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COMMENT: How to solve a problem like Netflix shopability


By Criteo vice president Liva Ralaivola

Amid the continued economic pressures on households, recent figures from major streaming services like Netflix have shown strong quarterly subscriber growth. This bodes well for streamers looking to flaunt their newly launched ad-supported tiers to the retail sector.

Still, impressing brands and creating a viable commerce channel isn’t purely about maximising the number of eyes on screens. Many audiences lauded Netflix and Disney+ precisely because they were fatigued with mid-stream advertising. As such, monetisation efforts will need to reassure brands that ads can deliver better experiences.

It’s also important to have in mind that CTV devices are still commonly used in ‘household’ settings and offer no click-based interaction with ads shown, making the level of targeting and measurement many brands require much harder to obtain.

To appeal to a wider audience of prospective advertisers, CTV must lean into some of the very latest capabilities enabled by AI and evolve beyond its roots as a ‘top of funnel’ channel, working harder to connect what audiences see with meaningful, lower funnel commerce opportunities.

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Means of making shoppable ads

One of the reasons mid-stream ads are such a compelling option is the complexity of the CTV world. Unlike web or app environments where Google and Apple reign supreme, any new shoppable elements must be built for at least nine different operating systems – from Apple TV to Samsung’s Tizen.

However, better ad experiences can be achieved by building into existing features. A great example would be Amazon Prime’s X-Ray. Audiences already use it to explore cast information like actor bios and trivia, but they could just as easily use the same X-Ray feature to explore the garment of the actors or the furniture shown in the image.

Taking this idea even further, producers might even try new ways of making movies and TV shows, where ‘green placements’ – the equivalent of a green screen used to imprint special effects in post-production – would be left vacant, to be populated by the most relevant and personalised product in real-time. Given the advances of AI this scenario might well be at our fingertips, particularly when you consider a more basic form of green placements is commonly used throughout sports events when TV viewers see flags, scores and free-kick circles imprinted on the field.

To best leverage these shoppable moments, AI will certainly play a key role in helping understand the content of the video (including sound and subtitles) to recommend relevant products. The visual search capabilities offered by AI could also be key to map the clothing of actors, or furniture of a scene, towards partnering brands.

Introducing ‘clicks’ to CTV

To tackle CTV’s enduring absence of click based interactions, streaming must do more with mobile devices. For instance, commerce could be integrated into mobile-friendly elements such as Netflix’s short, vertical ‘Fast Laughs’ section, by implementing a list of products into a cart viewed at the end.

Games should also be considered as part of the commerce mix; Netflix has several games derived from popular shows such as Stranger Things and Narcos, presenting the opportunity to retarget fans of the shows with related merchandise and apparel.

In the long term, new formats will have to be invented to take advantage of the dual screen browsing experience. As is the case in traditional digital advertising, advanced AI will be key to tweaking and tailoring how promotional content is displayed across different combinations of devices and across different formats – from a phone’s lock screen to within social media apps.

Connected commerce experiences

Such front end changes certainly would entice brands, but convincing them to invest hard earned budgets will take several enhancements on the measurement side.

In particular, the ongoing challenge of determining interest. Advertisers will want streamers to prove they can detect the interest of a user from their interactions through a remote control or mobile app. Here again, we can expect AI capabilities will come into play to interpret real human interaction, value the impact of those interactions with ads and calculate fair pricing.

Building a compelling measurement story also means proving the lower funnel actions audiences take. This relies on the commerce data retailers like Tesco, Boots and Sainsbury’s are increasingly able to offer up. Through first-party data matching, the impact of ITVX and All 4 campaigns on actual product sales can now be immediately measured, all because of their retailer partnerships.

This carries significant benefits for brands in terms of media optimisation, but it will also enable TV reach and frequency to become far more precise, opening up the possibility of higher ad loads and more revenue for streaming services – all while providing relevant, valuable experiences for audiences.

In this way, AI paired with first-party retailer audiences has unlocked the ability to create relevant commerce experiences for customers wherever they choose to spend their time online. Moreover, there’s so much potential for experimentation over the next few years in where and how such commerce experiences are created.

Whether we see X-Ray like features or more green screen placements land first, we can be sure that the consumer relationship with advertising will be positively impacted, marking a significant step forward.

Image credit: Shutterstock

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