Live shopping comes as the latest commerce trend to combine technological advances and social media channels with the familiar, quaintly nostalgic concept of at-home shopping. Think the Home Shopping Network (which continues to thrive) but streamable on mobile phones through websites and on apps like Instagram with influencers and celebrities helping to sell goods.
According to Coresight, live shopping generated $60 billion in global sales in 2019 with U.S. sales accounting for $1 billion of that slice. Chinese buyers have long supported social commerce with a projected sales increase this year to $242 billion dollars, likely to reach half a trillion dollars by 2023. They have supported social commerce through apps and websites like TaoBao Live but it seems the rest of the world is beginning to catch up because COVID-19 accelerated live shopping’s appeal to at-home buyers. In a world under lockdown, live shopping is an experience that most closely resembles in-person shopping. Buyers can watch people in real-time try on products and comment, allowing the brand to get feedback instantly. There’s often a human element, like a well-known influencer or personality who acts like a glamorous version of a buyer’s favorite customer support staff. Consider Viya, a popular live streamer from China: She had a conversation with Kim Kardashian West just before Singles Day, which empowered the influencer mogul to sell 150,000 bottles of perfume in seconds.
What is old is new again: This type of social commerce is gaining traction among buyers hungry for new, fast experiences. This piece breaks down what live shopping is, including its origins as HSN and QVC (both now under the same ownership); the platforms for live shopping; and how influencers and well-known personalities are crucial to its success.
What is live shopping?
To understand the current iteration of live shopping, one must go back a few decades. In the late 70s and early to mid-80s, live shopping networks like QVC (Quality Value Convenience) and the Home Shopping Channel began to appear on televisions, first across North America and then worldwide. In Canada, there’s The Shopping Channel, and there were regionalized versions of QVC in France and Japan, to name a few. These free-to-air channels specialized in selling home goods, fashion, and beauty. Sears was the first to sign a two-year contract with QVC when it launched in 1986. The channels had their cornerstone hosts and, when celebrity-backed products began to circulate in the market, influential figures would appear on these channels to pitch directly to consumers. The primary audience for this avenue of shopping was, of course, women. By and large, before the working woman boom of the 80s, women still remained in or around the home. Here, the idea goes, the buyer of the household could call in and purchase goods herself, products for the family, and perhaps even a treat (jewelry often made the rounds), all from the comfort of her couch.
Of course, painfully stereotyped gendered buying habits aside, live shopping provided a convenience that has now been eclipsed by ecommerce and the ability to do it all from one’s computer or mobile phone instead. QVC and HSN are live shopping brands that exist now, routinely bringing on middle- to top-tier brands and celebrities to sell products. The original format for shopping at home in QVC and HSN has had to adapt to this new world of where and how to buy products.
Live shopping, or live stream shopping, has digitized the home shopping experience via social media, apps, and websites. Live shopping provides a real-time feedback loop for buyers, including reviews and recommendations of products. Influencers and buyers sharing among followers and friends, and asking questions about the product on the platform of choice is a crucial aspect for brands to embrace “social commerce.”
The way we know live shopping today is a fairly recent development. ShopShops, for example, was launched in 2015 by founder Liyia Wu, who established the company as a directory of sorts for American retailers to reach Chinese travelers. This means of buying has grown to be an enormously lucrative endeavor. It is an over $60 billion dollar industry that is likely going to grow. For example, NTWRK, which is a mobile app that uses live shows to sell limited edition products, such as sneakers, have seen their sales surge by 400%. Some shows reached $1 million in sales in approximately 10 minutes.
COVID-19 accelerated the adoption of live shopping, giving ample space and opportunity for it to reach North American and European buyers. Since ShopShops’ founding, Wu has expanded the enterprise for American buyers, kicking it off on Instagram Live, one of many platforms to live shop on, with Rebecca Minkoff. The American it-bag designer is no stranger to technological advances in fashion ecommerce, having embraced 3D tech early on. Unlike AR/VR, live shopping doesn’t use technology too seriously to figure out if a product will work or not in your space or on your body. As Minkoff told WWD, this opportunity with ShopShops essentially saved her brand. “We know the future of shopping is going to be video. But how do you make it interactive? Because there are a lot of platforms out there that are great. But [Liyia] makes it turnkey. And to be able to be the ShopShops launch partner for the U.S. was kind of an easy ask,” Minkoff told the publication.
Rebecca Minkoff wasn’t the first brand to experiment with live shopping. Fashion and beauty are the clearest, easiest examples of industries that will thrive in a live shopping environment: Brands in these two industries take advantage of live shopping’s ability to offer a visual of their products and showcase how well-designed they are, and invite their customers to give them product feedback.
For example, Sassy Jones hosts a weekly Facebook Live event called the Sparkle Party, a styling event that inspires buyers to incorporate bold statement jewelry pieces into their everyday outfits, and, recently, the brand joined the HSN, merging the two worlds of live shopping together. Cruelty-free makeup and skincare brand Jennifer Bradley also uses Facebook Live to engage with her community, talking about her personal life while trying on products in such a way that seems almost like a couple of friends chatting.
Beyond fashion and beauty, live shopping can be extended into many different types of categories. Consider a small, Northern village in China where farmers sold their produce on a live stream shopping event that gained the attention of President Xi Jinping.
Government interest in live shopping aside, it’s an avenue for many different categories, industries and brands to find and reach their buyers. All they need to know is which platforms and apps their buyers are using.
Live stream shopping platforms
With QVC and HSN, it was easy to know where your buyers came from: in their living room in front of the television set. Now, live shopping can happen on a buyer’s phone or computer, and, yes, streamed on their smart television, too.
In China, where live shopping is the most prevalent, there are a few places to go to participate. There’s TaoBao Live, which saw a profit of $6 billion on Singles Day in November, a 100% increase from last year’s sales amount. TaoBao Live saw 300 million viewers from Nov. 1–11 with 33 streaming channels available. Singles Day is a loose equivalent to Black Friday and Cyber Monday in terms of major profit for brands.
There are a number of tech start-ups that live stream themselves, but brands can also choose to use an existing live streaming platform:
But the biggest, and likely most impactful, way to capture buyers is through Instagram.
Instagram Live Shopping is now available for American-based brands and creators who have business accounts and checkout capabilities. Instagram Live Shopping is used to engage shoppers in a few ways:
Buyers want the experience to go along with whatever they purchase; they want to engage. It feels more important to do this now with COVID-19 limitations, and the collective trauma of being removed from people for so long, but live shopping is still likely to exist beyond whatever normal commerce settles back into. Globally, this is an opportunity for customers to continue to live this sort of borderless buying experience while still getting to be around people, albeit digitally.
One popular reason to include live shopping on platforms like Instagram for a brand is because of the reach and accessibility for the buyer. From February to March this past year, Instagram Live views jumped by 70%. Like television-based shopping networks, reaching your consumer where they are is going to lead to conversion, profits, and, hopefully, customer loyalty. Shoppers are on their phones or computers, browsing apps instead of websites, Instagram, and TikTok instead of going to a physical retail store.
Despite the limitations that COVID-19 has wrought on retail businesses, ecommerce sales were on the move upward anyway, and live shopping continued to play a vital role in how the future of buying would look. Now, with the future more or less here, platforms and companies are partnering with brands and influencers to make this mainstream.
Influencers are crucial to the success of live shopping
The face of a live shopping event matters greatly to a buying audience. Much like celebrity endorsement deals in the 80s and 90s, a publicly associated figure is key for developing trust and loyalty with buyers. Today, those key figures are influencers. The average-person-is-a-star influencer role is an enormous industry (think $15 plus billion by 2022.) Influencers have to, like any other entertainer, perform for their audience. Chinese influencer Meng Hu told CNN that her “throat gets really hoarse. [In this job,] you need to talk a lot because your mood is contagious. You can’t just do things halfway. Only when you talk enthusiastically can you get your audience excited.” Buyers get excited by people they believe could be their friends or who they aspire to be, and influencer marketing has really opened up that avenue for brands to reach and find new customers.
Layla Amjadi, Instagram’s product lead for shopping, told The Verge,
“Live shopping is this really fantastic one-two punch of discovery and consideration in one-go, and it naturally is a medium that lends itself to entertainment, so shopping as entertainment.”
Part of the reason Chinese consumers bought into live shopping early on is because of the role key opinion leaders (KOLs) played. In China, buyers pay close attention to influencers who are known as these KOLs. Viya profited enormously from and amplified the world of live shopping, helping usher it into the future of buying.
Buyers want product recommendations from people they trust and it has become easier to trust a full, complex human on Instagram who looks like they could be part of your own social circle. The role influencer marketing plays for a product doesn’t seem to be going away anytime soon, despite the hit the industry took during COVID-19 lockdowns and will be a big part of the live shopping experience.
Once more influencers begin to sell their own products, a trend that is likely to continue as they become budding entrepreneurs, we can expect for them to turn to live shopping on apps or affiliate websites to get a direct financial return.
Live shopping in 2021
Live shopping provides a necessary dose of human connection in a buying interaction that can feel a little human-less. Ecommerce shopping is fast and convenient but the solution for human interaction or an experience for online shopping is something brands have long wanted to include but haven’t been able to quite figure out.
Though a post-COVID life is on the horizon, and whatever semblance of normal living is sure to resume thereafter, live shopping—like many other new or adapted consumer behaviors and technologies—is going to remain a crucial pillar of the buying experience.