If you’re an e-commerce business owner, you know that data is crucial for understanding your customers and making strategic decisions. But what about creativity?
Special guest Chloe Thomas is a best-selling Author, International Speaker, and host of both the Award-winning eCommerce MasterPlan Podcast (https://ecommercemasterplan.com/podcast) and the Keep Optimising Podcast. She covers a wide range of topics related to ecommerce, including marketing, sales, customer service, technology, and more through expert guest conversation.
In this episode, we explore going back to basics in e-commerce. We also touch on integrated thinking, balancing data and creativity, overstock and inventory management, and video commerce. With changing privacy laws, relying solely on algorithms is no longer effective. Chloe suggests that businesses need to focus on creating compelling content to cut through the noise and competition. She notes that the industry is currently “shockingly bad” at creating videos and suggests that brands should focus on creating for different purposes, such as product explanations, company values, customer demos, and reviews. Balancing data and creativity can help you create compelling content that resonates with your customers and sets you apart from the competition. Chloe also discusses the current economic environment and the importance of sustainability in e-commerce.
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Improving Margins, Profits, And Marketing Results With Chloe Thomas
Today is another day when Whitney won’t be with me. We had a special guest coming all the way from the UK, and because of time change, time zone, and all that, we had to accommodate. We’re super excited to have Chloe. Before we go there, here is a quick update on eStreamly. We are excited about the last update that we’ve made, where we are enabling all users if they want to embed the portrait or landscape mode on their shoppable video in email. This is a feature that many of you have asked before. We are excited to have released that. Let’s stop talking about eStreamly. Let’s start diving into the super topic now. In this episode, we have Chloe Thomas.
She’s a bestselling author, international speaker, and host of the award-winning eCommerce MasterPlan Podcast, which is an awesome podcast. If you haven’t checked it out, feel free to check it out and the Keep Optimising Podcast, which is also a good podcast. Let’s be honest. Chloe is one of the Top 30 eCommerce Influencers in 2021. Podcasts are regularly included in the list of the world’s top eCommerce and marketing podcasts.
Their podcasts are focused on providing insight and strategy for eCommerce businesses. She covers a wide range of topics right to eCommerce, such as marketing, sales, customer service, technology, and more, through an expert guest conversation. She brings on a lot of cool guests. If you’re looking at your eCommerce journey, It’s something that you want to get more grasp on the topic of thinking through your master plan and all that. This is definitely a place where you want to start. How are you, Chloe, doing?
I am good, Nicolas. Thank you so much for inviting me on and for doing the jiggery-pokery with the time zone so we can make this happen. It’s brilliant to be here.
The time zone is always something. This is definitely something that I’m sure everyone has experienced or is experiencing as we speak about the pandemic. More teams are decentralized, and we realize that not everything happens from 8:00 to 5:00 anymore, so we have to figure this out. This is one of the things that the time zone is definitely great about. I look at your career and what you’ve done before. You started in banking, and then you had a retail experience in the catalog mail business. I always think this is interesting. I’d love to start from that point and say, “What were the key learnings for you, and how are they applicable to the way we do commerce now?“
That’s a super interesting question because, with everything I see going on in the eCommerce space at the moment, we’re at a point in time where we need to go back to being better marketers. That comes back around to all those basics or key strategic pieces that I learned at the beginning of my career when I was taking marketing exams, learning how the catalog of mail order industry works, the focus of the targeting, but the right messaging, the right offers, endless amounts of time trying to construct the right offers, the graphics, and the copywriting. There have been Facebook ads over the last few years. You end up in that situation where everyone gets a bit lazy. Now, we can’t afford to be lazy anymore. There’s a huge amount that I take from my first job in eCommerce that’s so relevant, still nearly 20 years on.We're at a point in time where we need to go back to being better marketers. Click To Tweet
If you think about video commerce, people are saying, “This is so new and everything.” No, it’s not new. It was invented by QVC many years ago in some way. It’s going back to the basic. I love this notion of, “You are thinking about taking this experience, marketing experience, and reapplying some of those tools and strategy.” I wonder if that’s the genesis of the Customer MasterPlan? Did that inform you about creating the Customer MasterPlan? I’m sure there are plenty of people in this part that haven’t listened. I encourage you to do that. How do you define that? How would you explain it to my six-year-old?
I’m not yet trying to explain it to a six-year-old. For starters, I should apologize to your audience because I have an impressively bad track run of naming businesses. Mine are quite complicated and confusing. My business is called eCommerce Master Plan, which lots of people still think is mastermind, masterclass, or something else. It’s my bad. I’m bad at naming businesses. I also created a plan called the Customer Master Plan and then a podcast called the eCommerce Master Plan. Even I get confused.
To try to answer your question and make sense of it for the audience, there is the eCommerce Master Plan Podcast, which has been going since 2015. Each week, I get to chat with a cool eCommerce business. It could be tiny or huge. We talk about how they’re growing their business, succeeding, and even more about the sustainability elements of their business. Over the years, I have taken those conversations with people across the industry, my understanding of marketing, my grounding in marketing, and what I see at events. Everything I learn gets fed into my brain, and then I try and turn it into models to help eCommerce businesses grow and thrive.
Back in 2012, that was when I wrote the original book, eCommerce MasterPlan, which is about understanding the building blocks of eCommerce. A few years ago, that evolved into what was the Customer MasterPlan Model, which is about understanding that there are different stages in the buying journey and approaching it. Rather than going, “I need to do email,” going, “I need to turn more people on my email list into buyers. How do I do that? I need to turn more first-time buyers into repeat buyers. How do I do that? Is it email? Is it video? Is it Facebook Ads? Is it Google Ads? What might it be?” It’s to try and encourage that change of happening.
At the moment, I’m working on a new model called the Traffic that BUYS Model, which takes it to another level. The customer MasterPlan piece is about trying to get marketers. This is important when I wrote the book, Customer Persuasion. It is even more important now as we go through all these changes. It’s about getting people to think. I’m sure you must come across this a lot, Nicolas. It’s not getting people to think we need video, live video, or whatever. It gets them to think, “This is the problem. This is what our customers want from us. How do we deliver that well?” To get people brands to think that way because then they set themselves up for success rather than going, “Ooh, video,” or “Ooh, email,” or whatever else it might be.
I love that idea. It’s something that resonates with me is when you say that you went through the podcast and interviewed all those businesses, small and bigger size. For me, I feel that I have learned so much from talking with other folks about how they approach video commerce, eCommerce, and their email marketing strategy.
There is so much knowledge and insight that you can get from having a conversation. In some way, the podcast has been an MBA in some way. I can totally translate and emphasize what you went through. I commend the idea of now you have this knowledge and you’re trying to transpose it into a book or, in your case, multiple books because there’s a lot of value.
As a brand owner, you do have things that your next colleague that may be sitting next to you on the eComm has no idea that you know how to do it. Having this opportunity to be able to surface some of your best practices, what you’ve been working, and what has not been working with others is something that can leverage the whole ecosystem. A podcast is a great tool for doing that. Community, as well, is another great tool.
It completely fits with one of the big things that brands are going to need to start doing over the next twelve months, certainly over the next decade. It is to bring those skillsets within the company together. For the last decade, if not the last two decades, people in marketing have been talking about, “Don’t have silos. Get your agencies to talk to each other. Get your team to talk to each other.” I spent quite a lot of time trying to work out. If I was looking back in two years’ time, what are the businesses that have done the best over that time span in order to be the best and trying to predict what the key things to do will be? One of the big ones at the moment is integrated thinking around the business. As I said earlier, we’ve got to work harder and be less lazy. Most of the answers are within our business.
We’ve got the data from customer behavior, marketing results, what they’re returning, and our inventory systems. We’ve got so much data in the business and in the heads of our teams. If we can bring that data together, we can bring the people together to work more closely. The margins get better, the profit gets better, and the marketing response gets better because we know what messages to use. We better understand how to target it and what to do. That piece you were saying about trying to work more closely together is so on the money for what people should be investing in right now.
I could see, as a business owner myself, the counterargument to that, which is, “I have all that data, but what do I do with it?” It’s so hard to be able to understand it, distill it, and make sure, at first, all the data say the same thing because it’s saying all those different platforms you need to. It’s finding a way to first aggregate, clean that data, and then be able to make it work for you. Also, we can have the pat on the back, “I love that data. That’s the story I want to know and push a prompt.” The reality is that you have a backlog of data that says, “No. That’s bad behavior.”
It’s interesting to also challenge yourself on what you see in that data. Not to embrace what you want to see, but be critical about what that data is itself. This whole data thing, obviously, was not where the conversation was supposed to be, but it’s a fascinating topic from your perspective. For many of those brands and entrepreneurs, it’s definitely something I’m assuming you’re bringing upfront quite often. Is that something that you’re bringing to the MasterPlan? Is it something you are working on?
We don’t get deep into the data side of it in the model. One of the interesting things about the data or about where the industry is going at the moment is we need this data, understand it, and make sure the right information is going in at the bottom. All the systems are in the same currency. I’ve seen many brands have one thing feeding in dollars and another one feeding in pounds. That’s not good if you’re trying to compare results.
You’ve got to do a bit of data hygiene. You’ve got to have people who can read and interpret the data without that biased look. You need those kinds of 1s and 0s brain people. At the same time, we need to focus ever more on the creative side of things. We’ve got to lift the bar on that because consumers want it and things are more noisy. There’s more competition. We’ve got to start cutting through.We need to focus ever more on the creative side of things because things are noisier. There's more competition. We need to start cutting through. Click To Tweet
Also, because privacy laws are changing, we can’t rely on algorithms to make our lives easy anymore. We’ve got to put that effort into the creative, whether it’s video, text, graphics, or whatever it might be. That is not the 1s and 0s brains because we’ve been so focused on the targeting, particularly on the Google Ads and the Facebook Ads platforms.
A lot of our performance marketing people are very data-focused. They’re very 1s and 0s and we’ve got a bit of a mismatch. There’s a bit of an alteration of teams coming up in our future as well, which may be one of the reasons why I think the industry hasn’t been quite so good at grasping video as it should have been.
I love that you are saying that. There are a lot of things that I want to react to this notion of, “We need to bring creative up.” One of the purposes of this show is that we are moving away from a shopping perspective to a content-based behavior, where I see a piece of content, get excited about it, want to know more about the product, and then end up shopping. More importantly, if I’m a brand owner and this is something that is hammering, I won’t say constantly, but on a regular basis, that it’s nice to create content, but creating content is expensive. It is really expensive and such a shot in the dark if you don’t know how to do that.
From your perspective, you’ve talked to a lot of entrepreneurs and brands. The reason why people are focusing so much on the data is because this is more predictable than focusing on the creative. If I were to be a brand or an entrepreneur coming to you and say, “Coming with this argument, how would you counter interact that argument? How would you lead me to embrace content in a way that works for me as opposed to thinking that how it’s going to be an overburden?”
Whether you are a 1s and 0s person or a true creative brain, you have to start from a data perspective with your creative activity. There is coming up with an idea. You could go, “We’ll do this. This will be amazing.” The customers always have the answer. You’ve got to start asking the customers whether you’re doing phone calls with them to find out what words they’re using when they’re talking about your product. Also, why they love your product, why they pick it over someone else, and whether you’re using their behaviors to help you work out what creative to make.
What you make and what messages you put in it all come from the data. You then need that creative brain to go, “Let’s try and make this interesting, compelling, take that data, and turn it into something which delivers, which is not necessarily crazy high production values.” It’s about the message. It’s not about it looking like a Hollywood perfume ad or something. You need that data piece again, coming back in to help you optimize the creative.
One of the other mistakes people make, especially with video, because it’s a bit more complicated to create, is they go, “We’ve done a video. That’s it for the next three years. We’ve ticked the video box. We can ignore it.” No. If we use the ad space, you’ve got the text that’s around the video, the first image, the length of the video, and what order you put the messages in.
To do the optimization process, you’ve got to start seeing your creative, whether it’s video, graphics, or something else. Break it down into the constituent parts, and then you can start doing you’re A/B testing the same as you would’ve done previously. You can take that historic skillset of the 1s and 0s and bring it into play, but you need someone with a bit of creative vision and comfortable with those creative elements to realize the creative you need to be putting out there.
We’ve talked in this show s that if you are not one of those creative, that’s where a creator or working with influencers can be interesting. If the audience may recall, we had one of our guests, John Roman, who is not creative. He loves watching TikTok and YouTube videos. Who doesn’t? For him, he has his business. His business was growing well, and then he started to sample some of his customers. He realized that one of their paying clients was producing content about their product on YouTube. That content was very exciting. People loved it and reacted to it. I’ll invite the audience to tune in to the full story. Basically, he ends up, at some point, hiring that client and making it in-house. That person becomes the creator.
Sometimes the creative doesn’t have to be in-house. It can be someone that you build a relationship with that have a particular affinity with your audience and know how to communicate with your audience. At the end of the day, the whole magic of the creative is about how you transpose your ideas. As you say, your strategy to your audience is they are comfortable with it, love it, and embrace your product. There is another thing that you are working on right now. You’ve done some good work around it. It’s around overstock and you are exploring a lot of overstock. This is a big topic in eComm right now. This one is huge. Although, I will say, it was even bigger soon.
It’s slowly getting smaller.
What’s your take on that topic? What’s the free recommendation to clear out the warehouses?
The interesting thing is I had this idea for a different type of virtual summit back in late 2022. I was going to do it on the returns problem because I wanted to tackle something that sits in the backend. Someone said, “You should probably do an overstock.” I went, “We’re going to have a look at that then.” January came and I went, “I should be doing this on overstocks.” That was accidental. I thought, with my sustainability and my bigger picture hat on, I was like, “Let’s do the event.” We go right away from how to clear out your current nightmare overstock. An overstock means you’ve got stock you don’t want to have sitting in your warehouse. You bought too much. The customers didn’t buy it. What do we do with it because it’s cash sitting there that you can’t do anything with?
I want to take it right from that point through to, “How do we avoid overstocks in the future?” Some of the big trends that came out of that discussion are a whole series of sessions primarily talking about inventory, not marketing, exciting videos, or great creative. The big trends that came out of that were working together in the data. Also, the fact that what we need to do. This inventory data has the potential to be the make or break for businesses over the next few years. If you can find a way of bringing your inventory and your returns and that data into your marketing activity and get your buyers, merchandise, and marketers working on creative together, you’ve got huge potential.
I learned a lot doing that series. It’s been fascinating. For anyone who wants some access, it’s still available for the price of an email signup. It’s very easy to get your hands on. It’s fascinating and big trends are coming out of it. For anyone who’s still got stock, and I’m sure there are plenty of you out there, sitting in the warehouse, you want to clear from 2022. There are 1,000,001 ways you can clear it from the people who are set up to help you clear this distressed stock, like auction houses, secret sales websites, secret physical sales organizers, and shipping it on eBay. There are companies out there specializing in shipping specific product sets on eBay for you and a whole variety of other things. Through two ways, you can do it via your own website.
The key things to consider are time and money in terms of how quickly you need to clear it and how much margin you are willing to give away to clear it. Those two, they’re a bit like a seesaw. It depends on how much cash you need to get back into the business. There are a lot of hard decisions to make. The chances are you’re probably not going to want to ship all that stock via just one of those methods. Probably, there are going to be some other ways to do it.
If you get into the data, then you should be able to find some good answers. If you’re running influencer marketing campaigns, look back over the last 6 to 12 months. Was there one of those products you’ve got too much stock of that one of your influencers did a great job of clearing? Let’s go back and talk to the influencer about a great multi-buy deal because you’re trying to clear a load of stock, not just a discount. Run it with them. Make the influencer and their audience happy. Clear it via your own channels, probably for more margin than you might otherwise do. Make it seem special, not like a problem.
Another super clever way I came across was an app called Nibble, which is an AI negotiation chatbot. It can have conversations with your customers on your website about getting a discount on your product or does it all for you and sorts it out through the sales. They have shown several times now with brands I’ve been working with that they can save you more margin than if you did a big old percentage discount. That’s worth trying out, but of course, that’s limited by how much traffic you can drive to your website.
We’ve now reached April. If you still got Christmas stock lurking around, you managed to survive four months without that cash. You might be tempted to look at it and go, “Let’s make sure it’s not in a wet, damp corner of the warehouse, and maybe we’ll hold onto that for this Christmas.” It’s time to stop worrying about what’s sat in the warehouse and start looking at how you can run everything else more efficiently.
We probably could have done a whole year on the topic, but you’ve got to draw the line somewhere. It’s about being a bit creative, taking a breath, thinking through, and getting to grips with what you’ve got, how much you can afford to sell it with, and what channels you can use it by. The one other thing I want to say on it is to factor in the opportunity cost of going on about it week after week in your own marketing. If you’re still trying to ship your Christmas stock via your email newsletter, please stop. Please start talking about your new stock because your customers are as bored of it as you are, and you are wasting marketing space talking about the wrong things. That turned into a bit of a rant there, Nicolas.
It’s such a big topic. As you say, we could talk about it in an hour but we’re talking about it for two minutes. There is so much to say. One of the things that resonated with me as well as I remember in my previous experience, was that we had some leftover inventory from Christmas. Mid of the year, we sell. It’s like, “Let’s stop doing any action and we’ll keep it for next year.” It ended up that next year, that stock was less than it was before.
Caring for that inventory and hoping for the future is not always a good thing. Think about that as well because you don’t know what tomorrow is going to bring. You don’t know if your warehouse is going to be wet, as you say, or if you have going to be something going on. It’s always better to clean up your inventory and not hopeful. Embrace for the future because that could be a problem.
I love all the other thinking, especially on the email. If you keep trying to sell your inventory from December to April, you are probably bothering your audience. I do love the idea of going after different channels that are known as Jensen to your current channel to offload that because, in some way, you are tapping into other audiences. You know your return is going to be lower, but at least your primary audience and target, which have paid the prime price for your product, is not bombarded by, “I have this left. I’m willing to do 50%, 60%, or 70% on it.”
It’s an awesome topic. Before we wrap up, I’d love to take a thought from you or two folds. This show is all about video commerce. We’ve talked about it through time during this show. What is your take when you think about video commerce? Do you think brands are leveraging it? Are they doing enough with video and video shopping in general? Do you think they’re doing too much? If you had to pulse a little bit with what you’re seeing, would you increase that pulse, or will you decrease it? I’d love to have a tune on that.
The industry is shockingly bad at video content at the moment. It’s one of those things which I keep thinking, “The brands are finally going to get to grips with it,” but it keeps on not happening. I try to work out what these reasons are. Obviously, there’s the, “It’s video. This is a nightmare to create,” elements that come into it. I think people get hung up on video via one channel. They might be doing some TikTok or Instagram Reels, but it hasn’t occurred to them to move it onto other channels, or they create dull catwalk videos of someone walking up and down, which have their place in the sales funnel but are not that interesting. If you’re not doing something else with them, you can’t leverage it across other channels.
Also, a lot of brands get hung up on, “We need to create one master brand video to play on the homepage.” You’re like, “Please.” There’s all this confusion about what to do and what to create. Brands get stuck on it. If they’ve got one person, maybe the ads team, get good at it or the social team get good at it, but there’s not that cross-pollination of ideas and skills happening throughout the business to sort it out, and then they get hung up on that, “It’s got to be movie quality.” You’re like, “No. It doesn’t.” I see one of my roles is trying to help people get past those blockades and get them to take advantage of the channels we know work. Fundamentally, we know this works. If you create it half well, it’s going to improve your sales.
I try and give them ideas of the quick ways of doing it. I spend a lot of time talking about UGC or getting influencers to create the content. Running influencer campaigns as much to create content as it is to create sales. I’m trying to give them ideas of how to do a version of video marketing well. It’s a bit too overwhelming for people. I have great hopes that with all the pressures we’re seeing in the industry and all the pull factors we’re seeing, we will see more brands doing video well, but I’m not holding my breath, nor am I betting on it.
I love what you say because it made me think that it’s true that in the show and me, the first one, we’ve been talking a lot about doing video livestream and all that. It’s true that when you think from a video strategy perspective, there are several dimensions. You have the video for the product that is the video that they explain. You have the video about who the company is, what’s their core value, and why they’re doing what they’re doing. You have the video about helping the customer from their perspective of the demo or product and how to use the benefit, the key feature, and all that. You may have the video of the review. That’s where the UGC may come in.
What I love about what you’re saying is that this is not something that we brought up. Before, we always are saying, “How do you leverage your overall video hierarchy?” You are saying, “Let’s forget about this whole thing. Pick one of the topics. Be very good at it. From there, once you’ll learn that, then it’s time to go into a Jensen’s thing.” I love that idea and I think it’s something that we definitely will continue exploring in this show. We’ll bring on folks who specialize in those topics and how they make it work. That is an interesting insight. I’d love to finish on hopefully a positive note.
At the time of this recording, we’re in April 2023. The economic environment is somewhat tense here in the US. The latest retail release was -1% for March year over year. I think it was just for March, not year over year, which is not great. Let’s be honest. You are talking to a lot of partner brands. In some way, we all live in our own bubbles because we have all the problems we must try to solve. We are trying to get everything under control. We have pressure from cost and everywhere. What message would you like to pass on to those people knowing what you know, having talked to so many different people, and being where you are? I’d love to hear you from there.
The economic situation is not the greatest around the whole world at the moment. I don’t think it’s as bad as anyone thought it was going to be. Everyone seems to be more positive. I don’t know if it’s because we moved into Q2 and everyone went, “We’re going to be positive in Q2.” I’m not sure, but it feels like the industry is picking up a little bit. We’re also going through quite a big rebalancing in the economy, especially in the retail, SaaS, and software spaces. Over the last five months, we’ve seen a lot of big software companies shedding staff. I’ve seen as many people posting that they’ve got twenty job roles on offer in the software space. As I’ve seen posts, they’ve laid twenty people off. We’re going through a big rebalancing on that.
This is more of a hope. I desire this. I may be trying to make it come true myself. I hope we’re seeing more of a rebalancing in the eCommerce brand space in consumer spending away from less necessary products towards more sustainable products. Maybe we’re seeing people moving from fast fashion to core classic pieces that they’ll keep for a longer time. I’m hoping we’re seeing that. The sustainability piece certainly seems to be accelerating. I was quite worried pre-Christmas that the consumer would move towards sustainable goods because the cost of living crisis was going to get squeezed out. It doesn’t seem to be happening. You talked about bubbles. Sustainable brands seem to be in their own special little bubble that seems to be relatively unaffected by this.
Now is the time to get your brand on the path to sustainability, listen to your customers, and see what words they’re using to describe their product. I’ve seen brands here in the UK that historically have talked about how great their products are for your skin, pivoting to go, “If you buy this product, then over the next three years, you’re going to save £500.” It’s the same product and price but different messaging in order to move with consumer interests. I would be looking strategically toward what we’re going to need to be doing and selling in five years’ time and starting to make those moves now. That’s maybe a positive way to end.
I love this notion of like, “The economic environment, it is what it is, but you need to keep thinking forward, and what is that forward looking?” I’m a big fan of everything organic, fair trade, and sustainable. Thinking through the lens of sustainability is something going to stand out. I was on live. Literally, the creator had different products to present, but the one resonating with the audience was the one where she said, “By the way, this sheet of lens cells is from this kind of cotton that is coming from this part of the world.” The whole narrative around it excited people more than, “Here’s a cream and it does X.”
Everyone has the best cream. How do you differentiate against that cream? What can you do that resonates with me? Especially if you are targeting a younger audience, Gen Z really resonates with that and even Millennials. I love the idea of getting more environmentally friendly. This has been a really cool conversation. We definitely went on off track. That’s why I love to have Whitney with me because she’s always good at keeping everyone on the toe and making sure that we keep track. It was a fascinating conversation that we had. I’d love for the people in the audience that want to understand more about you and see how you can support them. What is the best way to reach out to you?
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- eCommerce MasterPlan Podcast
- Keep Optimising Podcast
- eCommerce MasterPlan
- Customer Persuasion
- Chloe Thomas – LinkedIn
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