What Will Make Shoppable Ads Successful

In a world of constantly evolving ad formats and strategies to tempt consumers into buying, it was inevitable that technology would come for the lowly advertisement. No longer consigned to splashy two page spreads inside fashion magazines, ads can now be a vibrant, active part of any merchant’s go-to-market strategy by capturing consumers’ buying intent right within the ad.

And capturing a sale without extracting the customer from whatever they’re doing at the time eliminates key elements of friction that stand between the merchant and revenue, so long as they’re ready to take advantage of the opportunity.

What is a shoppable ad? 

Unlike so many impenetrable tech buzzwords, the answer really is in the name: shoppable ads are ads that the viewer can shop through without context-switching away from whatever they’re doing. Notable shoppable ad examples include:

• Instagram shoppable ads, where users can tap the ‘Shop Now’ button on ads and interact directly with the merchant without ever leaving the app.
• Inline e-marketplace ads: merchants like Amazon include what are effectively ads in their search results, promoting paid offerings to the top of the list, and providing Add to Cart buttons that can be used without having to enter another screen
• Placements with QR codes: whether on a billboard, flashing up on a bus stop screen, or running on television, ads increasingly include QR codes, which customers can use to shop from their phones without having to interrupt what they’re doing.
• Streaming TV ads: increasingly, streaming services like YouTube TV and Prime Video include both QR codes and clickable links within ads so that customers can rapidly shop for the promoted product.

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Why Merchants Care About Shoppable Ads 

Any obstacle between a consumer deciding to buy something and them actually doing so is commonly known as friction. The more friction, the lower the likelihood of a sale.

In the early days of the Internet, ads might include an actual URL that they would expect the user to type into their browser. When this proved susceptible to all sorts of challenges, not least of which was fat-finger typing! A cottage industry of ‘vanity URL’ generators arose, allowing advertisers to offer easy-to-type destinations. Even that was too much, so ads evolved to deliver customers to precise destinations when they were clicked, with attribution and other tracking information preserved and delivered to analytics systems.

But even when the passage from view to shop was simplified, it remained jarring: generally speaking, shoppers who clicked on ads had actually been doing something else at the time (reading the news, say, or catching up sports scores), so being transported to another tab to shop was an often unwelcome interruption, leading to dissatisfaction and low success rates.

Thus the introduction of shoppable ads. Advertisers have seen extraordinary results, leading to up to 25% better outcomes than with traditional display options. Advertisers placing shoppable ads on popular social media networks like YouTube, Instagram, Facebook, and Pinterest are tapping into a market where as many as 70% of users reliably make purchases and are less likely to experience the deal-squelching impact of context switching because they stay within the familiar app.

The market for shoppable ads is massive: estimates place the US shoppable ad market at over $80B in 2026. Shopping, in the heat of the moment, based on the ads displayed by social and media networks, has become a standard shopping motion for most consumers, with most people shopping online.

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Challenges to Launch Shoppable Ads 

When diving into the world of shoppable ads, merchants need to ensure their transaction systems are ready. This can include everything from setting up their purchase interfaces to be responsive (i.e., equally easy to use on a smartphone as they would be on a computer), to building the payment process to reduce friction. For most, this will mean:

• Offering the payment methods shoppable ad users prefer: if the whole point is to reduce the disruption to what the shopper is doing, it’s unacceptable to ask them to laboriously type in their credit card number! Merchants need to be able to accept digital wallets payments, alternative payment methods, and more.
• Ensuring minimal manual data entry for repeat customers: customers should be able to identify themselves easily and have their stored payment information instantly available. 
• Protecting customer data: as easily as customers should be able to access their stored PII and payment data, the login should be as secure as possible, and deliver the lowest possible risk of data leakage or identity theft.
• Ensure availability: it’s one thing to get the customer to the point of trying to buy, it’s another entirely if the payment system is unavailable. That sale that was about to happen smoothly and without friction fails, and the chances of reclaiming it (or any future business) are slim.

For merchants using a single, full-service PSP, some of these may be tricky, as that single partner is in full control of which payment methods may be available, currency conversion processes, and uptime. This is why so many merchants are opting to move to a multi-processor payments system, which hardens their privacy protections, offers options to avoid sending transactions to unavailable downstream payment providers, and enables strong opportunities to protect PII while making it simple for customers to access.

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What Shoppable Ads Need to Be Successful 

Those merchants moving to multi-processor systems are taking on a lot: taking over the responsibility of collecting and storing customer data, including credit card numbers and account details, can be a heavy and resource-intensive proposition. For this reason, many merchants are turning to programmable payment vaults to lighten the load and act as the backbone of their next-generation payment systems.

A programmable payments vault collects and stores customer information and provides a token to the merchant that can be used to initiate payment requests with any payment processor or gateway worldwide.

The token cannot be reverse-engineered to obtain the customer’s information, making it both secure and an effective way to reduce PCI-DSS scope and costs for the merchant. It can provide access to all kinds of information, from credit card numbers to addresses to customer-selected preferences, empowering merchants to build shoppable ad buying processes that are perfectly tuned to their environment.

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