Recent years witness the prosperity of online live streaming. With the development of mobile phones, cameras, and high-speed internet, more and more users are able to broadcast their experiences in live streams on various social platforms, such as Facebook Live and YouTube Live. There are a variety of live streaming applications, including knowledge share, video-gaming, and outdoor traveling.
One of the most important scenarios is live streaming commerce, a new form of online shopping becomes more and more popular, which combines live streaming with E-Commerce activity. The streamers introduce products and interact with their audiences, and hence greatly improve the performance of selling products.
Livestream ecommerce is a business model in which retailers, influencers, or celebrities sell products and services via online video streaming where the presenter demonstrates and discusses the offering and answers audience questions in real-time.
Examples
https://media.nngroup.com/media/editor/2021/02/16/tiktok_livestream_compressed.mp4
During a livestream event hosted by Walmart on TikTok, users watched an influencer presenting various products such as a pair of jeans. Those interested in the jeans could tap the product listing shown at the bottom of the screen. They could also browse the list of products promoted during the livestream and purchase them without leaving the TikTok app. Viewers’ real-time comments appeared along the left-hand side of the livestream feed.
Advantages
- Livestreams allow users to see products in detail and get their questions answered in real time
- During livestream sessions, the hosts can show product details in close-up (left), give instructions of use for products like essential oils and cosmetic face masks (middle), or even show how a particular product, like the tea they’re selling, is made (right)
- Greatly shorten the decision-making time of consumers and provoke the sales volume
- The expert streamers introduce and promote the products in a live streaming manner, which makes the shopping process more interesting and convincing
- Rich and real-time interactions between streamers and their audiences, which makes live streaming a new medium and a powerful marketing tool for E-Commerce
- Viewers not only can watch the showing for product’s looks and functions, but also can ask the streamers to show different or individual perspectives of the products in real-time
Market
Livestream ecommerce has been surging dramatically in China. According to Forbes, this industry is estimated to earn $60 billion annually. In 2019, about 37 percent of the online shoppers in China (265 million people) made livestream purchases. On Taobao’s 2020 annual Single-Day Global Shopping Festival (November 11th), livestreams accounted for $6 billion in sales (twice the amount from the prior year).
Amazon has also launched its live platform, where influencers promote items and chat with potential customers. And Facebook and Instagram are exploring the integration between ecommerce and social media. For instance, the new Shop feature on Instagram allows users to browse products and place orders directly within Instagram — a form of social commerce.
The total GMV driven by live streaming achieved $6 Billion USD. Some quantitative research results show that adopting live streaming in sales can achieve a 21.8% increase in online sales volume.
The Anatomy of a Livestream Session
A typical livestream session has the following basic components:
- The video stream, where the host shows the products, talks about them, and answers questions from the audience. In the Amazon Live case, the stream occupies the most of the screen space.
- The list of products being promoted, with the product currently being shown highlighted. This list appears at the bottom of the Amazon video stream.
- A chat area, where viewers can type questions and comments to interact with the host and other viewers. The chat area is at the right of the live stream on Amazon Live.
- A reaction button, that users can use to send reactions, displayed as animated emojis. The reaction button shows up as a little star icon at the bottom right of the video stream on Amazon.