Infomercials have become the latest advertising format to meet their match among mobile-first Millennials.
MikMak, a mobile video shopping app that launched for iOS in June, utilizes improvisational comedy talent in 30-second videos to sell $100-or-less products, primarily accessories, gadgets, home goods and anything else without a size, directly through the app. It releases new videos every day at 9 p.m., handles payment through an in-app shopping cart and leaves the shipment up to each vendor.
Today, MikMak is expanding with a monthly series of “minimercials” with brands American Express Open, GE, Oxygen Media and Mondelez International’s Swedish Fish. The format and production will be like previous videos on the app, but this will be the first series on the app, and videos will be viewable on other sites using an embeddable player.
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Founder Rachel Tipograph, who was the former global director of digital and social media at Gap, said that MikMak was the first mobile-video shopping network and is now the first platform for distributed mobile-video commerce. The first brands to participate in the series, “Blank Presents” are ones that, since launch, are selling products that MikMak is designed for in terms of brand affinity and sales, Tipograph said.
“For example, gadgets are one of our top-performing categories, especially smartphone-connected products, so it made a lot of sense for us to collaborate with GE.” “GE Presents: Conversations over Dim Sum” sells its LED Bright Stik and smartphone-connected LED bulb and is hosted by “Comedy Central” performer Eliot Glazer. GE chief marketing officer Linda Boff said that MikMak was “a great platform to engage with Millennial customers who may not go to a traditional home store to buy lightbulbs.”
The app and the series converge a number of recent trends including mobile video, shopping using videos, native advertising and shopping within an app.
According to recent research from Forrester, U.S. mobile commerce, meaning shopping on a smartphone or tablet, will reach as much as $252 billion by 2020, a 17 percent compound annual growth rate from 2015. The research also found that 85 percent of the time spent on phones was spent on apps.
Using videos to inform purchasing decisions is on the rise. According to research from Google, one in five 18- to 24-year-olds say they go to YouTube to find out “what’s cool to purchase,” and in the past year, YouTube has seen more than 40 percent growth in viewership of product videos. A 2013 report from eMarketer estimated that U.S. ad spending on mobile video would be $2.1 billion by 2016.
Tipograph said she “stumbled into” the power of video commerce, and the estimated $250 billion infomercial market, while she was at Gap, and that creating shopping commercials for the Snapchat generation means that the word “entertainment” is key. She found that the majority of mobile commerce is pre-shopping and discovery, but conversion to actually making a purchase was often relegated to utility purchases or with loyalists of certain brands.
“People are not ready to make impulsive luxury payments on their phone,” Tipograph said of the $100 threshold for items sold on MikMak.
MikMak works with more than 100 vendors and sees an average conversion rate “much higher” than the average mobile shopping conversion of 1 to 2 percent. Investors in its $2.15 million seed round include Vayner/RSE, UTA Ventures, Slow Ventures, CNN Worldwide president Jeff Zucker, and Google Glass head Ivy Ross.