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Driving Online Sales with Video

Innovating with video e-commerce

May 21, 2010

Retailers are responding to the growing consumer appetite for online videos by adding them to their Websites both to differentiate themselves from competitors and to keep up with what consumers expect from their online shopping experience.

“Consumers rank other purchase decision-making tools, such as customer reviews, ahead of videos in importance,” said Jeffrey Grau, eMarketer senior analyst and author of the new report “Video E-Commerce: Innovative Models Drive Sales. “But that has not discouraged retailers from quickly adding videos to their sites. They find that videos boost sales conversion rates and reduce abandoned shopping cart and product return rates.”

The proportion of the top 50 US online retailers offering videos jumped 378% in 2009 over the year before, according to a Forrester Research study, “Online Retailers’ Adoption of Online Video Content Is Ahead of Consumers’ Preferences,” published in November 2009. Last year over two-thirds of the biggest online retailers hosted videos.

Percent of Top 50* US Online Retailers that Offer Videos on Their Site, 2008 & 2009

The adoption rate is poised to climb further, as revealed by a February 2010 Multichannel Merchant survey. Among the two-thirds of respondents who indicated they were planning a site redesign in the next 12 months, some 42.3% said they would add video to their site. That makes it the second-highest priority, well behind social media tools but ahead of other popular Website enhancements including customer reviews and personalized recommendations.

Features that US Multichannel Retailers Plan to Add to Their Site*, February 2010 (% of respondents)

“Retailers are making the case that videos boost their sales conversion rate, a measure of the increase in the percentage of shoppers who make a purchase after viewing a product video,” said Mr. Grau. “Retailers also claim videos reduce shopping cart abandonment rates and lower product return rates.”

Check out today’s other article, “Getting Shoppers into Stores with Mobile Apps.”

The full report, “Video E-Commerce: Innovative Models Drive Sales,” also answers these key questions:

  • How fast have retailers and consumers embraced video e-commerce?
  • How do consumers rank videos against other online purchase decision-making tools?
  • How do retailers benefit from featuring videos?
  • What are some of the innovative ways retailers use videos?

To purchase the report, click here. Total Access clients, log in and view the report now.


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