What is Live Commerce?
Live Commerce is a service that combines live video streaming with instant purchasing – whether that be from selling an actual product during a stream or receiving support from a social community through a chat function or reaction buttons.
That being said, let’s dive into where this popular trend comes from and where it all started. In May 2016, Alibaba released Taobao Live – which opened a new chapter in sales. China has definitely led the way and has introduced Live Commerce, which made it possible for retailers to connect with their customers on a different level. This new tool bridges the gap between a personalised online shopping experience and getting an immediate engaging response from a sales person. Live Commerce brings customers close to the in-person experience without them having to leave their home, even after shopping hours of brick and mortar stores. Convenience is one of the main reasons this trend is exploding, especially since the pandemic hit.
It has been estimated that the Chinese live e-Commerce market will reach $305 billion USD in 2021, which is a 384% growth compared to 2019. To put it in other words, Live Commerce will account for 15% of all e-Commerce purchases in the country in 2021, and the predictions are that the number will reach 20% in 2022.
What are the benefits of Live Commerce?
Shopping online without assistance can be difficult for many reasons, and without anyone there to ask how big something is or what colours it’s available in can lead to cart abandonment. However, with the virtual presence of a shop assistant or influencer, your questions can be answered right there and then in real-time. This is the biggest benefit of Live Commerce – but there’s more:
Create the in-store experience online
This trend digitises the shopping world. It creates the in-store experience online and that’s exactly what the e-Commerce world has been missing. It’s not simply about just making a purchase anymore, the whole experience around shopping online nowadays involves human interaction to make consumers feel more connected.
Increase you sales conversion rates
Secondly, the add to cart and sales conversion rates are incomparable. Of course, this demands a well thought out marketing strategy to make potential customers aware of the fact you’re selling through Live Commerce solutions. Once people are watching your live stream and interact with your brand, they will invite other people to join – word of mouth is very important in this industry. Also it’s highly recommended to make sure you have the right host for your live streams. It has to be someone who can fascinate people and make them want to buy what you’re selling.
Reach a bigger audience
With Live Commerce, you don’t limit yourself to people who are able to visit your physical store and happen to live close to that area. Product accessibility is unlimited! Live streaming reaches out to larger audiences because literally anyone can join the live stream, which will increase your brand awareness drastically.
Improve your customer relationships
Through live streaming in real-time among other things – people will feel more connected to your brand. Especially when they’re seeing the face behind a product. This can help to build trust with your customers. If they feel familiar with your brand, they’re more likely to return and become life-long customers.
How the retail industry is evolving
Live commerce has evolved rapidly in China, taking less than five years to develop into an innovative sales channel with an estimated penetration of 10%. The value of China’s live-commerce market grew at a compound annual growth rate (CAGR) of more than 280 percent between 2017 and 2020, to reach an estimated $171 billion in 2020. This growth spurt has been intensified by the COVID-19 pandemic, and Chinese sales are expected to reach $423 billion by 2022 according to McKinsey.
The product categories most often showcased in live commerce are apparel and fashion, with a 36 percent share, followed by beauty products and food, with roughly 7% each. Consumer electronics account for some 5%, and furnishing and home decor for almost 4%.
Nowadays companies are hyper focused on bringing video into their digital toolbox, which also means that new job titles are opening. There are so many companies out there that have job roles purely focused on live streaming, live commerce, digital commerce, and virtual selling with video as an anchor. This automatically marks the importance of live commerce. Not only for retailers, but every single market where live commerce could be applicable. This shows the importance of this popular trend that has no sign of slowing down.
Comparing China to the United States, Europe, and the rest of the world – the graph below shows the awareness of online shopping platforms or physical stores that offer livestream e-commerce sessions worldwide in 2021, according to Statista.
In 2021, live commerce had gained considerable popularity in China. According to a survey carried out in the spring of that year, more than seven in ten respondents in China stated that they were aware of online shopping platforms or physical stores that had recently started offering livestream sessions for shopping. In the United States, awareness was lower, with over half of respondents claiming to know of businesses that had integrated this purchase channel. Meanwhile, Europe lagged with 30% of respondents – which means there’s still a lot to gain.
Live Commerce Archetypes
We define three different archetypes of Live Commerce. Those types should match the degree of a company’s maturity in the field. Here’s our selection:
- Basic: Testing the waters and trying out live streaming
Infrequent streams focused on one to five products and relying on the technology of only one specific social media channel – such as TikTok, Instagram or Facebook – or live streaming through marketplaces like Amazon Live, Taobao or Tmall, and tracking performance with KPIs
- Good: Making live commerce a pillar of e-Commerce
Integrating live streaming into your own website, tracking live streaming performance, making a full-time team responsible for managing the live-commerce channel, and setting up automated performance-marketing campaigns to drive targeted traffic to relevant streams
- Great: Scaling up to an innovative data-driven business
Using multiple channels to frequently livestream in different product categories, using analytics-derived insights and machine learning to develop automated real-time prompts, and having a fully-fledged live-commerce department who have proved they can run livestreams on their own.
Live Commerce types & solutions
The possibilities of Live Commerce are endless. There are so many different approaches to discover and you can execute this channel any way you want – as long as you use the solution that suits your business best. Firstly, let’s look at some of the types that are applicable for Live Commerce.
Marketplaces are booming, it’s one of the most rapidly changing industries, and therefore a big trend we’re seeing this year. They’re booming because it’s literally a dream come true for retailers and customers: you can find anything in the same conditions because all product pages are very similar. Buy and sell your products easily on online marketplaces like eBay, Alibaba and many more. By offering real-time interaction, buyers and sellers will feel like they’re at a physical marketplace but in the comfort of their own homes.
Tutorials or product demos
Show your products to your audience by a live demonstration or tutorial. This way, you can showcase (potential) clients how to apply or use a specific product and cross-sell your products – showing how to combine it with other products.
Do you have a brand new product coming up? Launch it through a Live Commerce solution! You attract attention to the new product and convert this interest into sales. Make sure your audience knows upfront about your product launch, so you reach a larger amount of potential buyers.
Live FAQ (frequently asked questions) sessions via video broadcast allow your company to answer frequent customer questions in an efficient manner. Manage your brand message around a service or a product and use a live video broadcast solution to share that information with your customers in a unified way.
But what are all these different inspirational types of Live Commerce when you don’t have the right platform to implement them? Right. That’s where we come in: engage with your customers in real-time and increase your sales through interactive shoppable live streams with Whisbi. Our Engage solution is designed to inspire, educate, and entertain customers in a format that allows real-time brand interactions!
What makes our solution unique?
- Video activation button
Drastically increase your click-through-rates and attract more people to join your live broadcast with our new video activation button! Make your visitors aware of live streaming events on your site and capture their attention with a live preview of the stream.
- Live Video & Live Chat
Your live broadcast viewers can interact with your presenters live via the chat function. The presenters can read the questions and answer in real time during the broadcast.
- Live Video Shopping
Unlike other live stream platforms, our solution allows your website visitors to add items to their basket without needing to leave the live stream!
- Flexible solution to launch broadcasts or campaigns
Launch broadcasts within hours and the only thing you need to take care of is the content and the presenters. We can host your broadcasts on a Whisbi subdomain – easily configurable URL, displayed on the SMS messages used in the SMS Campaign to notify your database about your online event.
- Enterprise-level integrations
Connect Whisbi with tools like Salesforce, Google Analytics and more to sync data and automate workflows.
- First party data
One of the biggest advantages of our solution is that it sits on your website, which means you own all first party data of your web visitors. Whisbi offers a native experience, where you stream directly from your website, using your own design, you own the transaction and also the customer data. When you use platforms like Facebook Live, YouTube Live or Instagram Live – you won’t be able to do that, or to control your brand’s message. With Whisbi you have complete control of all of the above.
To find out how Whisbi can help you implement Live Commerce solutions in your sales strategy and create an engaging online experience, schedule a demo with us.
The future of Live Commerce
Let’s start by saying that the future of Live Commerce is bright. Why? Because only focusing on brick-and-mortar retail was already outdated, and this new platform got a quick start to success due to COVID-19.
Live Commerce is on the rise, not only in China. A study found that, of the 14,460 online adults in France, Poland, Spain, and the United Kingdom surveyed, two thirds have been buying more online, while 70% of surveyed consumers expressed interest in live streaming. Almost half of the surveyed consumers have increased their consumption of ‘shoppertainment’ content as a result of COVID-19.
The study yielded important findings for retailers and sellers interested in exploring Live Commerce solutions. The leading product categories that draw consumers’ attention to live streaming channels are electronics, fashion, and cosmetics. Customers are most engaged when sellers conduct live streaming events, featuring content that is short, trustworthy, relatable, informative – and presented by a host they like.
Regardless of the industry, it’s crucial for brands to see an opportunity in bringing the in-store experience online & understanding the current shopping behaviour and changing the course quickly if they haven’t done so already. Look at it from a sales perspective: brands can create more engaging and interactive ways to move items into the cart and through the checkout process.
Our US Retail Research Report found that the consumers’ interaction with a brand can trigger an immediate and lingering effect on their sense of trust and loyalty. But, it can also backfire when your brand isn’t offering the best and personalised customer experience possible. In this survey, 81% of respondents said they would abandon a brand and switch to another when the customer experience is poor. The focus on engaging with your audience, meeting them on their preferred channel and building capabilities for a fast-changing digital environment is essential.
Customers expect fast, personalized and accurate service where they can engage with brands through their preferred online channels (live chat, live broadcasting, live video shopping, one-to-one video consultations, etc.). This is what they value the most when it comes to shopping online. Live Commerce solutions allow consumers to have real-time conversations with brand experts, which humanizes the online shopping world and brings the customer experience to the in-store level. That should be enough of a trigger for brands to step up their Live Commerce game and get started as soon as possible!
Need help getting started? We’ve got you covered. Talk to one of our experts now!