Technology has an essential impact on our day-to-day activities. And the way we purchase goods and commodities makes no difference. Since 1994, when the first product was bought online, commerce has seen many transformations. But probably none as big as Livestream Shopping.
Today, online buyers are looking for new shopping experiences now more than ever. A study conducted at the end of 2020 showed that more than 50% of digital shoppers are looking for more engaging shopping journeys. Now, with the “commodification” of the goods, not products are the ones lacking. But great, memorable shopping experiences. Let’s not forget that we live in an experiential economy where how we obtain a product is often more important than the product itself.
Let’s see how commerce is reshaped by this new way of buying.
But first, let’s see what is Livestream Shopping
A very simple definition would be shoppable video. Livestream shopping sessions are live video events where viewers watch somebody present a product or service, interact with them, and at the desired moment they buy the products straight from the video experience. So, on one side we have somebody showcasing something, and on the other side, we have somebody that wants to purchase the product. As you can see, although there are a lot of myths about livestream shopping, it is in fact a very straightforward process.
It’s an interactive experience that fills the gap between traditional (in-store) purchasing and eCommerce by taking the best from both processes. Let’s see how.
According to a 2018 National Retail Federation (NRF) study, the main reason for which people like to purchase in-store is the fact that they have a better feel and look of the products. For more than a quarter of the interviewed consumers, the ability to discuss with a shop assistant is crucial when purchasing products. And 1 out 5 customers shop in-store because of the overall atmosphere. Let’s not forget that shopping is often more about the experience than it is about the actual products that we are buying.
eCommerce provides us the ability to shop every store in the world without actually leaving the comfort of our homes. With just a few clicks of a button, we can just buy products from Sidney, London, or Tokyo without even having to pause the Netflix show that we were watching.
Of course, each of the two shopping methods comes with its flaws. While in-store shopping is time-consuming, eCommerce is faceless and impersonal. While shops have working hours (and sometimes, as we have just experienced, are forced to stay closed for a long time), eCommerce often fails to answer the questions that we are looking for when looking to purchase a product.
We know brick-and-mortar shops that also sell online. We know direct-to-consumer brands, that started online, opening physical stores to help customers have a better understanding of their products. And now we are learning about the technology that fills this gap.
This is what makes livestream shopping so powerful. It takes the best from both shopping journeys and combines them into one that offers a new experience. It lets customers interact with a shop assistant live, without having to leave home, creating a unique experience for your customers. Livestream shopping is gaining more and more ground as it’s extremely popular with younger generations of shoppers.
Livestream shopping is gaining ground
The speed with which technology conquers new territories is astonishing. And as one of the most dynamic industries out there, eCommerce makes no difference when it comes to the speed with which it makes its presence in our daily lives. And neither does video commerce. Here are the livestream shopping statistics backing up this affirmation:
Digital transactions as part of total retail sales.
According to Statista, from 2019 to 2021, eCommerce transactions grew by over 40%, from 13.6 to 19.5 – as part of total retail sales. It’s expected that by 2024, eCommerce will represent almost 22% of the total retail sales. 3 times more than what it was back in 2015.
The growth is even more accelerated for livestream shopping.
China, the biggest eCommerce market, it’s also dominating the live shopping phenomenon. Backed up by platforms like Taobao, where more than half of the shoppers purchase directly from live video experiences, its total live shopping market size it’s expected to reach almost $413 billion by the end of 2023. Nearly 230 times more than in 2015, when it was evaluated at “just” $1.8 billion.
In 2019, 37% of Chinese online shoppers made at least one purchase straight from a live stream shopping event, accounting for a total of 4.5% of the total online shopping gross value. In 2020, two out of three Chinese consumers bought products via live streams, according to McKinsey Digital.
By the end of 2022, 20% of the total online shopping gross value will come from livestream purchases. For every 5 dollars spent on online shopping, one will be spent through real-time video shopping.
In the US, the livestream shopping market will end 2021 at around $11 billion, with total retail eCommerce sales of roughly $470 billion. However, the prediction for the next 2 years shows the magnitude of this new experiential way of buying. While eCommerce retail sales will see a 12% increase, the live commerce one will more than double its value, up to $23 billion. And this is just the beginning. Online customers are looking for new buying experiences, where the human touch is not missing from the overall experience.
Livestream shopping can bring conversational commerce into the online space. But more than that, it brings the human touch eCommerce is missing. It stands against faceless commerce, supports online businesses that want to bring the perks of in-store shopping to the online environment.
Both eastern and western eCommerce markets are rapidly adopting the trend that is transforming the old, impersonal digital commerce. The new, human, interface transforms online shopping into an engaging journey, helping both customers and brands.
What do customers expect from your sessions?
Internet users spend more time (3x) consuming live video than any other form of content. One reason is that, regardless of the number of viewers, creating a sentiment of intimacy around the experience. To put it otherwise: if you go live in front of 100 viewers, you will create 100 unique experiences for 100 different people.
Customers expect authenticity, a real feeling of your brand and products. They expect to be heard and have their questions answered. But most of all, they expect a seamless shopping experience. One that helps them get a better understanding of your products. And the best part is that this applies to any industry.
As a study conducted by Everbright Securities, iResearch, and McKinsey revealed, although Fashion and Beauty industries lead the way of live shopping, other industries are rapidly adopting it as well.
Getting started with livestream shopping
Deciding to use live shopping in your sales process is just Step no. 1 in the process. But fear not; with the right guidance, the process itself becomes uncomplicated. There are several things you need to take into consideration, and luckily for you, we are here to guide you through.
But firsts, let’s look at eCommerce from a social perspective. I am sure that by now you have come across social commerce. The term, first used back in 2005, defines the combination between commerce and online media that support a form of social interaction and engagement (including, but not limited to, social media platforms).
As consumer habits change, brands are looking to transform the online shopping experience. From a rather static one to a dynamic one that engages the customer and builds trust.
There are two main directions for live commerce: owned and third-party platforms. Simply put, brands can create live shopping sessions either on social media platforms or on their owned platforms (websites and apps).
As online commerce becomes more and more social, the big players in the industry have made it easier for brands to sell straight from their platforms.
Meta Platforms, Inc. has added live shopping capabilities to both Facebook and Instagram in order to shorten the customer journey. As 43% of consumers use social media to discover new products and brands (according to a study conducted by Sprout Social), brands can leverage the momentum and allow customers to buy the products from the social platform itself.
TikTok is also joining the livestream shopping race – and it’s actually doing a great job. One of their first steps in this direction was to partner up with Shopify to allow users to shop directly into the app. TikTok has also run live shopping sessions with Walmart, and while the sales numbers have not been disclosed, the brand reported a 25% growth to their fan base.
Brands embrace the opportunity of creating new shopping journeys on social media platforms for the obvious reasons – most of their fans follow them on big tech platforms. But what happens if you actually own the customer journey?
This gets us to the second scenario – creating shopping sessions on owned platforms. Brands can easily do it with the help of a live shopping software solution. This type of experience can be fully customized, allowing brands to own and control the whole customer journey and to collect zero-party data.
Actually owning the experience means that brands can use these sessions long after the live event has ended. As studies show that an important percentage of sales generated by live shopping comes after the live is actually over, having the possibility to keep the video experience on is crucial.
However, the two options mentioned above do not exclude each other. They actually work hand in hand, helping brands reach broader audiences and establish trust among their followers. Social media platforms are a great way to get started with livestream shopping, but opening a branded channel on your platform will give you total control over the entire customer journey. Let’s dig deeper and see what you should have in mind.