Live shopping in China has boomed over the past year; it is now estimated to be worth over $60 billion annually, and this trajectory is showing no signs of stopping.
Livestream shopping first originated in China and now has over 524M+ live streamers and generated an estimated $170Bn in 2020 while the west is now playing catchup with Amazon, Google, Instagram and Youtube testing their own version of shoppertainment.
Ecommerce in China has always been big business- and the effects of COVID have accelerated this growth exponentially. Globally, China has always been a few steps ahead of the rest of the world in terms of ecommerce trends. Chinese consumers are generally more comfortable with interactive video platforms than their international counterparts.
According to Forbes, in 2020 over 700 million Chinese consumers shopped online compared to 600 million in 2018. According to eMarketer, over 35% of total retail sales in the country were made online in 2019, this is three times higher than in the US. Chinese consumers have always been accustomed to shifts in digital trends, making them incredibly open to new/advancing forms of technology.
In the U.S., the livestreaming market was worth about $6 billion last year and could reach $11 billion by the end of this year, according to consumer market research group Coresight Research. It expects the market could eclipse $25 billion by 2023.
The trend is growing globally with the live shopping market in India estimated to reach US$35B+ by 2025- it is a worldwide phenomenon.
Live stream shopping in China is a huge part of the retail landscape, it has been hailed as a hybrid between an infomercial and a tv skit. Popular influencers host live shopping experiences on China’s top online retailers in order to sell products, but also to connect with their audiences and grow brand popularity.
The featured influencers are charismatic, persuasive and relatable personalities that demonstrate the products to the audience. This friendly form of conversational commerce encourages the audience to buy without the pressure often associated with more formal sales methods.
This has proven to be a winning formula in the region as in 2020, over 560 million consumers viewed livestreams. Amazingly, live stream purchases amounted to 9% of total online sales (over 100% increase from 2019).
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At the heart of Chinese live stream trends are the influencers themselves. They each host a 4hr ‘show’ a night whereby they present 12 products per hour, 48 in total. Intriguingly, it isn't easy for brands to get their products onto these shows as they have to pitch to influencers in order to win a spot and roughly only 1 in 8 get chosen to feature.
Influencers hold the power to sell out products in seconds, raking in millions of dollars every night. On top of this, the influencers negotiate with brands in order to get discounts for their audiences, boosting their influence and success.
These live shopping shows really are a spectacle. On top of showcasing, explaining and trialling products, guest celebrities often appear as well as ad hoc singing and dancing. It’s this fun, unpolished and interactive way of showcasing products that ensure sky high sales. As a result, the consumer forgets that this is a paid activity designed to make sales!
Though the uptake of video ecommerce has been slower in western markets, trends are undoubtedly shifting in favour of this immersive and interactive way of shopping. Smartzer has seen fantastic results amongst our brand collaborations for live shopping events so far, with an average of 55% of viewers engaging with the shoppable live streams and CTR ranging from 20-75%.
China has certainly paved the way for the future of shopping, even though in western markets the features of these live streams may be adapted and optimised for the western viewer.
Ecommerce as we know it is evolving, and now is a great time for brands to embrace the change and integrate a different way of buying that satisfies shifting consumer needs and behaviours.
To learn more about shoppable video and live stream, visit Smartzer here!