Go live and grow. Livestreaming is the future
Livestreaming is not exactly new, but lockdowns and the surge of online shopping has rekindled brands’ awareness of the power offered by live and entertaining product promotions.
Has livestreaming found fresh legs in the West? If the trend on US social media is anything to go by, then the answer is a resounding “yes”. Over the past few months, almost every major social network has expanded their services to include the capability for brands to take advantage of live commerce opportunities to promote their products.
People may wonder what is the difference between livestreaming and live commerce? As we know, livestreaming has been with us for some time and has its roots firmly in gaming and entertainment such as music and comedy shows. Live commerce is a relatively recent development that sits underneath the catch-all umbrella of livestreaming and refers purely to selling products via a live, online event. So, the ‘live’ format is used, but only for eCommerce purposes, hence live commerce. Anything non-sales (gaming, music etc), is still referred to as livestreaming.
Why wouldn’t we want to follow China, where the use of live commerce in the promotion and sale of products is now firmly established in the Chinese shopping culture? Seeing products in detail and answering questions in real time is a business model that works. This can be seen with the likes of Taobao Live, a virtual shopping mall with entertainment thrown in for good measure. According to Forbes, the Chinese live commerce market tracked $150 billion in 2020, and the US and the rest of the western world are poised to start catching up. Forecasters are saying that the US live commerce market in 2023 will be worth $25 billion[1]. However, by that time the Chinese market will most likely have doubled.
Livestreaming developments within social media
In December 2020, Tik Tok partnered with Walmart to deliver their first live commerce events, a trend that repeated in March 2021, with Walmart stating that they saw a 25% increase in their follower count as a result[2].
Instagram has a new SHOP feature that allows shoppers to browse and, more importantly, makes it easy for them to place orders there and then.
In May 2021, Facebook introduced ‘Live Shopping Fridays’, allowing brands to showcase products whereupon consumers can add product selections to their cart and checkout. We know from experience that shopping in this way usually increases the wallet spend and reduces the number of abandoned carts.
The online shopping part of Instagram (Instagram Merchant) has introduced a service called Live Rooms for brands to showcase their products. Initially, it was aimed only at brands who use Instagram’s in-app payment system and started with one host per livestream event. This has now expanded to allow up to four hosts, each of whom will bring their own followers. Clearly it’s designed to attract more people and grow your following, and logic dictates that sales should also grow.
Pinterest showcased its first live commerce event in May 2021, allowing viewers to shop products promoted during the sessions and hold dialogue with the hosts.
Social platforms have no difficulty in promoting their online shopping strategies, nor do they struggle to attract big-name brands. It is still early days for live commerce in the US. A recent Harris Poll stated that 38% of US adults said they had watched a livestreaming event, but only 7% said they ultimately bought a product following a live commerce event[3].
It’s not just product sales that are suited to livestreaming. During lockdowns, some musicians have used livestreaming as a way to hold virtual concerts, and a specialist livestreaming service called LIVE NOW started in August 2020 with a pay-to-view offering for live music and comedy. LIVE NOW does not envisage a downturn in business just because the world is opening up again. If a stadium can host 80,000 fans enjoying their favourite group, why can’t an even larger number watch it live from the comfort of their living room, especially if travelling to the venue would be too far and, therefore, difficult.
In conclusion
Livestreaming is a powerful way to interact with consumers and is definitely here to stay. In China livestreaming and live commerce are huge industries with almost 195 million people likely to make a purchase through social media live commerce events this year alone[4]. Live commerce isn’t just confined to social media platforms though. It’s expanding rapidly across digital commerce generally and can be seen on many eRetailer’s websites. eBusiness Institute works with brands and helps them develop this powerful tool to drive traffic to their website and, ultimately, increase sales.
One factor behind the successful growth of live commerce is the humanising effect that allows someone to promote their products and services directly to an audience. As John Ruskin once said in 1890 “people do business with people” and that’s as true today as it ever was. Livestreaming is a trend that’s still developing in the US, and whilst sales take up within that is considered low at present (only 7% have actually made a purchase), the speed at which live commerce will accelerate as part of the overall livestreaming trend might take brands by surprise, so they should remain aware of the potential.
A vital component to success, however, is the ease with which consumers can make a purchase. There’s no point in having a great product that’s well understood due to the brilliance of the host’s demonstration, if you can’t find the buy now button.
eBusiness Institute, keeping brands appraised of developing online experiences within the livestreaming trend.
Visit our Live Commerce page to find out more and, whilst there, why not book a free demo and see for yourself the power of the eBusiness Institute Live Commerce service offering.
Sources
[1] https://www.forbes.com/sites/kristinlarson/2021/03/27/retailers-embrace-livestreaming-market-expected-to-reach-11-billion-in-2021/?sh=6a12a3ca2fde
[2][3][4] https://www.emarketer.com/content/how-important-will-livestreaming-social-commerce-2021
Originally published at https://ebusinessinstitute.com on August 09, 2021.
