What trend emerges when you combine teleshopping, online live streams and e-commerce platforms? It’s all about the exciting digital shopping spree, better known as live shopping. More and more brands are relying on live shopping events as a marketing strategy for presenting and modelling their products. The following article reveals how companies are successfully jumping on the megatrend from China and winning over their audience.
Livestream vs. teleshopping: what is it anyway?
Livestream shopping, or live shopping for short, is basically a marketing strategy in which a host – often an influencer or celebrity – advertises one or more products in a live video. The concept is often compared to well-known home shopping programmes from TV, in which presenters demonstrate how a particular product works. With livestream shopping, however, the entire interaction between the host and the audience takes place in real time, as the name suggests. Potential customers can therefore interact live with the host, ask questions or make comments while the host is still presenting the relevant content. Such broadcasts are usually transmitted via e-commerce apps, social platforms such as YouTube, TikTok and Twitch or websites such as Taobao or Amazon.
As with traditional teleshopping, live shopping also emphasises the vivid presentation of the desired products and the possibility of an immediate purchase. Both concepts also aim to convince viewers with one-off special offers and supposed bargains. Nevertheless, the potential of teleshopping is exhausted relatively quickly – only a limited selection of products is available during a programme and these can only be ordered by telephone. As already mentioned, live stream shopping allows the audience to interact directly with the host and follow the programme live without prior editing. Although traditional teleshopping is still very popular, especially among older people, younger generations are increasingly watching shopping livestreams online.
Billions in sales: live shopping in figures
While the profit generated worldwide in 2019 was still around 60 billion US dollars, live shopping is said to have been responsible for sales of around 158 billion US dollars in China alone one year later. Special events in particular, such as the ‘China Double Eleven’ shopping festival, are driving revenue even higher. On the day of the festival, Taobao reported revenue of 12.8 million euros from each of its 28 livestreams, while Alibaba even reported revenue of around 64 billion euros. In 2021, a profit of around 2.23 billion euros was generated in Germany through live shopping alone, which corresponds to an increase of five per cent compared to the previous year. The shopping channel QVC also seems to have recognised the potential of the strategy, as the channel is now also available as a live stream on YouTube.
China’s role as a live shopping pioneer
The concept of livestream shopping first became popular in the People’s Republic of China, which has the highest number of online shoppers in the world. Influencers or key opinion leaders (KOLs) usually appear in an app and describe, test or model a wide variety of products for their audience. The entertainment factor – known as ‘shoppertainment’ – also plays a major role here. 50 thousand broadcasts, 300 billion euros in generated sales – the figures clearly speak in favour of the relevance of live shopping as a distribution channel. Four out of five Chinese residents have already shopped via a live broadcast, and individual hosts have also streamed themselves to national celebrities. This applies, for example, to the young Chinese Li Jiaqi, who is often referred to as the ‘lipstick king’. The influencer and entrepreneur has managed to sell around 15,000 lipsticks within five minutes and makes over 140 million dollars in sales in a single day.
There are many reasons why livestream shopping has become a mass phenomenon in China. One of them is escapism, i.e. the flight from the real world and from the supposedly boring or unpleasant aspects of everyday life, which are blocked out when watching or interacting with livestream hosts. In addition, there are fears of counterfeit products or contaminated food, which the audience in turn avoids through the possibility of direct exchange and evaluation. The existing infrastructure, as demonstrated by super apps such as Alibaba or Taobao Live with their fully integrated shopping platforms, also speaks in favour of success.
However, the strategy is not only becoming increasingly popular thousands of kilometres away, but also in Germany. Around 36 per cent of selected brands from the fashion and beauty sector have already organised a livestream event. Nevertheless, there are still challenges that have prevented live shopping from becoming a widespread phenomenon in Germany. On the one hand, personalised customer advice is still weak in Germany. On the other hand, German providers are often still too static in their product presentation per se and overwhelm potential buyers with too much information about a particular product. Many brands also rely on their audience being satisfied with pre-produced and edited videos.
Examples of the successful use of live shopping
In the DACH region in particular, there are one or two aspects where communication experts can learn a thing or two from the pioneer China when it comes to the successful use of live stream shopping as a marketing strategy. Nevertheless, there are already positive examples in the immediate vicinity that should be emphasised. For example, prospective customers of the perfumery Douglas can find the link to current livestreams directly on the homepage. If potential customers follow the corresponding link, they are taken to a new landing page on which all streams are available for immediate access. This means that nothing stands in the way of exciting live shopping fun.
Figure 2: Positive example Douglas: On the provider’s homepage, customers can find the individual shopping live streams directly via the start page.
Other established brands that are already utilising the live shopping concept include Tchibo, hagebaumarkt, Lego, XXXLutz, Höffner and SportScheck. Mediamarkt also offers its audience around five to six broadcasts, while Lidl usually offers one live show per month. In the fashion industry, names such as Esprit, Otto, AboutYou and Walbusch are also among the companies that already use live stream shopping. The success story of the Karls brand from Rostock should also be emphasised in this context. While customers were initially only able to buy strawberries on the farm, the company has now opened numerous agriculturally themed experience villages. Since 2018, it has also had its own app, which provides followers of the brand with live shopping shows.
Interest, desire, action: live shopping in the marketing mix
From the point of view of communication experts, it can be said that live stream shopping is an excellent complement to traditional marketing measures. The primary goal behind the use of live shopping is the direct sale of the desired products via the online shop. However, it is often a vivid, convincing presentation and authentic interaction with your own audience that arouse interest and desire in the first place. Live stream shopping can also generate countless data for further communication measures. If customers also come into direct contact with a brand or a specific product via a live shopping event and are immediately convinced by the content on offer, the customer journey can be greatly shortened. In this case, the entire process from raising awareness and arousing interest through to finalising the purchase is much faster.
In addition, it is advisable to entertain and engage the audience during the individual livestreams as playfully as possible with further promotions. For example, the host can offer special giveaways or similar – but only within a certain period of time. As with traditional teleshopping, the provider can also emphasise the sense of urgency in live shopping through scarcity or limited availability. Such promotions prove to be particularly successful with higher viewer numbers, as the fear of being ‘excluded’ from a potentially good offer becomes even stronger and faster.
From Amazon to TikTok: choosing the optimal live shopping platform
The online mail order company Amazon, for example, is proving to be a pioneer when it comes to the use of live shopping formats. Interested parties can find various streams on the topics of fitness, nutrition, home and other categories on the platform. The corresponding products can also be purchased directly under the respective broadcast. To date, however, the live programmes on Amazon are not yet available in German. Those companies that have created shops on the social platforms Facebook or Instagram can also start a live stream for potential buyers directly in the apps of those media. The trending platform TikTok made headlines in December 2021 with two large-scale live shopping events, making a further foray into e-commerce.
Regardless of the platform selected, there are a few points of reference that marketing strategists can use as a guide for the successful use of livestream shopping. On the one hand, the content per se does not necessarily have to be perfectly designed or the text pre-written down to the last word. As long as the hosts – whether employees or media professionals – convey the content credibly and use live shopping regularly, they will win over their audience. Nevertheless, they should always ensure that they convey the most important content and facts to the point and that prospective customers do not feel bored by long speeches. The choice of distribution channel usually depends on the resources available. While smaller companies increasingly rely on the existing infrastructure of social media platforms, more established brands also score points with their own live shopping streams. To date, the strategy has also proven best for direct-to-consumer models that do not require intermediaries.
Strategy with untapped potential: Why live shopping?
Live stream shopping as a marketing tool can generate sales in the millions or even billions, regardless of the chosen platform, the associated industry or the products presented. On the one hand, viewers have the opportunity to interact directly with the host of the live stream, while on the other hand, at best, a purchase can be made directly during the live broadcast. Although there are already some examples of the successful use of live shopping in Germany, there appears to be even more untapped potential in the combination of teleshopping, online live streams and e-commerce platforms. With China as a live shopping pioneer in mind, it is therefore advisable for marketing experts in companies of all sizes not to ignore the concept in their strategic and operational decisions.
