Amazon’s Vision of “T-Commerce” Through Prime Video

Need to Know

• Amazon Studios COO Albert Cheng told a panel at this week’s Interactive Advertising Bureau that the company is investigating how to sell goods through its video platform, Amazon Prime.
• “T-commerce”, which refers to goods sold directly through TV screens, is in its “early days,” Cheng said.
• Amazon’s existing fulfillment network alleviates the pitfall other companies have had when experimenting with T-commerce.
• The company has already seen some early success with Making the Cut, a reality program streamed on Prime that allowed viewers to purchase items made by the winning contestants.

Analysis

Amazon is exploring bringing commerce directly to television, a senior exec with the company told a panel this week.

Speaking at a panel hosted by the Interactive Advertising Bureau, Amazon Studios COO Albert Cheng said T-Commerce — which is the selling of goods directly through television screens — is in its “early days,” but added that Amazon has long wanted to “leverage the reach of Prime Video and marry that with commerce.”

Amazon has already had some success with T-Commerce, most notably with Making the Cut, the reality fashion competition program hosted by Heidi Klum and Tim Gunn which streamed on Amazon Prime. That program allowed viewers to purchase items designed by the winning contestants directly through Prime, demonstrating Amazon’s ability to circumvent the issue that has plagued other businesses who have experimented with T-Commerce: fulfillment.

“You’re asking customers to do two things — focus on story and then figure out what you want to buy. Oftentimes, we didn’t see a whole lot of engagement because people at the end of the day really want to watch their soapy shows,” Cheng, who joined Amazon from ABC, said at the panel. Cheng cited the ABC series Scandal as an example of this disconnect: customers may see an item worn by an actor on the show that they would like to purchase, “but they’re not going to buy it while they watch the show. They’re going to go online and try to find it.”

With Amazon, however, there exists the ability to “tie television and buying all in the same platform” thanks to the company’s “massive, global infrastructure and delivery systems,” Cheng continued.

The move to bring commerce directly to TV would mark a huge step for Amazon, effectively establishing a new commerce channel for the already-massive retailer. It would also be in line with existing e-comm trends, such as the increase in social selling, specifically live-streamed video events that sell items directly to consumers. Walmart, for instance, recently tested livestream shopping with TikTok, for a holiday selling event in December that allowed users to purchase items they saw on the TikTok livestream directly from Walmart. Home shopping channel QVC is also using livestream shopping: the company launched channel on YouTube TV in February, making it the only livestream shopping channel on that platform.

Amazon has demonstrated its commitment to retail innovation in recent months, launching a number of new digital tools and programs aimed at increasing customer engagement and responding to pandemic-born commerce trends. Last month, the company announced Build It, a new program that allows Amazon shoppers to crowdsource which product the company will build next. Amazon has also recently launched a digital pharmacy platform, and introduced Amazon One, a contactless, pay-by-palm payment system, in September of last year.