NBCU wants to bring the e-commerce model to TV
In May, NBCUniversal started putting interactive, shoppable ads on morning broadcasts of the Today show.
Lacoste ran a ShoppableTV spot during the French Open
The network soon expanded the test to broadcasts of the French Open, and now it has executed a total of five shoppable campaigns across its portfolio. A shoppable ad will also appear during a commercial break of a Sunday Night Football game on NBC sometime before year’s end.
Josh Feldman, executive vice-president, head of marketing and advertising creative at NBCU, said the network sells ShoppableTV ads as a show integration, and then negotiates a percentage of sales revenue on the back-end.
“Internally we always say this is taking the ease of mobile e-commerce and matching it with the scale of NBCU's portfolio and audiences,” said Feldman.
Walmart, Lacoste, Roli, Zwift and Callaway Apparel have all signed on as partners, with Feldman adding that there will be “a couple more” brands involved before the end of the year.
ShoppableTV ads appear at the bottom of the screen advertising a product relevant to the broadcast. For example, Callaway Apparel, a golf lifestyle brand, ran shoppable ads on The Golf Channel.
A viewer can then scan the QR code inside the ad with their mobile phone and be taken to the brand’s product page to potentially purchase the advertised item. NBCU said the “sweet spot” is around 30 seconds of air time for the ShoppableTV ad.
NBCU is banking on interactive ads in the lean-back TV environment finally catching on, a goal for both programmers and marketers since at least 2009.
YouTube, which just brought shoppable ads to the home and search pages on its mobile platform, is even taking a deliberate approach to extending the ad product to video pages, citing the different behavior users show when browsing for content versus watching videos.
Feldman, though, said he thinks advertisers have been dreaming of something like ShoppableTV for years.
“You're watching a program, you see something you like, and you want to buy it immediately,” said Feldman. “The fact that we've created this way to do that, totally frictionless, literally by pointing your camera at it... advertisers and retailers are seeing the benefit of that.”
Social and email promotion accompany the TV spot. Alex DePallo, brand marketing manager for Callaway Apparel, said this multi-media approach has helped drive brand awareness and product research.
The added bonus is direct sales, and the data that comes with it, from a consumer base that’s getting more comfortable with using two screens at once.
“I think customers now are very in tune with using their second screen as a research tool, whether that's through ShoppableTV or that's in store,” said DePallo.
NBCU is claiming ShoppableTV ads drive 27% higher conversion rates than the industry average. NBCU would not share specifics on how it got to that number, saying it “used the general industry standard for e-commerce conversion as our baseline”. BigCommerce puts average e-commerce conversion rate at 1%-2%.
Feldman acknowledged that conversion is unlikely to happen immediately, saying it usually takes “between five to seven exposures for people to buy things”.
“But then again, that's the beauty of NBCU,” said Feldman. “For those advertisers that are national advertisers, we're able to run their ads and set them up with what these products are before we do a shoppable experience. We're able to affect every single layer of the purchase funnel.”
ShoppableTV ads run across NBCU's broadcast and cable footprint and, depending on the show, in a three-day window on video on demand. The ads don't yet run in NBCU's over-the-top offerings.
Feldman added that innovative ad types were a “very big part” of NBCU’s recent upfront talks with clients. The network is also testing what innovative ad formats to bring to Peacock, its streaming service set to launch in April.
“There's definitely going to be very innovative ad formats on Peacock,” said Feldman. “We're looking at Peacock as a way to really change the structure of what advertising as we know it can look like.”