pace to align their e-commerce strategies with shifting consumer trends.

Brick-and-mortar stores aren't going away, but consumers expect brands to be wherever they are both in the physical world and on their digital devices. Whether a shopper is looking at their phone while standing in the aisle of their local grocery store or at home adding items to their online shopping cart that they plan to pick up in-store, they want brands to meet them there and they expect an exceptional customer experience no matter the location.

Live video provides a new opportunity for brands and retailers to meet and exceed customer expectations. Livestream shopping events are a low-risk, high-reward tactic that can help drive major outcomes for all involved. Brands can increase their visibility and build long-lasting relationships with their most loyal customers. Retailers can drive major revenue gains while building a library of impactful video content. Best of all, shoppers get personalized experiences that deliver real value — increasing their satisfaction with the brand and trust in the retailer.

Zarnaz Arlia is the chief marketing officer at Emplifi, a leading customer experience platform.