To Western ears, TV home shopping may be reminiscent of dull and dated products marketed to mostly elderly consumers. But in China live streaming e-commerce has now become the hottest post-Covid retail trend.

It attracts a young audience, and most successful hosts are brand and retail CEOs.

TV Home Shopping Reinvented

Live streaming is not new to China.  However, responding to the Covid-19 lockdowns, the popularity of livestreams has skyrocketed and grown far beyond selling the regular merchandise. The latest climax, for example, was the successful sale of a rocket launch.

(Source: Bloomberg)

And TV home shopping has gone CEO. On May 21, Alibaba’s Tmall announced more than 600 CEOs live streaming events, including many large Chinese as well as foreign brands in China. One of those events was hosted by Gree Electric Appliances chairwoman Dong Mingzhu, and her livestream event sales reached 6.54 billion yuan (USD 918 million).  Different from Dong’s previous online marketing, some 30,000 brick-and-mortar stores of Gree participated in the livestream.

Gree’s total sales during its livestream (Photo: Gree Electric Appliances on Sina Weibo)

The Principles of Live streaming E-Commerce & Branding

The growing live streaming trend in China is powered by social media and seamlessly merges brands, retail, e-commerce technologies, infotainment, real-time consumer interactions, brand ambassadors and influencers, as well as big data mining into the form of ‘zhi bo dai huo’, live streaming e-commerce.

L’Oreal livestreaming with KOLs on Tmall (Photo: L’Oreal)

Perhaps more importantly, live streaming e-commerce reflects the underlying fundamentals of brand building as a continuous process, i.e. the essence of building ‘new trust’ with ‘new efficiency’ through ‘new connectivity’.

New Trust

In today’s trust-deficient world marked by increasing social fragmentation, brands are seeking ways to enhance their narratives and to rebuild consumer trust. Live streaming e-commerce provides a platform to magnify brand narratives and maximise a brand’s personality. In many ways it attempts to merge product knowledge with brand narratives and company leadership to build a new trust relationship directly with consumers.

Brand owners and CEOs are no longer simply relegating brand ownership to their marketing departments or to social media influencers.  They are standing at the forefront of  building new brand trust. Some retailers are also retraining their physical store managers and staff to become live streaming e-commerce hosts to generate new sales.

Online Shopping in China continues to grow fast (Source: Statista)

New Efficiency

Brands and retailers are always seeking ways to reach new consumer segments, new markets, especially now during the lockdowns without expensive physical presence. Live streaming e-commerce offers a one-click model from brand awareness, product selection, real-time consumer feedback, instant purchase, online payment and contactless delivery to real-time big data analysis, all seamlessly.

Brands and retailers are forming various partnerships with different players in the e-commerce ecosystem: social media platforms like Tiktok/Douyin, Taobao, Kuaishou, with MCNs (Multichannel companies), and with private contents creators, and influencer incubators. To bypass the complex and often confusing Chinese live streaming middlemen,  some brands and retailers are also investing in setting up their own live streaming e-commerce teams and going directly to consumers.

The influence of influencers in China (Source: McKinsey Luxury Report 2019)

New connectivity

In the fast changing Chinese retailing and consumer market, the barriers of authoritative media, niche brands, consumer needs, and entertainment are constantly being broken and re-integrated. Increasingly, Chinese consumers are transitioning from an ‘advertising – brand – price’ to a ‘value – scene – credible personality’ approach.

Live streaming e-commerce platforms offer ‘what you see is what you get’,  intuitive, transparent, and as promised by company’s and brand’s leaders themselves. It also provides instant consumer feedback and opportunities for big data research. This effectively led to a shift from conversations between products and people to conversations from person to person, and quickly leads to face-to-face transactions.

Some retailers are even replacing costly flagship and experience stores with live streaming e-commerce events

Chinese consumers’ best friend: the mobile phone (Photo: Andrew Leu)

The 21st Century Version of TV Home Shopping is made in China

We don’t know the future of live streaming e-commerce yet. But it is likely that, not only in China, executives will have to show more digital presence if they want to truly lead their brand or retail business.

No need to outcompete social media celebrities, but if you want to attract smart consumers in the long run, you need to look confident in a livestream alongside your brand’s influencers. In a world where working from home becomes ever more important, post-covid leadership requires more than just being familiar with Zoom.

Steve Jobs demonstrated early on how a CEO’s strong digital presence contributes to brand building (Photo: Apple)

Whether you are considering live streaming e-commerce or other instruments, there are now many businesses that are relentlessly pursuing the new trust, new connectivity and new efficiency. Ignoring live streaming e-commerce will not perish your brand, but ignoring these fundamentals certainly will.

So, don’t  let this crisis goes to waste!

(Featured image credit: Alibaba Group on Youtube)

About the Author:

Yoon Wai Leong is a seasoned consumer goods and brand expert for China and South East Asia. Looking back on a rich career as a manager and consultant, he now focusses on coaching selected consumer goods companies to maintain their growth in post Covid-19 times. Read his articles here or connect with him on LinkedIn.