Using their smart app and audio coding, this startup is exploring new ways to help brands engage with viewers, driving sales
Have you ever been watching a show and all of a sudden a character comes on wearing a jacket that you think just hits your style? But how do you find out which brand it is? How can you pick one up for yourself from the comfort of your couch?
Coming to the rescue is Appiness out of Aalst, Belgium with their set of technologies that allow consumers to identify and buy the items they see on screen, taking the idea of product placement optimization to its logical conclusion.
You are sitting on the couch, watching The Big Bang Theory on TV and you see Penny come on screen wearing a cute yellow top, or Raj and Howard are testing out a new gadget that you would trade your neighbor’s first born for. All you have to do is pull out your smartphone and hit listen on the Spott app to “Shazzam” the items in the scene.
Using the meta data tags that Appiness has synced to the content in coordination with the broadcasters, the app will listen to the content and know exactly what is on the screen, listing which items are being shown. The user just needs to scroll through to pick out what they want and tap on the link to make the purchase.
Alternatively, Apptivate works as a white label that can be integrated into streaming services. In this case, all the viewer has to do to see the details of an item is to hover their mouse over it.
The company was co-founded by CEO/CMO Jonas De Cooman and CEO/COO Michel De Wachter in 2013. Thus far, they have raised €3 million over the course of the past year in two related rounds.
While their target customers are the brands, Appiness finds themselves interacting with a cross section of players in the industry. Beyond the brands who make the product placement deals with the shows, there are the broadcasters and content providers who need to be brought into the mix so that the meta tags can be added to the content. Since their technology makes it infinitely easier to implement this, in return, Appiness pays these parties affiliate fees, creating greater value for all involved.
This model seems to be growing, with all the groups involved liking the idea of increasing their revenue streams.
Back in April, the team launched their first tests with major Belgian broadcasters RTL, VRT and Medialaan. Bosteels says that since then, they have reached over 95,000 downloads for their app and are now fully launched in Belgium. At the time of writing, they had deals with three broadcasters, four TV channels, and 12 programs including House MD, New Girl, Modern Family, Marvel’s Agents of SHIELD, and a variety of local Belgian content.
On the client side, they are already working with names like Carrefour (which is a perfect client to go along with their cooking shows) and Ikea who pretty much has everything to fill a scene.
The value of being a good listener
While it may feel like a simple process of syncing the scenes on screen up with the meta tags, Appiness’s Head of Business Development APAC Herman Bosteels tells Geektime that it was actually quite a challenge to develop it for scale.
He explains that they use a key frame extraction algorithm that was developed with the University of Ghent, basically creating identifying markers that can be easily recognized later.
“They need to go from a video to a keyframe,” he says, explaining that, “These keyframes are the images that are tagged with the items that can then be ordered later.”
Interestingly, they leave the audio as is, choosing not to throw an additional inaudible layer over it. Instead they use an automated listening technology to make sure that the tags match up correctly with what is on screen. Bosteels notes that, “You don’t want to have the wrong images where no items are being shown.”
While this work could theoretically have been done by a human editor, it is very time consuming and open to errors. Perfecting the listening software was crucial for them if they wanted to tackle a wide range of content at scale without making mistakes. That said, they still perform a manual check for the finished product.
To help ensure that the right people are in the given scene, they use image processing to help identify the actors in different episodes. This feature has a secondary purpose, providing users with a “Pinterest for video”, letting them sort through scenes, episodes, actors, products, and brands to find the angle that interests them and share everything directly to social media or through the web app.
Bosteels points out that, “You can also follow other people, giving it a social aspect.” As with every marketing scheme these days, the hope is that users will find new shows and items through their friends, thus amplifying the effect.
Looking East for new markets
Seeking out new opportunities, the Appiness team has decided to give South Korea a go, seeing significant potential when it comes to connecting the wildly popular brands with the regional market.
The Belgians found themselves setting up shop in the Pangyo hi-tech center outside of Seoul after being one of the winners at the first ever K-Startup Challenge initiative that was started by the government to help bring foreign startups to work in the country for a three-month period of acceleration.
A global tech center with companies like Samsung and LG calling South Korea home, there is a strong desire on the part of the government to diversify the economy and see startups as a vehicle to encourage innovation. While there is some skepticism as to whether the country is really ready to commit to the necessary steps that could bring about significant changes to the role of large corporates in the company and invigorate entrepreneurship, the initiative has been a great call for foreigners looking to tap into the local market.
South Korea, for those who are unaware, is a major cultural exporter to the region, including big economies like China and Japan. Locals and their neighbors devour Korean TV shows, movies, music, beauty products, and fashion. K-pop stars can be seen everywhere, promoting products and providing plenty of opportunities for placement advertising. Appiness is already in talks with a major station in Korea, and could achieve exponential growth in the country that has shown a real love for mobile and e-commerce offerings.
Bosteels cites factors like mobile use, e-commerce, and m-commerce, being “really high and very established here,” noting that, “We don’t have to create more, just tap into it.”
“They’re much more primed and open to it,” he tells Geektime, commenting that of course the whole K-pop wave played a role in their decision to open up in Korea. “We hope that it’ll bring us to a much bigger audience.”
Product placement for the digital age
At this point, the users of the Appiness products are mostly female, aged 18-35. Bosteels explains that this is a natural market segment for his company, seeing as how they are active on social media, are used to using cell phones which shortens the step to a second screen, have an interest in what people are wearing and perhaps most importantly, have the money to buy the items.
Looking at these factors, they seem to match up with any other sort of marketing variables, lacking the punch that Appiness seems to be stirring up here. What they have working for them is the power of personal connections to product placement, and the ability to provide feedback to advertisers.
On a basic level, people like to connect with characters they see on TV. You invite them into your home, rooting for them to overcome the odds. The role of product placement then is like any good testimonial: It puts the brand and product on your mind, and hopefully casts it in a good light. How many times have you seen the glow of the apple on the back of a Mac showing up on screen?
“We believe that people today need anchors to hold on to and we provide that through the characters in the videos,” says Bosteels on why he thinks people respond so strongly to products that they see on their favorite shows and movies. “Those anchors are the characters in the series, and we provide an easy way for them to tap into it and associate themselves with it.”
Product placement is essentially the first generation of native advertising, working the ad into the content that people are not going to want to skip over.
Brands spend tens of billions of dollars a year on TV advertising, with eMarketer reporting $68.88 billion being directed at TV advertising last year. This beats out all other formats, including digital which they do note is on course to eventually gain the largest piece of the pie. For the best explanation of how product placement has grown over the years to be a major part of how media gets made, check out this write up from the CBC. It’s ok. I’ll wait.
The question for advertisers is, though, are they really getting the right bang for their buck with this spend? How are they measuring the impact? Vincent Nédée, Head of Business Development EU at Appiness, sees their role as providing the necessary feedback loop as to who is watching ads, and helping to make the path to making a sale that much faster.
“The fact is that product placement before could never be monetized,” he says, continuing that, “Brands had no idea who was watching their product placements. Now brands who have a better idea of whether it is being noticed and know who is actually buying it.”
Getting a good idea of your ROI on this sort of TV advertising is crucial, especially when taking the costs involved into account. Looking for a second at a show like Modern Family, Ad Age estimates that based on their rate for 30-second ad clips that go for $249,388 a pop, it will cost a brand a little over $8,300 for every second that their product is visible. At $344,827 for 30 seconds on The Big Bang Theory, you can do the math on how much companies are paying to be seen by the close to 16.7 million average viewers of the show.
Appiness finds itself at the happy crossroads of new and older technologies, and in a truly delightful way, finds a path to make TV and mobile work in a beautiful harmony.
In many ways, TV is an outdated platform that lacks the feedback capabilities to which we have become accustomed to on apps or the web. Smart TVs and streaming devices like Roku go part of the way in providing data on what kind of ads are being seen, as does YouTube’s TV apps, but it lacks that extra step that makes the experience of shopping that much easier for the user as well as the clear path for tracking product placement in a specific scene and show to the point of sale.
With Appiness, brands can know that their products are in fact being seen in the shows, and receive the best kind of validation, direct sales emanating from the viewers. For the time being, the user is still being brought to an external site to make their purchase, but Appiness has told Geektime that they will roll out an internal shopping option soon.
For a few years now, marketers have attempted to take advantage of listening on mobile devices to get better data and drive user engagement. Back in 2014, Shazam and SoundHound were already being introduced into movie theaters to connect with moviegoers during the preview ads.
The widespread use of mobile phones has made it possible to explore more second screen options for companies like Appiness to get in and shake up the otherwise stagnant product placement segment. As most of us are probably already watching TV with our phones in our hands anyways, apps like Spott gives brands and show producers more ways to engage with their audiences in ways that most users will likely find to be useful.
As a public, we interestingly appear to feel fairly ambivalent about product placement and the role of companies like Appiness in adding extra layers to it. In a very unscientific bit of polling, a number of people asked about the issue told Geektime that they either do not mind having a few noticeable brand names or products in the background, or simply were unaware of the ads being there in the first place. What appeared to bother them was if the product placement interrupted the flow of the story, or was way simply too front and center.
Looking at the trends, consumer attitudes to branding crossing the line into their content has been fading fast. Simply look at the success of BuzzFeed and other creative producers of branded content that integrates products into the stories not as an intrusion but as a fun and important part of the story. And frankly that should be the job of a good story teller, to take the elements of the product and make them work naturally with the show’s characters.
For their part, Appiness is looking to take the established reality of product placement and for those that choose, make it more accessible. Shows that find ways to incorporate smart and unobtrusive items that their viewers will want to look up will find themselves the winners.