November 29, 2016
Given that three-fourths (75%) of the world’s mobile data traffic will be video by 2020, there is a strong chance that the future of mobile payments will migrate from buttons in apps and mobile-friendly web pages into video-embedded options.
In its recent study, Cisco explains that mobile video will grow at a CAGR of 62% between 2015 and 2020, higher than the overall average mobile traffic CAGR of 53%. Of the 30.6 exabytes per month crossing the mobile network by 2020, Cisco estimates that 23.0 exabytes will be due to video. Mobile video represented more than half of global mobile data traffic beginning in 2012, indicating that it is already affecting traffic today, not just in the future.
Video has been noticed as an attractive platform for commercial interaction by financial institutions that review it as a possible alternative for physical branches. In fact, a report on video banking by Vidyo, a visual communication platform company, suggests that by 2017, almost 80% of all banks will plan to launch a video banking service in the long term.
In-video payments systems are not limited to commercials and other forms of short features, good ol’ product placement can finally be employed at the spot. A major advantage of in-video payments, in this case, is in the ability to measure the effectiveness of spent funds and significantly boost the profitability of any business.
The technology to place the system in movies, for example, already exists – Amazon, for example, displays information about playing actors in real time for every movie scene in its Amazon Prime TV shows. There doesn't seem to be a limit to displaying information on actors only – Amazon’s e-commerce business can get to a whole another level if, during the show, the information on clothing, gadgets and furniture were to be displayed with an opportunity to proceed with a checkout right in the video while watching the movie.
The idea and the realization may seem to be still raw and there is not much of a market for those types of solutions globally. There are, however, a few companies working on very interesting systems to harness the power of video in communicating value.
One example is Soundpays, which allows pairing a device with a TV and a laptop and buy a product that’s being advertised at that moment right away. Imagine watching a TV commercial and wanting to buy a product that’s being advertised. The natural reaction would be to either call and order it or, for the younger generation, to reach for a phone and browse company’s website to find that product. Soundpays eliminates any sort of friction as it allows to just open the app and execute the order. The company creates an opportunity for a painless impulsive purchase without a second to change mind.
IntegraPay is another, quiet fascinating, case. IntegraPay launched a world first innovative technology offering in-video payment solutions, which allows businesses or charities the opportunity to make sales and donation through videos by accepting payments right inside videos. The technology has been reported to be released in the US where it boasts a 27% cost decrease during the sales funnel process and an increase in the conversion rates for product sales.
The scale of video consumption makes it an imperative necessity for businesses to utilize video content to reach the target audience. While an ever-expanding pool of mobile payments solutions are running into a wall with a highly fragmented market, in-video mobile payments systems can become the next breakthrough in ensuring the relevance for the modern consumer.
Moreover, in-video payments are not even restricted to ‘real’ video. While some may be shopping for fashion show runway dresses while watching them live on TV, others may do the same while watching those shows later through VR technology. With VR having a great chance of becoming the next big thing in retail (by 2018, an estimated 170 million people will own VR products worldwide), embedded payments solutions can as well migrate into the virtual reality to indicate pricing for every item on the show and allow users to fill out a checkout form in less than a minute.
In-video payments also seem to be a natural choice given the growth and an outstanding popularity of such video and movie streaming platforms as YouTube, Netflix, Hulu and others. Moreover, as some studies suggest that average Americans from age 2 to 65+ watch TV from ~21 to ~51 hours weekly, in-video payments are a whole new frontier for businesses to reach affectionate audiences in a profitable manner. In-video payments can become a holy grail of effective fund allocation and measurement of ROI on extremely expensive video content.