In the midst of the coronavirus pandemic, a new platform is booming, live streaming ecommerce. In fact, a report from iiMedia found that the live shopping trend surpassed $61 billion in transactions during 2019, and is expected to reach more than double that this year.
Physical stores have been forced to close for weeks or months at a time, and live streaming is one of the ways these retailers are connecting with buyers. That’s why Alibaba revealed that in February its live streaming platform Taobao Live had a surge in first-time merchants — 719%. Live streaming ecommerce is becoming big business in China.
But what exactly is live streaming ecommerce? How is it different from television networks? Will it grow outside of China? We’ve asked leaders in the ecommerce industry to weigh in.
What Is Live Streaming Ecommerce?
“Simply put,” explained Donna Davis, owner of Pro Video Talent, “live streaming ecommerce is using the power of live media to sell products and or services.” Companies are selling training courses, physical products, or even asking YouTube audiences to pay to get questions answered or their name mentioned. Online brands are continually finding new and creative ways to leverage live streaming to boost sales.
Oftentimes, however, live streaming ecommerce looks a lot like television live broadcasts such as the Home Shopping Network. “You can demonstrate products, get testimonials, and answer viewer questions live,” Davis added, “all this helps to build excitement and enthusiasm for your marketplace.” These days, anything on television can be replicated online, and often with better results. Unlike television shopping networks, however, viewers don’t need to call or go online for more information, they just click to buy.
Related Article: The Top 10 Ecommerce Trends for 2020
The Growth of Live Stream Shopping
“The coronavirus scare threatens to throw the world into a global recession as workers and consumers stay home,” stated Ning Wang, co-founder and chief business officer of PingPong Financial, “but smart businesses that use online technology like live streaming can not only survive but thrive." It’s a new opportunity for brick-and-mortar brands to adapt to the digital era, and experiment with new sales channels to remain in business. “In fact,” Wang continued, “the pandemic could speed up the adoption of digital platforms, live streaming technology and more."
“The biggest advantage to selling online vs. television,” Davis believes, “is that anyone can do it.” For many brands, advertising on television is cost-prohibitive, with the need to purchase airtime and pay huge production fees. “More than likely, you couldn’t purchase a consistent block of time, such as a half hour live show once a week,” Davis explained, because the networks “like to preempt paid programming with big sporting events or special programming.” She says the alternative is television shopping networks, but they only allow limited products and the competition is fierce, according to Davis.
The Challenges Brands Face With Live Streaming Ecommerce
While live streaming ecommerce has clear advantages, many brands are afraid of live streaming itself. “The very hook that makes people want to watch is what scares the heck out of companies,” Davis explained, “It’s that anything can happen.” Brands can’t control everything that happens during a live stream, and there are risks involved. But, “people don’t expect perfection,” Davis said. The mistakes may even make brands appear more natural and authentic than an overly polished presentation, and that’s part of the appeal for consumers.
With live streaming, ecommerce brands can start small to build confidence in the new sales and marketing channel. Davis said in the beginning you can go live on your phone using Facebook or YouTube to demonstrate your product and tell viewers how to purchase it. “Take it up a notch with a Zoom call shared to your Facebook page,” Davis suggested, “and get customers to tell your audience how they use your products.” You can help create excitement around your product, educate your audience, and build trust through product demonstrations and customer testimonials. “If you’ve already got a following and a few thousand dollars to invest, hire a professional live streaming company,” Davis recommended, “They can help you develop your own broadcast show.”
There’s no telling whether the enormous popularity of live streaming ecommerce will make its way over from China, but with businesses struggling to survive during the coronavirus pandemic, perhaps it’s the best time to experiment. “I do believe that within the next five years,” Davis concluded, “brands who don’t adapt and start using live [streaming] will pay dearly for their fear.”