Interactive video (IV) is a digital multimedia presentation that can take user input to perform some action.
At its simplest, an interactive video might connect the user to an external website. A shoppable video, for example, might demonstrate a product and include hot links to take users to the vendor's website to learn more or make a purchase.
Interactive video has many possible applications. An interactive video for distance education, for example, could allow students to select among multiple channels for further information at points throughout the presentation. It could also include a quiz after a lecture segment that evaluates responses and gives students immediate feedback.
Interactive video content for gaming allows the player to select among various options that determine subsequent story lines in the game. As in real life, each choice can lead to a different consequences, so that potential story lines can vary quite significantly.
See an interactive instructional video on building a PC: