Silicon Insights: T-Commerce a New Killer App?

ByTim Bajarin

May 17, 2002 -- Ever heard of T-commerce?

By now you are probably familiar with E-commerce or buying products over the Internet. And perhaps you have even heard of M-commerce, which stands for mobile commerce and focuses on buying products via a cell phone or wireless PDA.

But if you don't know about T-commerce, you will soon — that's because it is being touted as a potential killer app for interactive TV. The idea is to let users buy products over the Internet but through their interactive television, instead of over a phone or through a PC or PDA.

Many big advertisers are jazzed about the long-term potential of selling products directly to viewers as part of the interactive TV experience, launching T-commerce ads in homes where interactive TVs are in use.

Granted, that audience is very small now, but research firm The Gartner Group predicts that T-commerce will generate more then $13 billion in sales by 2005, up from $107 million in 2001. While those numbers might seem a bit optimistic, the unique twist to this commerce model has television executives are drooling.

Play and Pay

For example, have you ever been watching a TV show and seen a piece of clothing one of the stars was wearing and said to yourself, "What a cool blouse or shirt. I would love to have one like that." Well, according to a report in Emmy magazine by T-commerce watcher Phillip Swann, in the spring of 2001, NBC's Will and Grace invited viewers to visit at the end of the show and buy a $52 T-shirt like the one worn by actress Debra Messing in that episode.

Within 18 hours, 3,000 people had gone online and purchased the shirt, reported Swann. If you do the math, you see that they sold $156,000 worth of T-shirts in less than a day. NBC officials cautioned in the Emmy report that in this particular case the audience was told the profits would go to charity.

But as a result of this test, TV executives have been asking themselves how many more would have been sold if all the person watching the show had to do was click a button on their interactive TV, and through a T-commerce account already set up, buy the shirt instantly when offered the chance?

And what if you saw a specially designed iMac featured in a specific program, such as CBS's hit show, CSI, and decided you would like one for yourself. I bet Apple would love to sell you an iMac via an end-of-show T-commerce promotion if they had the chance.

Tie-ins as Old as Time

Another idea being tossed around is the ability to add an auction component to the T-commerce model and tie it to the actual shirt an actor wears in a sitcom and signed by the show's star. Or perhaps auction off a ball, bat or even golf club used by a sports star in a real match.

There is actually precedence for this kind of television commerce tie in. Since the beginning of the medium, people have been influenced by the style of the stars clothes and hairdos, as well as by the ads. As a kid, I just had to have a Davey Crocket coonskin cap. And when Friends became a hit, one of my staff just had to have a Jennifer Aniston hairdo.

It may take a while to flesh out the right business model and product links for T-commerce, as well as establish a real interactive TV marketplace. But add the T-commerce experience to an interactive TV, and a whole new dimension to marketing and selling products via television could be born, turning the medium into a next-generation high-tech marketing machine.

Tim Bajarin is a consultant and leading computer industry analyst and futurist, covering the field of personal computers and consumer technology. He's based in Campbell, Calif.