Live Stream Commerce The Future Social Trend for Ecommerce


Live commerce means using live stream video broadcast on the internet to sell products to viewers. Sellers can live stream on social media, specialist live stream sites or their own eCommerce website, and they often draft in the help of influencers to advertise the product.


Estimates put the market size of live eCommerce at US$60 billion in 2019, with China being the biggest market and the rest of Southeast Asia not far behind. Forrester even predicts that live stream commerce in China will reach US$100 billion by 2023, representing a compound annual growth rate (CAGR) of 45.7%.


Today, we will explore how live stream eCommerce works, why the live commerce market size is increasing, what challenges live commerce faces to widespread adoption and what the future holds.


Live Stream Commerce The Future Social Trend for Ecommerce

How Does Live Commerce Work?


Live shopping is the natural evolution on the internet of home shopping TV channels like QVC and Home Shopping Network. Instead of pre-recorded sales pitches, live stream shopping relies on real-time video delivery. Oftentimes, the brand will approach a famous and popular social media influencer before the live stream event to get them to sell the product for them. Products commonly sold on live stream include cosmetics, clothing and footwear, but also sometimes food and high-end alcoholic beverages.


In China, for instance, where live commerce is most widespread and advanced, the influencers are known as Key Opinion Leaders (KOLs). According to an assessment by Forbes, they work for around 4 hours straight, advertising an average of 12 heavily discounted products every hour, while viewers and buyers can comment and call in to interact with them and ask for more details about the products. Many live streaming shows also include musical elements and celebrity guests to attract more people to watch, so it becomes about more than just shopping, but a whole entertainment experience.


Where Can I Watch a Live Stream?


Delivery methods for live stream commerce include:

  • Social media. When this is delivered on social media platforms like Facebook, Instagram and WeChat, streaming eCommerce is an aspect of social commerce.
  • Ecommerce websites. Live commerce videos are streamed directly on the retailer’s eCommerce website.
  • Ecommerce marketplaces. Well-known marketplaces such as with Amazon Live and Taobao have their own live streaming capabilities.
  • Live stream websites. Retailers can harness the video technology of specialist live streaming platform services and live commerce apps like TalkShopLive and Brandlive.
  • Real-life events. It’s also possible to organise a live-streamed commerce action at a physical event as Nordic fashion brand Boozt did at the Stockholm Fashion Week 2021.

Why Is Live Stream Commerce Becoming More Popular?


Live commerce is a relatively recent digital shopping experience that is enabled by emerging new online video technology. According to the Gartner Hype Cycle for Digital Commerce 2020, live commerce is near the peak of the first wave of expectation and experimentation, and will take another two years to reach the plateau of widespread adoption by the general public.


Live commerce is increasing in popularity for 4 main reasons:

  • COVID-19. The Coronavirus pandemic, as well as accelerating the trend towards online shopping by up to ten years, has also made us more comfortable using video call services like Zoom for business and to connect with friends and family. It’s not a huge jump from there to buying from video.
  • People want personalisation. Live streaming commerce has a more personal feeling than TV shopping thanks to the interactive nature of the comments section on a live stream and the instant reaction the hosts of these videos can give to viewers. It brings back the feeling of buying from a real person as we did in days gone by from sales assistants in store, helping to enhance the customer experience by bringing human warmth back into the impersonal and efficient world of next-day delivery. The desire for a personal, human touch is also partly the product of the fear and isolation of living in a world of lockdown and social distancing in 2020-21.
  • Influencers are cool. People who are into Instagram, TikTok and Twitter want to see their favourite social media celebrities. With influencer marketing, brands tap into this fandom and offer influencers vast sums of money to promote their products, not just on their profiles and in their stories, but in live selling events and sometimes even online auctions.
  • Digital commerce technology is more powerful. None of this would be possible without the increasing trend towards smarter and more accessible technology into customer-facing internet applications. While not all live streaming eCommerce takes place on social media, this is especially true of payment gateways being integrated into social networks like Facebook and YouTube, combining the two forces of live video and digital shopping.

The Challenges Facing Live Commerce


Despite these drivers of audiovisuals in digital commerce, it will still take years for shopping online by live broadcast to become mainstream. Some of the hurdles that have to be overcome are:

  • Consumer readiness. For shoppers used to browsing through product lists and comparing customer reviews as their main form of retail activity, watching live stream videos can seem like an exhausting and time-consuming chore. Having a firm idea of what you want to buy and searching for it directly seems like a much more efficient means of shopping, although it lacks some important aspect of product discovery that live streaming provides. Brands will have to convince shoppers of the benefits of live stream shopping before they try it for the first time, yet alone continue to use it regularly.
  • Choice paralysis. Once live commerce does gain a foothold in the wider world of social commerce and eCommerce, it will face that dreaded anathema of all eCommerce merchants: choice paralysis. If there are thousands of options to choose from when it comes to shopping via live stream, potential customers are just as likely to choose none of them as they are the best one.
  • Customer loyalty. Getting them ‘in the door’, so to speak, is just the beginning. The greater challenge for brands marketing and selling products via live video broadcasts is customer retention. Special discounts and coupons for return customers are just one way of ensuring repeat purchases, but the market will need to innovate new means of bringing people back again for more live streams in the future.
  • Cost of setup. As if these kinds of discounts weren’t enough, products normally sell for a heavily discounted price on live shopping streams anyway. It’s an expensive investment to set up a live stream shopping experience, and to get a reasonable ROI merchants will need to find ways to offset these costs.

“Organizations need to have a strategy to upsell from a few loss-leading products so they can justify the investment.” – Sandy Shen, Gartner

  • Willingness to prepare. Not only is it expensive to run a commerce live stream, but it takes a lot of planning resources too. Merchants need to be prepared to invest time, and not just money, into scene preparation, brand awareness and advertising the event to make it a success because if you’re not going to do it well, you might as well not do it at all.
  • Lack of technological integration. While it’s true that the technology for live streaming is improving on Facebook, Amazon and other eCommerce staples, it’s still not well integrated with the experience that people expect of online commerce. Until social media platforms and eCommerce marketplaces can pull together their tech ambitions with the human experiential factor, live social commerce will not take off.

What Is the Future of Live Commerce?


It’s important to note here that in live commerce, as in almost all other eCommerce trends, Chinese shopping habits and technological capabilities are at least 3 years ahead of the rest of the world. Digital payments via the Chinese service provider WePay were available on eCommerce websites and social media platforms long before PayPal was linked to Facebook; shopping on mobile devices, mCommerce, first grew in popularity in China before it did in the West. For an idea of what the future will hold for live streaming commerce, look to the East.

As pointed out by The China Guys, the Chinese experience indicates that the future of live commerce includes:

  • Use by older target markets. There will be greater adoption of live commerce by more audience segments than just young people in the 18-35 bracket, but older shoppers over 35 years old too.
  • Rich video content. Content will strive to be funnier and more meaningful, designed to make consumers feel like they are receiving a more rounded shopping and entertainment experience instead of just a callously calculated sales pitch.
  • More micro-influencers. In order to deliver the most useful and informative content to viewers, brands will rely less on big-name influencers and instead seek out niche experts to attract consumers in their particular field, be it gaming, fine wines or self-help books.
  • Expansion into different verticals. Live streaming will extend to more sectors than just eCommerce sales, but will include health advice and medical consultations, too, as Baidu is planning to do with its live streaming service, Haokan. Think of an industry – any industry, from finance to engineering to government procedures – and chances are its products and services are able to be offered via live video and/or social media.

SmartOSC helps eCommerce merchants reach their full potential. Reach out to us for a chat anytime.