American Express Pushes E-Commerce to TV Commerce
The reference is old, but the idea remains new -- and seems closer to becoming a reality.
With all the wondrous advancements in video technology -- interactivity, "second-screen" social chatter and more -- marketers have long asked why consumers couldn't see an object or product placed strategically in a TV show and instantly express a desire to buy it (a very different prospect than buying something cute or strange on Home Shopping Network). For years, marketers have dreamed of viewers who would be able to "buy Rachel Green's sweater," a nod to the character portrayed by Jennifer Aniston on NBC's long-running "Friends."
American Express has been trying to make those visions come to life. Late last year, the financial-services company partnered with cable networks owned by NBC Universal as well as News Corp.'s Fox broadcast outlet to dabble in a nascent world in which TV viewers make a decision to buy certain items in scripted shows on the screen in front of them.
At NBC Universal, American Express took part in a plan that let viewers purchase products "inspired by" NBC Universal programs directly from a mobile device while the programs are airing. The company's DailyCandy website selected the products that might appeal to viewers of shows such as Bravo's "Life After Top Chef," E!'s "Fashion Police" and Style's "Tia & Tamera." American Express card members could receive $35 back when they use an eligible American Express Card, synced with their Facebook or Twitter accounts, to purchase one of the products.
At the center of the concept was Zeebox, the social-TV app in which NBC Universal and its parent Comcast Corp. took a stake earlier in 2012. The app, which works on certain tablets and smartphones, lets users converse in real time with friends who are watching the same show, or follow related Twitter and Facebook feeds. It also offers information about how to purchase show-related items such as couture and kitchenware.
Over at Fox, American Express sponsored an effort that allowed viewers using the new Fox Now iPad app to shop in real time while watching "New Girl." Each week, "New Girl" featured at least one item -- which could be a piece of jewelry or a household item like salt-and-pepper shakers -- made available for purchase.
Will buyers of salt shakers today move on to move expensive items tomorrow? The hope is that couch potatoes -- or whatever the equivalent of a hardcore TV fan is in 2013 -- will start out with small doodads -- more a novelty than anything else -- and grow more comfortable shopping in this fashion, said Lou Paskalis, VP-global media content development and mobile marketing at American Express. "Our mission is to connect different buyers and sellers together," he said.
What American Express is actually doing, however, is making a bet on the future of TV (or whatever set of devices and behaviors ultimately replace it). Is television to remain a one-way funnel of content that gets piped in to the living room from Big Hollywood, or is TV's content something that can prompt chatter and response -- and purchases -- as new technology eliminates many of the differences between the TV screen and the tablet window or computer monitor?
These are riddles advertisers will need to solve as the demographic they most like to woo -- consumers between 18 and 49 -- undergoes a radical shift. With the baby boomer generation heading into its 50s and 60s, the population swatches known as "Generation X" -- ages 33 to 46 -- and "Generation Y" -- ages 24 to 32 -- are taking over.
According to market-research consultant Forrester, more than a third of so-called "GenXers" have a household income of more than $100,000, and have the highest spending levels online. Forrester reported Gen Xers spent an average of $561 online in the three months ended January 15, compared with an average of $449 for all U.S. online shoppers. Meantime, "GenYers" are most savvy about using mobile devices to get things done. The group has the highest adoption rates, according to Forrester: 25% of online consumers in the age group own a tablet and 72% own a smartphone.
But what neither group wants is a group of ads getting in the way of their TV programming or how they use their new gizmos. That's why American Express sees partnering with content producers to be of benefit, said Mr. Paskalis -- TV viewers would rather converse about what drew them to their screens in the first place -- the programming -- more than nearly anything else.
"Put the consumer first. Give them the choice. Let them decide. Don't talk at them. Reason with them, he said. "This is meant to do that."
Fox, NBC and their rivals are experts in the business of selling their programming, but they may want to dip their toes into the business of e-commerce as well. To be sure, many networks are involved in licensing rights to various parties for the creation of merchandise around their top pieces of content, but helping sponsors sell actual goods from the screen is a different type of enterprise.
"As viewer habits change and technology continues to evolve, and scale gets more elusive, context and impact mean everything," said Linda Yaccarino, president of NBC Universal ad sales during a November interview, noting that more sponsors were seeking ways to play off the content their advertising supports instead of just running commercials that have little to do with the programs.
Fox also expects more advertisers to seek out similar ideas. Advertisers "are looking for more interaction" when they do deals that tie them to specific programs, said Jean Rossi, president of News Corp.'s Fox One cross-media sales unit and exec VP-sales for Fox Broadcasting Co., in a November interview.