Content Must Become the Marketplace for Purchases
In an era where consumers discover products while engaging with content, the entire sales funnel needs a revolution. This sentiment was echoed by Sung Dong-hoon, Head of Platforms at CJ ENM’s Commerce Division, during a recent industry forum. He emphasized that content itself must evolve into a direct pathway for purchases, transforming the traditional consumer journey.
The Shift to Discovery Shopping
Sung Dong-hoon highlighted the significant and rapid changes in how consumers interact with and purchase products. This evolution necessitates a strategic shift for both retail companies and brands. He noted that the influence of “discovery shopping” – where consumers encounter and buy products incidentally while consuming content – is rapidly growing within the e-commerce landscape.
Consumers are already adept at gathering product information through social media platforms. The buying experience is moving away from a text-centric approach to one that prioritizes visual content like images and videos. Unlike the past, where consumers actively searched for specific items on portals or shopping platforms, there’s a notable increase in discovering and purchasing products through content on platforms like YouTube, Instagram, and TikTok.
Rethinking the Marketing Funnel
Sung explained that consumers now encounter brands at numerous touchpoints, leading to a purchasing experience that is significantly different from traditional models. The conventional marketing funnel, which focused on awareness, consideration, interest, and conversion, is no longer sufficient. The emphasis is shifting from maximizing advertising efficiency to captivating consumer emotions.
He stressed the critical need for companies to develop strategies tailored to this new discovery shopping environment. Even platforms and brands traditionally focused on goal-oriented shopping, where consumers search for predetermined items, must adopt a discovery-oriented approach when launching new products.
CJ ENM’s Content-Centric Strategy
To address these changes, CJ Group is actively pursuing a strategy that positions content as the primary marketplace. This involves moving beyond simple product introductions to creating content that showcases the expertise and lifestyles of sellers and influencers. This approach fosters deeper connections with consumers.
Examples of this strategy include showcasing a product within actress Yoo In-na’s skincare routine or curating cleaning and organizing products through singer Biao’s tidying sessions. Sung emphasized that while anyone can introduce a product, content that merges a person’s lifestyle, backed by expertise and strong recognition, is becoming crucial. This content generates intellectual property (IP) that holds significant value.
Leveraging Short-Form Content and AI
Furthermore, CJ Group is repurposing hour-long live broadcasts into short-form content, distributing it across various platforms like YouTube, Instagram, and TikTok. Sung stated, “Content must go directly to where the customer is.” The company is currently producing around 1,000 short-form videos per month, with a long-term goal of expanding this to 10,000 monthly videos.
Artificial intelligence (AI) is also playing a role in this strategy. Sung noted that the objectives for using AI must be clearly defined first. The company is analyzing hundreds of factors to understand which short-form content resonates most with consumers and is building automated systems to segment one-hour videos into short-form content.
He added that in the AI era, customer needs are changing rapidly. Retail businesses and brands must embrace innovation by conducting small-scale experiments with AI and rapidly validating their findings.
