Live Commerce: How Streaming Is Transforming Shopping

Woman giving makeup demo over a live stream as a way to market and sell products.

The Evolving Retail Industry

Brick-and-mortar stores have been shutting their doors at an unprecedented rate. Thanks to the COVID-19 pandemic and shifting buyer habits, more than 15,500 retail locations closed down for good in 2020 — with another 80,000 projected to close by 2026.

Live Stream Shopping: Trending Technology or Future Standard?

Just as online shopping transformed retail twenty years ago, live commerce promises to revolutionize how goods are purchased and sold today. This convergence of video and retail helps improve engagement, close the gap between customers and products, drive sales, and — in cases where bidding is involved — increase the average sales price.

Live Commerce in China

To understand live commerce, the first place to look is China — where it’s projected to grow into $770.70 billion market by 2023. Shoppable video was alive and well in China before the pandemic, but COVID-19 brought with it a live commerce boom that shows no signs of stopping.

Changing Dynamics Across Every Industry

Jewelry, fashion, accessories, and skincare all dominate Taobao and JD Live. But since the pandemic hit, traditionally offline industries such as home appliances and cars have also found traction within the apps. Even rural farmers are embracing live streaming to promote goods ranging from rice to fresh fish.

Live Commerce in the U.S.

Western entrepreneurs have been slow to capitalize on the fusion of tech and retail that we now call live commerce. TV shopping programs like the Home Shopping Network, QVC, and Jewelry Television (JTV) were among the first to bring live video-based shopping online — but early applications didn’t take full advantage of interactivity video technologies.

And Then, COVID-19 Hit

Just as the pandemic accelerated digital transformation across industries, it forced consumers to evolve their habits and embrace remote models. As a result, live commerce finally took off.

Types of Live Commerce

Here’s a look at some of the most common formats for live shoppable media today.

Online Marketplaces

Online marketplaces ranging from Alibaba to eBay have been around for some time, empowering users to buy and sell products without ever leaving their homes. Video technology is helping to revive this model and deliver the closest possible experience to ‘being there’ for those tuning in from their living room. Plus, real-time interactivity replicates the urgency of a real marketplace, prompting immediate action and enhanced community participation.

Live Auctions

Live video streaming is also bringing 18th-century auction houses like Sotheby’s and Christie’s into the 2020s. By enriching their digital presence, these organizations are connecting bidders worldwide with the excitement of the saleroom. Live streaming opens up the bidding pool to those unable to physically attend, reaching participants with varying interests and ensuring that each item sells at its proper valuation.

Source: Whatnot

Influencer Streaming

With an already captive audience, online influencers can use their personal brand and the power of live streaming to promote their favorite products in an interactive format. Also called key opinion leaders (KOL), influencers are key to Taobao Live’s success. In the U.S., celebrities like Kim Kardashian also have piggy-backed on this phenomenon.

Tutorials

Tutorials are the bread and butter of the cosmetic industry, where Ulta Beauty is driving live commerce innovation. With Beauty School Live, Ulta broadcasts virtual masterclasses on makeup trends and application techniques. Additionally, the brand hosts live streams on Supergreat, a beauty app that connects its Gen Z userbase with influencers sharing skin routines, application techniques, and product reviews.

Source: Ulta

Live Events

There’s plenty of overlap between live events and the categories described above. Still, newsworthy events such as product launches, limited edition drops, and retail holidays like Singles Day or Black Friday lend incredibly well to shoppable live broadcasts.

What’s Next for Live Commerce

Brick-and-mortar retail was clinging to an outdated model before the pandemic. But this doesn’t mean that retailers should abandon every aspect of the in-person experience.

Gamification and Interactivity

When live commerce is done correctly, gamification and real-time interactivity help drive consumer interest. Immersive 3D experiences using virtual reality (VR) also better engage remote users — allowing buyers to study the clothing from every angle and experience the excitement of being in the crowd of a runway show.

Blockchain, NFTs, and Crypto

Cryptocurrency and non-fungible tokens (NFTs) will likely play a role in future e-commerce monetization models. And the retail sector is already making moves to embrace this technology. Nike, for instance, recently acquired the NFT and virtual shoe company RTFKT to prepare for the trending metaverse.

Moving Live Commerce Forward

While the technologies discussed above pave the way to endless possibilities, innovation in live commerce doesn’t require getting too fancy.

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Wowza

Wowza powers scalable, reliable video for businesses looking to transform their product offering. https://www.wowza.com/