Short-Form Video is “Taking Over” from Live Shopping in the US

Dan Meier 21 May, 2024 

As retail media emerges as the fastest-growing segment in advertising, video is becoming a key driver in its meteoric rise. In 2018 a Brightcove and YouGov survey found that 76 percent of consumers have made a purchase after watching a video. As a result, tech companies have increasingly explored ways to connect video and shopping. One of the first movers in this space was CommentSold, a video commerce platform launched in 2017, enabling Shopify retailers to host shopping livestreams on social media platforms.

Since then, the path to purchase has shortened even more. For livestreams on Facebook and Instagram, consumers can comment on a video and instantly receive a DM which takes them to the retailer’s checkout – hence the name CommentSold. The company also provides the vendor with a website and mobile app, and handles the full process from livestream to payments and shipping.

And TikTok has shortened that user journey further still, with transactions taking place on the short-form video platform itself. For CommentSold CEO Gautam Goswami, the company’s integration with TikTok is particularly valuable, allowing users to purchase directly on the platform. “I wish Instagram would do the same thing, so we could just have a lot more conversion on Instagram feeds, because there would not be that need to go somewhere else,” he comments. “There’s a drop-off because of that.”

Shoppable shorts

TikTok’s live commerce functionality has made it a cornerstone of the shopping experience in China, where an estimated 25 percent of online sales took place through livestreams last year. But as Goswami explains, in the US it’s a different story: “Live selling did not take off in the US, that’s the reality of the matter.” However, CommentSold has observed a shift away from live selling towards shoppable clips, particularly on TikTok. “Video clips are taking over even more than live in the US,” says Goswami.

To that end, the firm launched a new feature last month called AI ClipHero, which uses AI to clip shopping livestreams into short, interactive videos. These are then automatically placed on the shoppable feed on the seller’s app. Goswami notes that this TikTok-like feed provides consumers with the scrollable experience they are used to on the ByteDance app, but brings them onto the merchant’s own property. “The customer buys from from a shop in TikTok once, twice, three times, then they’ll look up the shop, and download the shop’s app,” he says.

This also dilutes the company’s reliance on TikTok, which has clear advantages when the Chinese firm is facing a ban in the US. “If TikTok goes away, that’s going to hurt our business, there’s no doubt,” says Goswami. “Is that going to be catastrophic? I don’t think so. I think it will be hurtful for a moment, but we are happy to survive without it.”

Goswami argues that while TikTok is a big part of CommentSold’s business, it is not the only game in town. “Adoption is driven by consumer behaviour, and consumer behaviour is being driven by social media channels,” he remarks. “Forget about TikTok; even if TikTok goes away, Reels on Instagram are the first engagement. If you are keeping your store all static, you risk losing the attention of Millennials and Gen Z, because they’ll want to see the product on a creator first. If they can actually see that whole creator’s video inside the Shopify app, that changes the game. That will drive the adoption of shoppable clips.”

Opening the floodgates

On the other hand, the prospect of social media feeds being flooded with people selling products risks turning off consumers – and attracting the scrutiny of regulators. Earlier this year, the European Commission revealed that 80 percent of influencers failed to flag paid-for content. And while independent businesses are likely to play by the rules, they could find themselves caught in the crossfire.

Goswami predicts this will lead to a clearer delineation between entertainment and shopping platforms. “When people are in entertainment mode, they don’t necessarily want to buy,” he observes. “Look at TV; if you think that entertainment and shopping can go together, television with QR codes should have been there.”

He therefore expects shoppable-only apps to spin off from social media companies in the next five years; destinations for the specific purpose of browsing products, separate from the social apps whose own shopping content will decline.

“I’m already seeing a lot of pushback here from our customers and our viewers and our creators,” says Goswami. “TikTok is showing a shoppable video every three swipes. I’m here to just entertain myself right now, stop pushing me products! It also makes you feel like you’re being spied on, because you watch a video of a particular vacation destination, and the next 10 minutes you keep on getting ads for that destination. That’s just not fair, it feels so intrusive.”

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