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Live Commerce in China For Small And Big Brands

August 27, 2019

Like many other things in China, livestreaming has taken on a different route and trajectory to the rest of the world. In other regions, livestreaming is focused on social and gaming. In China, livestreaming has these dimensions too, and has found an important role in e-commerce, creating China’s Live Commerce industry. Last year, Alibaba’s Taobao Marketplace generated more than RMB 100 billion (USD$15.1 billion) in gross merchandise volume (GMV) through livestreaming sessions, an increase of almost 400% year-on-year.

china livestreaming
Source: ALIZILA

Taobao is where the action is at. According to figures from Alibaba, the Taobao ecosystem is home to 4,000 livestreaming hosts, who generate 150,000 hours of content on a daily basis, covering 600,000 products. Deloitte figures suggest that that content is lapped up by a total of 450 million viewers, which is more than two-thirds of Taobao users.

china livestreaming
Source: TOLMAO GROUP

One of the more acclaimed China livestreaming hosts, Viya, can sell millions in one sitting. In August, she generated close to $30 million in sales of New Zealand products in four-and-a-half hours. That was a huge boon for small brands who participated in the livestream, such as Trilogy, Wild Ferns, Linden Leaves, and The Collection.

china livestreaming

There are good reasons for the strong uptake:

  • Livestream hosts (KOLs, as they’re called in China) carefully curate their product selections to their fan’s tastes. That leads to high conversion rates. Indeed, Taobao boasts that its conversion rate across livestream is an astonishing 32 percent. That is, for every one million viewers a livestream reaches, 320,000 will add the showcased product to cart, proof of China’s live commerce success.
  • Viewers can see products in action. This is particularly helpful for a number of product categories, like color cosmetics, clothes and furniture, where size, colour and effect aren’t easily discerned from stock photos or videos.
  • Users’ questions about the product can be answered instantly. Everything from “Can we see what it looks like from another angle?” to “Can my toddler eat this?” can be answered directly by the livestream host, or customer service reps who read and answer user comments.

Here are a few things to get you thinking about the opportunity of using Livestreaming in China, and a few places where AgencyChina might be able to help:

  • See whether livestreaming has hit your product category yet. You might be surprised to find that livestreaming is already an emerging sales channel in your category. Alternatively, you might still have the chance to take an early lead and get your category exposed through live commerce.
  • Work out what role livestreaming plays in your China strategy. Livestreaming is great for taking folks very quickly from awareness, to interest, to purchase. It’s also great at convincing those who are sitting on a potential purchase. But it can’t work in isolation.  
  • Ascertain what talent works best for your brand. With over 4,000 livestream hosts in the Taobao ecosystem, you’re spoilt for choice. Shortlisting talent that’s interested in your product, and cross-referencing that with who’s got the fans, sales skills and partnership acumen is a process that you need to undertake.

That might sound a little overwhelming, but AgencyChina’s here to help, with services that stretch across shortlisting, to strategy, executing strongly with chosen talent.    

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