If the shoe fits, make a video of it and watch your sales increase. This simple formula has been part of the Zappos.com recipe for success as an online retailer.
The quirky company with fanatical customer service started selling shoes in 1999, was bought for $1 billion by Amazon in 2009, and has become the Internet’s largest footwear retailer. With fresh video directives and a shiny new platform partner in Kaltura, Zappos.com continues to be an excellent benchmark for product videos. But what are the secrets to its success and how can companies learn from this ecommerce powerhouse?
With almost $200 billion spent online last year according to the February U.S. Commerce Department report (PDF download), analysts are predicting a 15 percent increase for 2012. As online spending and competition grows, Internet retailers are looking at ways to increase visibility, connect with customers, and sell more goods. Product videos are not a new concept, but the amount of videos being produced is rising exponentially — and more potential customers are watching. A 2012 Internet Retailer survey found 60 percent of customers watched product videos online. It estimated that 170 million Americans (over half the population) will watch product videos in 2012. While percentages vary, sites have found that customers are up to 64 percent more likely to buy after watching a product video. Zappos.com has reported that its conversion rates range from 6 to 30 percent. The bottom line is more eyeballs are watching, and that dramatically increases the buy decision.
The success secrets of Zappos.com can be boiled down to three simple rules: Stay true to the brand, build a clear strategy, and jump all in. Companies using product videos can learn from the example Zappos has set.
Stay True to the Brand
Any company that asks you “How weird are you on a scale from 1-10?” during a job interview probably approaches its business from a non-traditional angle.
From the beginning, CEO Tony Hsieh wanted to create a customer-focused business whose core values include creating “wow” experiences, encouraging fun and weirdness, and building open and honest relationships. Hsieh has pushed employees to use social media and create videos to tell their own stories. The site has a video experience page where customers can upload their own Zappos stories.
That playful and human-centered approach to business continues in Zappos’s original product videos.
Most product pages on Zappos.com contain a video link in the product description. Product videos are hosted by content coordinators who create their own scripts, matching their personality and the item they’re talking about. These one-minute-or-less videos begin with the coordinator on a stark white background introducing themselves and then, in their own style, describing the product. The effect is liking talking to a good friend — a friend explaining what he or she likes about a favorite shoe, bag, or hat.
In the video for the Nike5 Elastico indoor soccer shoe, for example, host Andrew describes the shoe and then accidentally drops it. It’s silly but that’s part of the brand. Zappos’s videos feel real because they are real — and customers love them. Companies that implement product videos need to create content that supports the brand and engages customers in real conversations.
Build a Clear Strategy
The most important measurement in video ROI (return on investment) for Zappos is not an increase in sales. As Laurie Williams, senior manager of photo and video for Zappos, says, ”While we are definitely seeing an increase in conversion, more importantly we are seeing a decrease in returns.”
Zappos.com offers a 100 percent satisfaction guarantee with a 365-day return period. In the age of online shopping, customers need to feel that they know exactly how an item will look in real life. A recent Website Magazine report showed that customers who viewed a video prior to buying were 52 percent less likely to return it.
“We see a cost savings with fewer expensive shipping returns. More important, the customer does not become disenchanted. Our goal with our product videos is to enhance the overall shopping experience,” says Williams. Zappos shows that there’s more than one way to measure success.
Jump All In
The final secret to Zappos’s success is less about planning than action. The twelve-person Zappos video team is directed to shoot a video for every single item that comes into the Shepherdsville, Kentucky, warehouse. During its lifetime, the video team has produced over 200,000 product videos. Approximately 40,000 videos are live on Zappos.com at any given time.
To keep up with the constant flow of new products the video team produces around 2,300 videos every week. The team’s five filming bays each have a camera operator and content coordinator who pass off raw videos to two editors.
As customers experience more sales videos, they’ll expect to see a video for each product. This “all in” approach to producing content has forced Zappos to graduate from its home-grown video solution to Kaltura’s open source video platform. Zappos is currently migrating its videos to the new platform and looks forward to taking advantage of tagging, metadata, and the ability to scale its operation.
While Zappos is focused on building its own internal video network, it continues to syndicate videos to the Zappos YouTube channel. With over 21 million views and direct traffic to product pages, the “all in” approach seems to be working. The lesson for companies here is take the plunge, build a team, and crank out the content.
The future looks bright for Zappos and its video team. With new offerings in the pipeline — such as ZapposTV with video buying guides, user-generated product reviews, and video partnerships — Zappos will continue to lead the way in creating sales videos with a funky, fun flair.