Twitter Has Plans to Revolutionize Commerce and Here's How

NEW YORK ( TheStreet) -- Twitter ( TWTR) , which has become a place to catch up on breaking news and a destination to find restaurant reviews in real-time, is now looking to become a global, virtual shopping mall between the retailer and the consumer. 

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Earlier this month, Twitter took the wraps off its "buy now" button, with 25 commerce-oriented early adopters, such as Burberry and Home Depot ( HD) ,  signing on. The consumer clicks on a "buy now" icon in tweets, pulling up a landing page where he can type in shipping and payment information to make a transaction.

But the buy now button is only the first step in Twitter's emerging mission to connect merchandise sellers with huge ad budgets to buyers. In an interview with TheStreet, Twitter's director of retail, J.J. Hirschle, a former Google (GOOG) executive that oversaw sales and partnership efforts for Google's retail clients, gave a glimpse into the company's commerce initiatives. Hirschle also foreshadowed what the future of commerce may look like in a universe of wearable devices and touch-screen smart TVs.

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Brian Sozzi: How are Twitter's retail partners seeking to tap into the power of the buy now button on Twitter?

Hirschle: I think the most exciting thing about buy now is this notion that retailers could start connecting with consumers in this kind of serendipitous moment, or impulse moment. Imagine the day when a retailer would be able to connect with a consumer in multiple moments. One moment might be that consumer watching an NFL game and tweeting about the game. A vendor could then tweet a buy now button with the jersey of the team that they are watching. It's this notion of connecting in a highly relevant moment for the consumer and removing friction from the buying process.
Sozzi: Retailers arguably still have not tapped into the full potential of Twitter. For example, where are the unique video and Vine releases for new products? What is the roadblock here?

Hirschle: With any product it's fair to say there are going to be challenges around integration and adoption. I spent nine years at Google, and I look at how long it took for some of those retail clients to understand the product. It's just a learning curve more than anything else.

If you look at Vine, there have been some examples, such as Lowe's (LOW) which had tips (watch Vine here), using Vine as a platform to share tips around specific common do-it-yourself type home-improvement projects. Target (TGT) (watch Vine here) and Victoria's Secret have been on it, and using it. The other thing to keep in mind is that Vine is 18 months old; for its life cycle we have seen decent adoption. But it's a powerful tool for retailers to tell vignette stories inside of their store.

We separate Vine from video, and have a separate native video player, which is a new play for us as well. Nike (NKE) had a ton of success during World Cup leveraging their brand strategy via our native video player. In retail, video tends to lead to higher conversion rates overall. My sense is that Vine and video are going to be much bigger focus areas for our partners moving forward.

So for many of our clients, both in retail and outside of retail, there is a long history of highly produced content, and we have to get them comfortable with the fact that users are OK with content that might not be as highly produced because it has a more authentic feel to it. That's a leap of faith for some folks. It's getting them comfortable with a production value that is different than in the past.

Sozzi: Many retailers continue to not approach investing in social media teams in the same manner they would a new store or other infrastructure investments. Are you seeing that? 

Hirschle: When you say social media teams that could mean so many different areas of a retailer from customer service to communications to marketing. I think what you are seeing is particularly reflective of retailers just starting to staff their customer service element around social in a much more meaningful way.

It's critically important to think how you are leveraging insights from a data standpoint in store not only to influence marketing and customer service, but how could that potentially be a signal to use to inform pricing decisions or inventory decisions or help them rethink store layouts. There is an abundant amount of data that lives in the platform that simply, I think retailers haven't started to apply in all of the relevant areas.

Sozzi: How do you think Apple's  (AAPL)  new watch and payment system will change commerce on Twitter in 2015 and beyond? 

Hirschle: When I think of Apple Watch I think of it as another screen that will force us to get even smarter on how we understand this extra screen behavior of our users, and how each of those different steps are influencing their behavior overall. The reality is that it makes things even more complicated than they are today because we are already dealing with a world where there is your TV, tablet, computer, and cellphone, and now to correctly measure the impact of all these screens is tough.

It's probably early to say how Apple Watch will change how we engage with our users.

Sozzi: Retailers love to put Twitter hashtags on the bottom of their TV ads, almost like an afterthought. What is coming down the pike that will better integrate traditional TV ads and commerce? 

Hirschle: The use of hashtags has become commonplace from a broadcast standpoint. I think the real opportunity that comes to bare is with our ability to use our TV ad targeting products to connect with users that have actually seen that ad and have engaged with that hashtag, and extend the conversation or story that the retailer started on television. This is done by either giving them an offer to drive them into the store, or trying to get them to provide feedback on a different product. Or, ultimately, potentially even having them buy a product.

Sozzi: In walking the aisles of retailers, one thing is abundantly clear: The aisles are dead, devoid of dynamic Twitter real-time conversations. How is Twitter seeking to bring its real-time nature to, say, a box of General Mills (GIS) cereal or piece of Nike apparel sitting in the aisle?

This notion of Twitter being this bridge between a more tactical store experience and the digital world is huge. A lot of it is going to be driven by promotions in the aisle by category, by product in partnership between vendor and manufacturer to start the conversation. Best Buy  (BBY) did something called tech trending last holiday season, where they showcased all of the type of products trending on Twitter and they displayed that on displays in the store to get the conversation going with the consumer. And, I think, they did this to build urgency around buying in the store and combat showrooming to a certain degree. The ability to connect with the consumer and extend the aisle not only from a conversation standpoint, but from a merchandising standpoint, is huge.

Sozzi: How are retailers planning to use Twitter differently during holiday season 2014 compared to holiday seasons in recent past?

I think our platform is in a very different place than it was 12 months ago. There are three areas, from a targeting standpoint, from a creative standpoint, from a measurement standpoint. We have a lot more tools that will allow retailers to connect with a much more relevant audience. We have seen retailers thinking about who are the right users to connect with, and how do they put the right creative message in front of them. Also, how is it more engaging, be it video or different strategies that will pull customers into the store.

We are in a different place in understanding how using promoted tweets influences behavior on the platform, but also behavior in the store, behavior that takes place on a retailer's Web site.

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At the time of publication, the author held no positions in any of the stocks mentioned.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

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