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PATENT DROP: Big Tech’s shopping spree
A breakdown of the new ways that tech firms are trying to sell you something.
Happy Tuesday and welcome to Patent Drop!
How we shop has changed dramatically in recent years. With that change, tech companies are continuously working on new innovations to keep up with the ways that consumers are buying. Today, we’re checking out tech from Block, Snap and Shopify that illustrate some of what lies ahead in the world of e-commerce.
Let us go forth.
#1. Block’s content creator stint
Block wants to help its merchants flaunt their assets (and sell them, too).
The company is looking to patent a platform for customizable e-commerce tags in “realtime multimedia content.” This tech uses computer vision and speech recognition techniques for multimedia analysis to detect when a product is in a video, and pull up an “e-commerce tag,” or a pop-up box that displays more information and allows purchases for that product.
For instance, if you’re scrolling through social media and see a brand talking about different items, Block’s system will pull up different pop-ups depending on an item. The merchant, meanwhile, doesn’t have to do much to benefit from this: Block’s system takes care of everything, as “interactive elements are generated and intelligently positioned without merchant intervention.”
This tech works whether or not a merchant gives an “explicit or implicit indication” that they’re aiming to sell anything in the live or pre-recorded video, Block noted. The company also said this system can “communicatively couple” with what it called “pure” social media platforms, specifically naming YouTube and Instagram.
Block said its tech aims to reduce the friction of a customer needing to go to a separate website or page to complete a purchase and “detracts from buyer engagement with the merchant, and could potentially lead to loss of sale opportunities for the merchant.”
Plus, Block noted, “while merchants may be adept at generating commercials and other forms of multimedia content, they may not be skilled in generating user interfaces, surfacing items that may be relevant to particular consumer of the content, and formatting displayable interactive elements that ease a customer's ability to purchase the referenced items.”
Block isn’t new to the creator market. In September 2021, the company, then-called Square, launched a new service in partnership with TikTok that made it easier for merchants to connect their online shops and sell products through the short-form video platform, as well as some interoperability with Instagram. By patenting tech like this, Block stands to strengthen its already strong position in social media commerce.
Despite the fact that influencer marketing has changed consumers’ purchasing decisions, e-commerce hasn’t been as flexible, according to Lauren Tierney, investor at venture and digital asset fund Decasonic. Major platforms like Block researching tech like this patent exemplify where the industry is headed, she noted.
“Most people buy from their social connections today. They don't buy from targeted marketing ads,” said Tierney. “I think that the future really lies in this idea that more immersive shopping will emerge … in the places we already consume.”
But point-of-sale is only a part of Block’s business. Along with Square, the company is the parent of Cash App and Afterpay, and generally focuses more on the financial services side of e-commerce than consumer-end innovations, Tierney noted. Researching tech like this could be a sign that it’s feeling pressure from rivals like Shopify and Stripe to upgrade its customer experiences.
Block’s tech also adds to the growing number of ways that AI is impacting the e-commerce, sales and advertising industries. Machine learning, computer vision and neural networks are being woven into everything from tracking user behaviors to creating and displaying digital ads wherever you shop online. And with CEO Jack Dorsey’s loud commitment to AI-enabled tech for merchants, there’s likely more to come from Block and its subsidiaries.
#2. Snap’s anywhere store
Snap has spent the past decade building AR tools for its platform. Now it’s looking to share the love.
The company is seeking to patent tech for creating what it calls a “customized personal store.” Snap’s patent details a method for businesses to provide a “AR/VR shopping experience” where users can interact with one another, as well as shop for virtual products.
Here’s how it works: When a user enters this experience, this system displays a VR representation of a real-world store, allowing the user to shop for products like they would in a brick-and-mortar business. If the user chooses to enter this experience with friends, it displays their virtual avatars, and pulls up a chat box to allow for conversation.
To try on or test out a product, the system utilizes AR rather than VR, allowing a user to see how something would look on them or in their actual environment instead of just the virtual store. Snap notes that this system takes into account the conditions of the user’s actual environment to avoid distortion issues that are common with AR shopping.
Snap said in its filing that this tech solves a host of issues with the current state of AR shopping, including presentation issues and the isolated nature of conventional AR shopping techniques. “(Users) can receive and provide real time feedback and improve the overall shopping experience,” Snap said. “This avoids missed shopping and purchase opportunities and increases the overall appeal of online shopping.”
It’s unsurprising that Snap is continuing to hone and refine its AR shopping technology. The company has long allowed its users to try on clothing, makeup and jewelry from different brands within the confines of its app. And in March, Snap announced plans to launch AR Enterprise Services, a new business unit focused entirely on helping retailers build augmented reality shopping experiences into their own platforms. The tech in this patent could reveal some of the tools that Snap has in store for its enterprise bet.
“Snap has actually led the way in AR and VR,” said Tierney. “Now, they're probably one of the most well-positioned to patent this and use this enterprise technology … for fashion brands and e-commerce brands.”
Many brands are antsy to incorporate AR experiences into their platforms for a major reason, said Tierney: the massive cost of returned products from online purchases. According to the National Retail Federation, consumers returned $212 billion worth of products from online purchases in 2022. Returns can also cost brands roughly 66% of the product’s original price. Allowing customers to at least somewhat see how a product looks in their home or on their person could minimize that rate of return, she said.
Even with brick-and-mortar shopping bouncing back from its historic pandemic lows, AR shopping has continued to grow in popularity among consumers, said Tierney. According to a 2022 survey from Snap and Ipsos, 79% of consumers reported that they were interested in AR shopping experiences. “I hate to say it, but the consumer is lazy,” said Tierney. “If you can try on something from home, then you’re going to.”
Let’s not forget that this could prove quite lucrative for Snap, as well. As the vast majority of its earnings come from digital advertising, which slumped in the company’s recent earnings report, extending its focus to enterprise capabilities could be a way to make up for slowing revenue growth.
#3. Shopify’s aesthetic guide
Shopify wants to save its merchants from having to shell out for a photographer.
The company is seeking to patent a system for “generating recommendations” during photo shoots of a product. Essentially, Shopify’s system pairs with the camera available on a user’s device (such as a smartphone or tablet camera) and provides guidance while the user is taking images of a product.
To break it down: The system first collects “baseline image features” of the product the user is trying to shoot, such as size or color, using an “image analysis algorithm” that examines one previously-taken photo of a product.
Then, this system provides real-time, in-viewfinder recommendations while the merchant is taking additional photos, such as angle fixes, lighting improvements or changes to the background. In one implementation, Shopify’s system deactivates the image capture button until its recommendations are taken by the user.
The company said its system prevents visual differences that stem from a number of issues, including aspect ratio, camera and product angles, depth, lighting and background clutter. This system ensures that a merchant’s photos meet a threshold of similarity set by the baseline image, Shopify noted, aiming to improve overall image consistency and save time on post-photoshoot editing.
“Products and/or photos may be related to one another and, as such, consistency amongst the photos is crucial,” Shopify said in its filing. “Any visual differences in the related photos may result in a poor experience for the customer and may lead to reduced brand appeal and/or sales.”
Good imagery is a vital part of online marketing and e-commerce, Tierney said. But over-edited photos of products often make buyers distrustful, she said, as more often people turn to customer reviews with non-professional photos to get a fuller picture of what they’re actually buying. Shopify’s patent seeks to avoid the pitfall of over-editing, as the company notes that “inconsistent photos may not be editable to achieve the desired consistency.”
While this patent seems like a tool for helping merchants with the fundamentals, Shopify’s long been interested in immersive customer experiences. The company has been experimenting with AR since 2018, and announced its commitment to the tech in a blog post in December. The company has sought to patent “multi-user augmented reality” that allows users to see an AR product from different perspectives.
“In terms of innovative e-commerce experiences, Shopify is leading the way,” said Tierney. “The company has been investing heavily in augmented reality and artificial intelligence, to create more immersive and personalized shopping experiences for its merchants and customers.”
However, Shopify has faced a considerable shakeup in recent months: The company cut 20% of its workforce in May, after having cut 10% last July. Though CEO Tobias Lütke didn’t specify which business units would be cut, the company also announced that it would offload its entire logistics unit to shipments company Flexport.
“The main quest of the company is its mission, the reason for the company to exist. Side quests are everything else. Side quests are always distracting because the company has to split focus,” Lütke said in Shopify’s announcement of the layoff. “For the past year we’ve been subtracting everything that’s in the way of making the best possible product.”
But the tech in this patent, filed in February, may live to see the light of day, as it fits squarely into the core business which Lütke aims to refocus on: creating tools that are a “copilot” for its merchants.
We’ve got a few more for ya.
Nvidia wants to keep things PG. The company is seeking to patent a method to identify when people are using inappropriate language in gaming sessions as a way to manage users with a “proclivity for toxic behavior.”
EBay knows that fitting rooms are the worst part of clothes shopping. So the company is seeking to patent what it calls a “digital wardrobe” – complete with a user’s own personal avatar – for trying on clothes for sale on its site.
Disney wants to be ready when the latest binge-worthy show hits TVs: The company is seeking to patent a method for “mitigating traffic spikes” on streaming platforms.
What else is new?
Gannett is suing Google over allegations that it illegally monopolizes the advertising tech market, adding to the company’s pile of anticompetition lawsuits against it.
Alibaba founder Jack Ma chose new leadership after CEO and Chairman Daniel Zhang announced plans to step down: Eddie Yongming Wu will become CEO, and Joe Tsai will become chairman starting Sept. 10.
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