The battle among short-video platforms has extended beyond user engagement metrics into the realm of e-commerce. As consumers increasingly turn to bite-sized video content for both information and entertainment, platforms are racing to capitalize on this behavior by integrating seamless shopping experiences. YouTube, the video-sharing behemoth, has now officially joined this competitive landscape.
YouTube Shorts Embraces E-Commerce Functionality
YouTube's short-form video product, Shorts, launched in 2020, will now incorporate shopping features allowing users to purchase products directly while browsing videos. Currently available to users in the United States, India, Brazil, Canada, and Australia, the platform plans to expand this service to more creators and countries in the future.
In addition to direct purchasing capabilities, YouTube is testing an affiliate program in the U.S. that enables creators to earn commissions by recommending products in both Shorts and regular videos. This pilot program, still in its early stages, is expected to gradually expand to more creators throughout 2023.
YouTube has positioned itself as the ideal platform for creator entrepreneurship, with shopping representing a crucial component of this vision. The company clearly expects Shorts to become a significant revenue generator through video commerce, with the affiliate model serving as a powerful incentive for content creators.
Enhanced Revenue Sharing to Boost Creator Engagement
To further motivate creators, YouTube announced that starting next year, participants in its Partner Program will receive 45% of advertising revenue from their Shorts content. Beginning in early 2023, creators meeting specific thresholds—1,000 subscribers and 10 million Shorts views over 90 days—can apply to join the program.
While YouTube Shorts has achieved remarkable success with over 1.5 billion monthly active users, parent company Alphabet reported disappointing quarterly earnings for YouTube, with advertising revenue declining by 1.9% year-over-year. In this challenging advertising climate, the new shopping features may represent an important diversification strategy for YouTube's revenue streams.
The platform has been steadily transforming into a shopping destination in recent years, having previously introduced shopping advertisements. The expansion into short-form video commerce represents a natural progression of this strategy.
Intensifying Competition in Short-Video Commerce
YouTube isn't alone in recognizing the potential of short-video shopping. Both TikTok and Meta are aggressively investing in this space, setting the stage for intense competition.
TikTok recently began testing its shopping feature in the U.S., allowing direct in-app purchases. This follows earlier rollouts in the UK and Southeast Asia. The company has also partnered with Shopify to pilot TikTok Shopping in the U.S., UK, and Canada.
Meta's Instagram enables influencers to showcase products during live streams and through dedicated shopping tabs, where users can browse recommendations and make purchases. Brands can also create shoppable profiles through product catalogs.
As short-form video consumption becomes increasingly dominant, integrated shopping experiences are emerging as the next frontier for digital platforms seeking to capitalize on this behavioral shift.
Strategic Considerations for E-Commerce Sellers
The introduction of shopping features on YouTube Shorts presents new opportunities for cross-border e-commerce sellers. Effective strategies include:
- Creating high-quality short videos that demonstrate product features, usage scenarios, and customer testimonials
- Optimizing video titles and descriptions with relevant keywords
- Utilizing appropriate hashtags to improve discoverability
- Collaborating with influencers for product endorsements
- Leveraging YouTube's built-in shopping functionalities
- Engaging with viewers through comments and interactions
The competitive landscape of short-video commerce continues to evolve, with success likely favoring platforms and sellers that can best understand consumer needs while delivering compelling content and frictionless shopping experiences.