Ten thousand bottles of facial cleanser sold in 10 seconds. Fifteen thousand lipsticks were snatched up in 15 minutes, and sales exceeded US$1.6 billion in just a few hours.
Welcome to the world of livestream e-commerce, a booming trend in China that is now reaching shoppers in North America. Think of it as The Shopping Channel on social media: Companies host live events extolling the virtues of their products and watch the sales roll in.
During the COVID-19 pandemic, many brands and brick-and-mortar merchants whose businesses were severely affected began to seek new ways to sell their goods online. At the same time, for better pandemic prevention and control, people prefer to shop online, according to a Statistics Canada report.
Livestream is developing rapidly in China, and livestream e-commerce has become mainstream. It has become one of people’s daily pastimes and an important channel for people to buy goods. Alibaba’s Taobao is China’s largest online shopping platform, similar to eBay and Amazon. The vast majority of products on Taobao are brand new items for sale at a fixed price, and the site offers products in almost every category, including: fashion, electronics, appliances, furniture, baby products, and more.
Watch/ How to Livestream to Chinese Consumers
“By comparing online and store, I found that the prices of clothes in offline stores are very different from online, and the prices of items in offline stores are much more expensive than those in livestream,” May Liang, 42, a Taobao customer said in the Toronto Observer interview by phone.
“And there are often discounts and coupons for purchases in livestream, which are very cost-effective.”
People are staying at home to fight the pandemic, offline consumption has decreased, and the consumption and services needed for people’s lives and entertainment has been transferred online on a large scale, which has also prompted a large number of companies to start exploring online sales channels.
Livestream is becoming popular
This trend is spreading beyond China to North America and other countries. Amazon has also launched its live platform in 2016, and TikTok is starting teamed up with Walmart in 2020, where influencers promote products and chat with potential customers in real-time.
Livetream e-commerce may remind us of TV shopping channels, but livestream e-commerce is far more interactive.
The livestream is two-way interactive. During the livestream, the host can answer various questions raised by users in real time and get timely feedback, which can affect sales. Shoppers also can share their reactions and leave comments that other shoppers can see and respond.
The impact of livestream e-commerce
Since 2009, the 24-hour Global Shopping Festival, held annually on Nov. 11 in China, commonly known as “Double Eleven Day,” has often generated higher gross merchandise value than Amazon’s similar Prime Day online sales.
According to data released by Alibaba, in 2020 Tmall’s Double Eleven event, the transaction volume brought by Taobao livestream e-commerce was close to US$6 billion, and more than 33 livestream rooms led to more than US$15 million in transactions.
Sydney Zhu, an influencer with tens of millions of followers, participated in the Double Eleven shopping event with Estee Lauder and Lancome, as well as her own clothing brand called CHINSTUDIO.
“Livestream not only accomplishes sales, but also brand building,” Zhu said in Toronto Observer interview. “The brand’s awareness will be further increased, which will also promote offline sales in the opposite direction.”
The production and operation activities of enterprises have been strongly impacted, and the market sentiment and people’s living and consumption patterns have also undergone great changes in 2020, affected by COVID-19.
Livestream e-commerce has become a new, direct and objective contact channel between manufacturers’ products and users. The anchors introduce products to users through real online trials, that is faster, more convenient, more accurate and also more cost-effective to sell products.
The achievement of livestream e-commerce
According to iiMedia Research, the market size of livestream e-commerce reached US$72.3 billion in 2019. Livestream e-commerce will be the most important consumer behavior in the short term.
The livestreaming sales trend in China has been dominated by influencers such as Austin Li. On the eve of the Double Eleven shopping event in November 2019, he sold a record US$1.8 billion in a one-time 12.5-hour livestream session on Alibaba’s Taobao. His main audience is women, and lipstick is one of his top-selling items.
Li will select good products from the brands that want to seek co-operation with the audience. “Many brands approached me for co-operation, but I rejected them all,” he said in an interview with Xinmin Weekly, a news magazine based in Shanghai.
“I won’t sell products that can make more profit, but choose what I think is good.”