Contextual commerce still finding its way

Oct. 26, 2017 | by Will Hernandez

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Contextual commerce is an emerging trend in the payments and retail industries executives are still trying to figure out given some confusion over the concept.

The early and best examples of contextual commerce happened a couple of years ago when social networks such as Facebook, Twitter and Pinterest introduced buy buttons to enable consumers to purchase products, digital goods and services within the confines of their preferred digital outlet.

A consumer no longer had to leave the Pinterest app to purchase a Nieman Marcus scarf they spotted on someone else's digital bulletin board. They could buy it right then and there.

While the buy button craze is not what it once was, the ability for retailers and others to bridge the gap between digital window shopping and an actual purchase is still a real thing, and some are doing it better than others.

"We have 200 million monthly active users that use Pinterest as a visual discovery tool," Vikram Bhaskaran, head of market development for Pinterest, said Monday during a panel discussion about contextual commerce at the annual Money20/20 conference in Las Vegas. "We think about the core mindset of the user and a lot of the intent is [a] future focus [on buying a product]."

Pinterest is one of a select few companies with a successful blueprint for contextual commerce due mostly to the unique nature of its mobile app. It gives retailers the ability to capture sales via its mobile app through what it dubs Buyable Pins. But the company hasn't stopped there.

It recently launched a feature called Shop the Look, which enables Pinterest users to click on a product in a picture to learn details and can be redirected to a merchant that sells the item.

Pinterest also has a feature called Lens, which enables users to snap a photo of an item on their smartphone as the company's algorithms match the item to relevant pins. The company also plans to invest heavily in its visual search capabilities.

The point of all this is simple: to help consumers make a purchase.

"What's the most obvious way to get [users] to buy in that environment," Bhaskaran said about Pinterest's initiatives.

Pinterest isn't the only one planting its flag in the ground of contextual commerce.

Earlier this year, Amazon aligned itself with high-end clothing retailer Moda Operandi's Instagram posts.

Moda shoppers who view something they want to buy on the retailer's Instagram post can do so using their Amazon login credentials (Amazon Buy). While shoppers can't use Amazon Buy directly in the feed, they're directed via a link to the retailer's Like2Buy platform to complete the purchase.

Patrick Gauthier, vice president of Amazon Pay, said the company's contextual commerce efforts are in place to keep pace with how its 300 million active users chose to shop.

"The number of places where [consumers] can buy items have grown dramatically over the years," he said. "We have to think of what consumers are expecting and they will have access to a broad range of options."

The question going forward for those companies that choose to play in this area will be how to make such purchases as easy as summoning an Uber.

"If it's not easy, consumers won't do it," Mark Lavelle, CEO of e-commerce platform Magento, said during the panel. "From a payments standpoint, it is that Uber affect. The thing that is difficult for a merchant is that it opens up this vast idea of what are the rules in this environment.

"How do I make it easy? That's where it gets complicated for merchants."

Lavelle said merchants don't have to jump into contextual commerce right away as the area is still evolving and that it lacks a true set of "rules" for how to operate in this particular environment.

For example, voice commerce falls under the contextual commerce umbrella, but that area is still evolving.


Topics: In-App Payments, POS, Retail

Companies: Amazon



Will Hernandez
Will Hernandez has 14 years of experience ranging from newspapers to wire services and trade publications. Before becoming Editor of MobilePaymentsToday.com, he spent two years as the content manager for PaymentsJournal.com, a leading payments industry news aggregator and information hub published by Mercator Advisory Group. Will spent four years covering the payments industry as an associate editor for multiple publications in SourceMedia's Payments Group based in Chicago. View Will Hernandez's profile on LinkedIn

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