Live shopping is one of today’s most exciting ecommerce technologies. But although it’s a hit elsewhere in the world—especially in Asia—it’s still emerging in the U.S. At least for now.
In the first of this two-part series, I’ll help you prepare for the live shopping future by providing an overview of the technology, outlining best practices learned from overseas brands and reviewing barriers to adoption. In part two, I’ll share exclusive interviews with Chinese and American shoppers in an effort to better understand two different, but evolving, consumer perspectives.
What Is Live Shopping?
Also known as livestream shopping, today’s version of live shopping is a hybrid digital entertainment-ecommerce experience where viewers interact with hosts and shop in real time. Sometimes it’s just one host introducing products and answering viewer questions. It can also be a much bigger production, like a fashion show or a celebrity interview.
There are two ways for brands to offer live shopping: with tools built into existing accounts, or by using third-party apps and platforms.
Live Shopping on Instagram (and Everywhere Else)
Even if you can’t offer a direct purchase option on your platform of choice, you can still use a livestream to demo products, promote sales and direct viewers to your ecommerce site. Tip: If you do this, provide a unique discount code customers can enter at checkout so you can track the stream’s impact on sales.
Currently, Instagram is ahead of other American platforms when it comes to the state of its native live shopping tools.
Here’s where things stand as of July 2021:
- Instagram: Your Business account must have Checkout enabled. Then, tag products to feature them on-screen and make them available for purchase during a Live.
- Facebook: This feature may not be available on all accounts. Those that have it can build a product playlist in Commerce Manager, then go live from their business Page.
- Amazon: Amazon can produce a stream for you (for a steep fee), or you can do your own via the Amazon Live Creator app. It’s only available in the U.S. to vendors with a Store and professional sellers enrolled in the Amazon Brand Registry.
- TikTok: Walmart began piloting Live Stream Shopping in early 2021, and TikTok has begun adding to its live features in preparation for wider rollout.
- YouTube: In 2021 YouTube began beta-testing “an integrated shopping experience” that now includes livestream pilots with a few select brands.
- Twitch: Live shopping seems like a natural fit for the video streaming platform, but so far, its efforts have been limited to Amazon Prime Day streams.
China: Live Shopping Statistics for 2021
According to iResearch, live commerce was just 0.35% of China’s total ecommerce sales in 2017. Today it’s 20%. The Chinese live shopping market is expected to exceed $300 billion by the end of 2021, and thanks to increased ecommerce activity during the pandemic, almost 30% of Chinese internet users shop via livestream.
Seeing this opportunity, brands are rushing to get in on live shopping. In the past year, the number of merchants on Taobao Live, the Alibaba-owned platform, has increased by 220%. Popular apps like WeChat, Xiaohongshu, Douyin and Pinduoduo also have active live shopping features and content.
Why Shoppers Tune In: Best Practices
With so many streams competing for shoppers’ attention, brands in China have developed effective ways to attract an audience and keep people coming back for more.
Make It Worth Watching
Perhaps the most important factor is entertainment value. Ecommerce streamers make up a significant portion of China’s influencer economy, and just like TikTok stars and vloggers in the West, they have built their own fanbases by showcasing their personalities and humor. Professional shopping hosts are sponsored or hired by brands, which fund streams with quality production. These hosts don’t just demonstrate products and answer questions: They also entertain viewers with jokes and authentic opinions. Many perform with a partner who helps create hype, fill in product information and remind viewers of discounts and other details.
Offer Time-Limited Incentives
To encourage on-the-spot buying, many Chinese live shopping events offer steep discounts and free samples that are only available during the livestream. Popular products can sell out almost instantly with this strategy.
Real-time sweepstakes are another way to build excitement. To do this, the host takes screenshots of incoming comments and selects random viewers to win free products. This encourages participation in the stream (you have to comment if you want a chance to win), and often drives other viewers straight to the buy button. FOMO is a powerful thing!
Without a doubt, the biggest difference between live shopping in China and the U.S. right now is the seamlessness of Chinese streaming technology. Live shopping is so tightly integrated with the country’s most popular ecommerce, social and payment platforms that there’s almost no friction between discovery and checkout.
Because the experience is already easy, it’s important to avoid doing anything that might lead to frustration. By providing relevant product information with creative content tailored to their audience, brands can make it easy for shoppers to notice an item and make an informed decision to buy—all within ten minutes of joining the livestream. There really aren’t other ecommerce tools that can speed up consideration this fast, or this effectively. But it takes the right technology and UX to make it happen.
Barriers to Live Shopping in the U.S.
There are three main reasons why live shopping hasn’t caught on in the United States the way it has in China:
- The technology. Until American social platforms provide easy on-platform checkout during livestreams, most consumers won’t be interested. People have gotten used to concepts like one-click checkout and “tap to buy”—there’s no going back to multiple steps and screens.
- The fragmented environment. As some brands build live shopping capabilities into their websites, while others gravitate toward Instagram Live, and others bet on standalone shopping apps, the overall experience of live shopping remains inconsistent. And while some brands may find value in adding a live element to their ecommerce site, it will also be challenging to attract an audience and gain traction.
- The content. Let’s face it: You don’t go to Amazon to be entertained. It’s a platform built for fast, straightforward transactions, and although there have been efforts to develop live shopping content, Amazon still isn’t a destination for those who want something to watch. The same is true for almost every U.S. ecommerce platform.
However, the landscape will surely look a lot different a year from now. Having seen the staggering statistics from Asia, U.S. tech companies and retailers are fully aware of the potential live shopping holds. As technology improves, consumer awareness increases and quality content gets developed, it’s inevitable that more and more Americans will be tuning in to live shopping events.
In part two of this series, I’ll take a deeper dive into live shopping from the consumer’s point of view, and share key insights from my interviews with shoppers in China and the United States.