Livestream Shopping: A Surge in the U.S. in 2021

With the significant impact of Covid-19 in fast-tracking online shopping growth, the emergence of new and enhanced social media apps, and the proven word-of-mouth power that comes from influencers, everyone’s constantly asking: what’s next in commerce? The answer: Livestreamed Shopping.

Social media influencers will bring livestreaming to the U.S., with the ability to host livestreamed shopping having already kicked into gear on Instagram, Facebook, TikTok, Amazon Live, Twitch, YouTube and Etsy. In 2020, according to Influence Central’s survey of 475 consumers, only 19% of people in the U.S. have tuned into a livestreamed shopping event. This presents a large pool of untapped audiences for brands and influencers to target. According to consumers, 60% found live-demos and product walk-throughs to be the biggest draw to livestreamed shopping, with a special deal only available during the live event being a powerful driving factor in their participation. Out of the consumers who had tried livestream shopping, 86% did so on Facebook, compared to 30% on Instagram, 22% on Amazon Live and 12% on YouTube. While Facebook leads the current faction of livestream shopping early adapters, all platforms still have a chance to get ahead of this new e-commerce trend, but they need to act now. 

Influencers can offer up livestreaming’s unique mix of entertainment, behind-the-scenes product information, answering viewer questions, and simple click-to-buy options. It is a chance for creators to interact directly with their followers and offers a compelling opportunity to both engage and shop with exclusivity. Due to the ongoing retail brick and mortar shut down of Covid-19, the ability to make shopping a social activity again, versus a solo experience, makes it the ideal time for brands and influencers alike to ramp up livestreamed shopping efforts.

RETAILERS NEED FOR RAPID EMBRACING OF NEW WAYS TO DRIVE E-COMMERCE

Forrester predicts that the U.S. retail sector can expect to see $321 billion in losses this year compared to last year’s gross sales. Livestreaming, also called Shop Streaming, enables retailers to leverage a consumer’s higher propensity to make a purchase when participating in real time, as it generates the instant gratification of a cool deal. The biggest draw for consumers comes from livestreaming’s unique mix of entertainment, behind-the-scenes product info, shared commenting with others, and simple click to buy options. Viewers can ask personalized questions about the product or service, or how to use it – something not possible with standard video sharing on Instagram or YouTube. The substantial shrink in U.S. brick-and-mortar stores will only supercharge e-commerce, and compelling online engagement by retail-streaming in a post-pandemic world. What might have taken a decade to build - consumers increasing trust of e-commerce - has been compressed into seven months. Given all this, retailers have enormous pressure to accelerate their diversified approach to e-commerce sales. Livestreams take place in real-time, normally on a smartphone, and are proving to be a highly effective way of marrying the offline shopping experience with online purchasing. Most importantly they create a powerful social aspect missing from in-store shopping. 

POWERFUL INTERNATIONAL SUCCESS PAVING THE WAY

Retail livestreaming has taken China by storm since the pandemic onset, with e-commerce sales expected to reach in excess of $135 billion by the end of 2020, with an accumulated audience of 524 million online livestreaming users. Livestreaming took off because online retailers like Taobao, Kaola (a unit of Alibaba) and JD.com had also built-up content communities. One stand-out livestreaming influencer, Viya, hosts a nightly livestream which blends entertainment, infomercial and group chat – drawing loyal audiences of up to 37 million. When Kim Kardashian went on Viya’s show, she sold 15,000 bottles of perfume in 15 minutes. Li Jiaqi, known as “Lipstick Brother”, regularly attracts several million viewers to his livestream, selling hundreds of thousands of dollars of products in a single session. Geng Shuai sold more than 1,600 cars in 2.5 hours, showing that livestreaming could successfully create sales of expensive goods, without the typical consumer research and test drives. More than 100,000 brands, including national American brands such as P&G, Ralph Lauren and Levi’s, engaged in livestreaming in China.

WHICH INDUSTRIES WILL GAIN TRACTION?

There has been early traction in fashion, beauty and cars, but expect this to expand broadly across lifestyle products in 2021.

For instance, Wayfair started using livestreaming for its annual “Way Day” event. With the runways closed, beauty brands have turned to livestreaming for new product launches mixed with advice. L’Oreal Group brands including Urban Decay and Lancôme, have been offering shoppable livestreams for their cosmetics. NYX Cosmetics hosted a livestream makeup tutorial and shopping experience in honor of Pride in May. In the food industry, Chipotle turned to live streaming with celebrity guests to keep young customers excited and entertained.

The opportunity is there for brands that want to be on the early adapter side of livestreaming in the U.S.