Disclaimer: The following article is the sole opinion of the editor of this blog. It is a thought-experiment based on the release of new technologies and emerging trends in shopping behaviors. It should by no means be interpreted as a roadmap on the direction of Shopify or its partners.
Now that I have your attention, let me be clear….
The death of advertising as we know it will not be swift, but rather a long, protracted ordeal.
But when it finally happens, some will argue that that advertising hasn’t “died” but rather “changed” or “evolved,” but the simple fact is in 10 years time, maybe less, advertising, as we know it now, will be dead.
I know this, because the technologies that will be the harbinger of advertising's demise exist today. What they need now is time to flourish, creativity, and an executive who wants to watch the world burn.
In case you’re wondering, the technologies I’m talking about are:
- Web & mobile buy buttons
- Social buy buttons
- Near field communications
- Mobile wallets (like Apple Pay)
- Smart TVs
- Touchscreens everywhere
Through various combinations of these technologies, the “advertisement” will no longer be a prompt that encourages you to buy somewhere else, but instead, serve as its own sales channel where a customer purchases direct, without ever experiencing “the funnel.”
Why “Advertising as We Know It” Will No Longer Be Sustainable
It’s well documented that our attention spans are at all time lows, so the notion that consumers will continue discovering, researching, and buying the same way we’ve been doing it since 4,000 B.C where paintings were made on rocks to encourage buyers to visit a shop, is difficult to fathom.
The average American today spends between 8-12 hours a day consuming media.
According to a report by ZenithOptimedia, we’re spending 105% more time on the internet than we were 5 years ago, which is also the biggest contributor to that declining attention span I was talking about earlier.
While media consumption has increased and attention spans have decreased, Baymard Institute and others have reported a not-so-coincidental rise in shopping cart abandonment during a similar period.
Could it be because that the sales process where you see an ad *click* view a product page *click* enter your credit card *click* and add your shipping information *click* is becoming too much to ask?
What if the biggest threat to cart abandonment isn’t a lack of free-shipping, but a flurry of text messages from your mom?
Maybe the real problem is that we’re still relying on some permutation of a 6,000 year old method of advertising, and we as consumers are ready to move on?
After all, you’d think we’re savvier than painting ads on highly visible rocks, but doesn’t that still pretty much sum up advertising?
Ok, So What Does Advertising Look Like in The Future?
Quite simply, the distinction between marketing and sales channels disappears.
Conceptually, “the funnel” will need to be rethought, because consumers won’t need to stop what they’re doing and go somewhere else just to make a purchase.
It only seems far-fetched until you consider that nearly every major tech giant has announced some version of native ecommerce in recent months:
- Shopify's embeddable buy button & mobile SDK
- Twitter, Facebook& Pinterest Buy Buttons.
- Purchases on Google (essentially buy buttons for search)
- Youtube’s Shoppable Ads
- Ecommerce on Apple TV
So, when you’re Facebook stalking your high-school classmates thinking about how awesome you turned out, and you see a watch you like, you can just buy it and go back to being awesome.
If you’re struggling to find gift-ideas for your office's secret santa, you’ll just find their “Things I Want” Pinterest board and buy something from it without ever leaving Pinterest.
If you’re searching for that hoodie your significant other has been asking for, you can buy it directly from Google’s search results.
Image via Techcrunch
This native buying experience isn’t limited to social and search either.
Thanks to the embeddable buy button the line between editorial content and commerce will begin to blur. Eventually content, marketing & buying is seamless.
If you’re reading a book review on Paste.com, you could buy the book directly on Paste then continue reading whatever catches your eye next. If you're on a website listening to a podcast, and they mention something you want, you'll just buy it without ever leaving the website.
This makes sense in a lot of ways, because it means that we can stop competing for attention with the channels that are supposed to bring us customers.
Ecommerce growth has doubled in the last 8 years, and I personally believe we’ll witness a massive explosion once the funnel’s been flattened, and people buy directly from the blogs, podcasts, and news sources they already trust.
But, while all of this is cool this is not where I see the biggest opportunity by a long shot.
Native Commerce on TV & In The Street
The idea behind buying products directly from your television hasn’t been widely embraced.
In the past, the user experience for television based sales has been awkward, and it’s just difficult to imagine people wanting to buy from their television.
But consider this; according to this article on Racked.com, HSN, the 33-year-old shop at home network, sold $2.5 billion dollars in merchandise between live television and ecommerce sales. It’s not that people aren’t comfortable buying from their television, but rather that up to this point, it’s just been relatively niche.
Today, we’re spending an insane amount of time watching video (to the tune of 5.5 hours daily) and yet, we’re not quite buying physical goods directly from the TV yet.
You might argue that’s because the technology to support “shoppable television” isn’t ready, however this report from Business Insider shows that Smart TVs were 54% of the total TV shipments in 2015, and will account for 73% of global flat TV shipments by 2017.
But remember, not all televisions have to be “smart” in order to be shoppable.
In fact, at the time of this writing, there have already been 117 million devices sold that make shoppable television a possibility:
- 65 million Playstation & Xbox devices
- 25 million Apple TVs
- 17 million Chromecasts
- 10 million Roku devices (data from 2014)
- Amazon’s Fire TV sold 3.5 million units in Q1 2015
In total, industry analysts are predicting there will be 86 million streaming media devices sold globally in 2019.
Barbara Kraus, director of research of Parks Associates said in December of 2014 "Nearly 50% of video content that U.S. consumers watch on a TV set is [streaming and] non-linear, up from 38% in 2010, and it is already the majority for people 18-44"
The adoption of connected televisions is important, because on every device there is an app that’s been secretly laying the foundation for TV buying for years; YouTube.
Think about it. Google has been serving ads on YouTube celebrities channels for years, with top personalities earning upwards of $1-12 million annually.
To diversify their revenue streams, many YouTubers partner with companies to create co-branded content tailored specifically for their audience, often driving millions of engaged views. Selling directly is the next logical step.
YouTube’s shoppable ads gives you a glimpse at what this might look like.
In the test Google ran with Wayfair there was a 300% revenue increase per impression. Sephora ran a similar test with a makeup tutorial and experienced an “80-percent lift in consideration and a 54-percent lift in ad recall.”
Now, shoppable ads are only available on the web, and bring you directly to the advertiser’s website, but they’d only need to integrate with Google Checkout if they wanted to make this native to the television.
If they did this, every product review, tutorial, unboxing video, and pre-roll ad has the potential to turn into a hybrid of video and product page that you could buy from without ever leaving your couch.
Even better, because same-day shipping options are becoming more accessible, TV orders could be fulfilled before you’re ready to leave the house.
But what I’m really excited about is what happens once you’re out of the door.
The Rise of the Shoppable Interactive Ad
Throughout my local mall are several giant interactive touch-screen kiosks.
You may have seen something similar at your mall or the last time you were at the airport. They look like this:
They display the directory, show promotions from around the mall, play movie trailers, advertise local businesses, and have games for the kids to play. Savvy advertisers use the NFC function to beam discounts directly to a customer’s phone.
But imagine if the NFC transmitter was used to talk to your phone’s mobile wallet, and the ads used Buy Buttons powered by Shopify’s mobile sdk.
Orders you build on the touchscreen would be sent directly to the retailer who shops for you, leaving you free to eat lunch in the food-court or shop elsewhere until your order is ready for pickup in the express-lane.
If you wanted to buy more than you could carry, or needed to keep certain purchases secret, you could have the order shipped directly to your home or office.
What’s interesting to me however is that this experience could also be tailord to fit smaller, more personal environments that utilize touchscreens:
- In a NYC Taxi where passengers see shoppable ads for anything from gifts to broadway tickets to dinner reservations
- At the gas pump where you might purchase refreshments or car maintenance items
- In an airplane, where you’d buy a new outfit and have it rush-shipped to your hotel before you land
These "micro-moments" where you briefly have someone's undivided attention could be your next direct sales channel.
This concept could be applied to print media as well. For example, Clear Channel communications installed 75,000 NFC enabled outdoor ad locations last year alone and Lexus hints at this future with their NFC enabled print ad in Wired Magazine.
Image via AdAge
The magnitude of how game-changing this all could be is difficult to fathom, but it should get you excited about what comes next and where we can take it from there.
Personally, I’m excited, because this is the first time in 6,000 years, we’re not just painting on rocks, but making those rocks do something that’s never been done before.
About The Author
Tommy Walker is the Editor-in-Chief of the Shopify Plus blog. It is his goal to provide high-volume ecommerce stores with deeply researched, honest advice for growing their customer base, revenues and profits. Get more from Tommy on Twitter.
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