Contextual Commerce, Part 1: Taking Contextual Marketing to the Next Level

Contextual marketing and ecommerce are coming together in what’s known in the industry as contextual commerce. Aside from being what PYMNTS.com considers one of The Six Things That Will Define Payments In 2016, it’s part of the evolution of the Internet of Things, which connects people to the tangible items in their lives through smart technology. It also fits right in with the “on-demand” mentality of today’s consumers, whose online shopping behaviors are being shaped—in real-time—by new technical functionalities.

Putting Contextual Commerce In Context

In an article on Venturebeat.com, Braintree defines contextual commerce as using data from devices, apps, and websites to provide customers with the ability to make purchases and payments wherever they happen to be online, not just on a merchant’s website. But what we think of today as contextual commerce isn’t necessarily what it was yesterday or what it will be tomorrow. It comes from and leads to a number of things, leaving the definition of “contextual commerce,” at least at the moment, somewhat abstract.

Here are two examples of contextual commerce in action:

• Fitness Tracker “Buys” Sports Drinks—A person who drinks one sports drink after each workout programs their fitness tracker to order a fresh case of the product to be delivered to their home after they complete 12 workouts. (From ClickZ.com)

• Recipe Website Prompts Purchase of Key Ingredient—A person following a pulled pork recipe on a cooking website is given the opportunity (via a call to action button or link) to purchase the specific BBQ sauce recommended by the recipe author. (From PYMNTS.com)

Stepping Beyond Contextual Marketing

Contextual commerce has its roots in contextual marketing, wherein marketers first served up banner ads and pop-ups on websites to encourage click-throughs to shopping sites. Less intrusive, more data-driven tactics have largely replaced these earlier methods; today, website visitor demographics, site analytics, and more sophisticated cues from the customer him/herself trigger ads that are highly relevant and timely.

As mobile commerce picks up speed, a similar form of marketing is used to connect with people via their mobile devices, employing text messages or clickable ads to motivate consumers to shop. And in the realm of social media, consumers are delivered highly targeted ads and presented with “Buy Now” buttons and the like—all designed to facilitate a sale. (Social Commerce: Mobile Shopping Made Easy talks specifically about this phenomena in social media.) The purchase prompt and integrated functionality, including payments, is what takes contextual marketing to contextual commerce.

Heading Toward the Informed Impulse Purchase

It’s fair to say is that contextual commerce is changing the way people engage with their favorite brands; it’s where consumer preferences and technology meet commercial opportunity, and its potential seems to be limitless. An upcoming post, Contextual Commerce, Part 2: Shopping For Tomorrow’s Consumer, will explore how contextual commerce is poised to support the consumer’s entire buying cycle and where payments technology fits in to enable a seamless purchase transaction.