Livestreamed E-Commerce Drives Conversions and Builds Community 

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Live e-commerce is today’s digital iteration of QVC, and it’s not hard to see why. Using real-time video to allow shoppers to replicate the in-person shopping experience from the comfort of home, shopping via livestream is an optimal blend of streaming, entertainment and instant purchasing.  

And for companies embracing the technology, the interactive sessions have proved they can accelerate sales, drive web traffic and improve brand differentiation. According to a 2021 McKinsey report, livestream shopping generates conversion rates approaching 30% — up to 10 times higher than conventional e-commerce. Taobao Live, the dedicated streaming channel of Alibaba and a top player in the global market, boosts that to 32%. 

Of course, the format is more conducive to some industries than others, with apparel and fashion by far the leading category in livestream events (at a 36% share, according to McKinsey), followed by the beauty industry at 8%.

To date, we have seen a proliferation of influencers or brand representatives doing try-on hauls, intimate conversations with designers introducing their newest collections and live runway events (such as New York Fashion Week: The Shows)—all with interactive features (such as a Q&A with fans), add-to-cart capabilities and personal concierge services. 

For proof of concept, just look to China, where livestream shopping reached 469 million users by June 2022 — 45% of the country’s total internet users, with the market there expected to rake in a staggering $726 billion by the end of 2023.

And while the U.S. still hasn’t caught up to that, more brands every day are leveraging these live experiences to engage with consumers, cultivate communities, build buzz and, in the end, drive sales.   

Livestream Shopping Combines Intimacy With Global Reach  

Even back in 2019, the technology was promising. When Kim Kardashian launched her namesake fragrance in China, she did it from her Ritz-Carlton hotel room in Manhattan. In what felt like a one-on-one Facetime, Kardashian warmly explained the inspiration for the scent, interacted with fan messages and spoke with popular Chinese influencers. The event made Kardashian accessible, and within minutes, she’d reeled in over 13 million Chinese consumers and sold out her perfume.  

Livestream shopping delivers the technological capabilities, reach and scalability of traditional e-commerce, with the added benefit of two-way communication in real time, often including the creator, influencer and like-minded consumers.

This goes far beyond endless rows of SKUs, instead allows potential customers a chance to see how a skirt lays, a zipper glides or makeup blends. And the appeal goes far beyond just the retailer, with the likes of Pinterest and YouTube jumping into the segment and even TV networks mining its potential.  

Worthwhile Experiences Translate to Return on Investment   

The benefits of live video shopping are not limited to mega-brands. With the democratization of direct-to-consumer technology, labels and influencers of all audience sizes can participate — but only if their aims are differentiated with unique programming. For example, a designer introducing a fall collection might offer shoppers a session explaining the inspiration for the fashions and take questions while displaying the wares.  

Conversion rates and sell-through success have proven significantly stronger when paired with a live entertainment experience, but in crafting these tailored experiences, brands should be strategic about the following:  

• Length and Production Quality: Depending on budget and brand identity, livestreams can be done with an entire professional production team or an iPhone. Either way, they should be long enough to build an audience, as, say, 10 minutes isn’t enough time for viewers to join, tell their friends and truly engage.
• Timing and Frequency: Companies should aim to present their live events at a consistent cadence and, when possible, target buzzworthy moments (holidays, new collections, limited editions).
• Life of Content: Live commerce can — and should — be posted as video on demand to extend the session’s shelf-life, as products are buyable after the fact if not sold out.  
• Host Platform: Brands can hold their events on third-party avenues, such as social media or owned-and-operated OTT platforms, though those can limit a brand’s ability to capture consumer data, upsell and cross-sell.

Sellers should avoid venturing into live e-commerce unless they are prepared to engage directly with shoppers and put in the work to build community (and thus equity).

Both require consistency, authenticity, passion and real engagement, and anyone entering the space should partner with experts who can provide the platform, capability and counsel needed to scale up. Brands whose e-commerce strategy is just “list-and-sell” might lack the foundation to make good on such an investment.     

The Path Forward for Live Video in the U.S.  

For a blueprint on how to grow the live-shopping market domestically, one again needs to look to China, which has nailed the format’s storytelling aspect. The U.S. market, in its more embryonic stage, is largely predicated on brands paying influencers to pitch products, and the impact isn’t yet quite as genuine.  

But over time, as the space matures and companies become more strategic, the entertainment aspect in the U.S. will become more organic and live video shopping will develop into a more recognizable — and repeatable — format.  

Fred Santarpia is a digital media and business transformation expert. He currently serves as president of Endeavor Streaming, where he spearheads the company’s global expansion strategy. 

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