Who would have thought that trendy influencers would one day turn to something as old-fashioned as teleshopping? Now that video is the preferred means of communication among young Millennials and Gen Zs, live stream commerce is becoming all the rage.
Farmer with 15 million followers
2020 marked the breakthrough of live streaming in the West. The big eye-opener was perhaps the moment when the mother of all influencers, Kim Kardashian, reached 13 million Chinese consumers in a matter of minutes and sold out her entire supply of perfume bottles during a livestream event on Alibaba platform Taobao Live.
Taobao Live emerged in 2016 as a way to make online shopping feel more like a store and service experience, but turned out to be a great way to market fresh food online by letting farmers film their harvest. This helped discerning Chinese consumers, for whom fresh food is extremely important, become convinced of the freshness and quality of local agriculture. Today, hundreds of thousands of farmers are livestreaming and some of them are already becoming stars. Even way before the pandemic, farmer Liu Mama earned about 140,000 USD a month with her tractor and her rake and had almost 15 million followers.
Apart from the agricultural industry, however, it is mainly the beauty and fashion industries that benefit from livestreaming, so much so that it has become a regular part of online shopping in China. Every month, videos reach more than 100 million viewers. Two-thirds of Chinese people bought via livestream in 2020, accounting for a total turnover of 60 billion USD. Alibaba achieved sales of 6 billion USD via Taobao Live during the Singles’ Day shopping festival that year. If this continues, live streaming could account for 10 to 20% of all online sales by 2026.
The TikTok challenge
And it does continue: suddenly faced with shop closures in 2020 and 2021, retailers worldwide sought alternatives to market their shopping experience. During the coronavirus lockdowns, European electronics and appliance chain, MediaMarkt, launched ‘live shopping’, interactive online sessions that met halfway between teleshopping and vlogging, led by influencers. Numerous chains, including perfume chain ICI Paris XL, also had their staff stream from the shops to give live advice, present products and answer customer questions.
Today, thanks to the success of YouTube vlogs and TikTok, everyone is jumping on board. Facebook and Instagram first made it possible to buy products from photos, then added what they call live shopping to let brands, retailers and influencers recommend products in videos. Amazon joined the party by creating Amazon Live, with ‘daily bargains’ that are streamed by everyone from fashionistas to sporty grandfathers.
However, almost everyone agrees that TikTok is the future of live commerce in the West. As a Chinese app, it plays to the finer points of the trade like no other. TikTok’s parent company is even investing in Chinese influencers who are creating a furore and earning big bucks on its video platform.
Customer is king, of your brand
The trend shows above all the growing power of the consumer and their network. Shoppers increasingly create their own shopping media, of which they are curators and editors. Content is king, and it is the ‘content creators’ who have the upper hand. If a brand or a retailer lives by its content, it is the content creators who hold the power. So every brand and every retailer benefits from strengthening its ties with its customer community and leveraging their influence.
In China, no longer the brand’s own marketing, but the ‘buzz’ given by the consumer network, makes or breaks a brand. Influencers affect up to half of all purchases and almost half of internet users watch live streams, where people review products live and farmers/producers themselves present their merchandise. It is only a matter of time before Western consumers feel the same way.
This article is an abridged excerpt from the book The Future of Shopping: Re-set Re-tail Re-made, the brand new sequel to the award-winning retail guide (Management Book of the Year 2018). Want to read more about how ‘live commerce’, Chinese, the blockchain and much more are profoundly reshaping the future of retail?