Livestreaming The Latest Trend In E-commerce

Taobao knows best, with related shopping events throughout the year and limited-time online sales. Research from Everbright Securities has shown that 80 percent of live streaming purchases in 2019 were made on Taobao Live, the first livestream e-commerce channel in China. The other 20 percent is shared by short video platforms Douyin and Kuaishou, who joined the game later. Douyin provides links to Taobao and Tmall, allowing direct purchases within the video streaming application. Kuaishou, the relative newcomer, does the same.

Bai Jiale is the chief operating officer of Kuaishou Technology's e-commerce unit. He told CGTN that since early 2018, many users on his short video platform have been asking about buying merchandise from live streamers. "We want to capture that demand, so we go into livestream e-commerce," Bai said.

In reality, each of the three platforms has its own rhythm with only minor overlaps in product offerings. Taobao Live has the widest selection, backed by Alibaba's online marketplaces. Douyin excels in beauty and fashion from big brands. Kuaishou, while selling products similar to Douyin, made a name for himself in the sales of agricultural products. Many farmers in remote regions have been broadcasting live in Kuaishou during the pandemic closures, selling grown produce to consumers thousands of miles away.

For now, livestream e-commerce accounts for only 9 percent of total e-commerce sales in China and only contributes 1 percent to retail sales. Despite the seemingly wide room for growth, the revenue potential of livestream e-commerce remains uncertain.

Take a look at Douyin. Its parent company, Bytedance, still derives most of its revenue from digital advertising. The company is getting into livestream e-commerce. This is why you don't have enough data yet to prove that live eCommerce really works as an alternative source of income.

Consumers have wildly different opinions. Most of the people who refuse to buy from live streamers are concerned that some of the influencers will exaggerate the features or quality of some products. While the flagship live streamers generate great sales and are paid commissions on those numbers, sometimes the return and refund rate can be as high as 60 percent. Some influencers have also been criticized for reporting false statistics to their brand sponsors. This is due to more demanding, less loyal, and more tech-savvy consumers. Lack of regulation could encourage short-term growth at the expense of long-term health.

The advantage is that livestream e-commerce is a great job creator. If we look at the one-month period after the Chinese New Year holidays, this year's total hires were down by a third from the previous year. But available positions related to livestream streaming doubled in the period. Businesses are hiring fun and charismatic people to promote their products and services online. But these streamers are facing new competition: Many brands aren't even hiring people to sell products online. They are sending their top executives to the fore.

In terms of which products are best suited to live broadcast sales, Wang said that new products that no one else has seen before are the best options to be introduced.

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Hridoy Ahmed Joined: December 15th, 2019