Live shopping is expected to bring in $480 billion in China this year, according to to eMarketer, but only $11 billion in the United States, according to in prospective research. That could change quickly, though: Facebook, Amazon, TikTok, Twitter, and other tech giants like Pinterest are going all-in on live shopping.
What is the appeal of direct shopping?
It’s quite simple: streaming is entertainment, we are bored and we love to shop.
“Social media has become a bit like your entertainment hub,” influencer and entrepreneur Elma Beganovich told me on the Tech First Podcast. “People…get bored, fill time, take a break from work…flip through…their phone and scroll through Instagram feed…then suddenly you see in your feed someone ‘one is promoting something. So they might say, “Come to my Amazon channel”, right, “then watch me there”. live.”
Live social shopping is certainly important in the verticals you might imagine: fashion, beauty, fitness, home decor.
But it’s not just for women, says Beganovich.
Home improvement is also a major vertical for online shopping, and marketers are also targeting men for tech devices and fitness verticals.
The key, perhaps surprisingly, isn’t necessarily shopping. Rather, it is the entertainment, fun, interest, and engagement that an interesting and passionate influencer brings to a space. And if it is a product you are interested in and the product interests you, you can simply click on the buy button.
Just three years ago, this was almost non-existent in the West, and it was a small segment of commerce, just 3.5% of all retail e-commerce in China. Last year it was a $300 billion segment in China, accounting for just under 12% of retail sales, and in 2023 eMarketer estimates it will be 19.4% and d worth more than $600 billion. The corresponding figures in the United States are $11 billion this year and growth to $25 billion by 2023.
The question, of course, is whether live shopping is a pandemic flash-in-the-pan, much like Peloton, which would stoppage of production for two months to sell existing inventory.
It’s no surprise that live shopping took off when people couldn’t actually get to a real store, or scroll through social media during lockdowns, lockdowns and quarantines.
But will he have stamina?
It will be if big tech has anything to say about it.
Amazon is investing heavily in Amazon Live. Google offers live shopping on YouTube. Pinterest, apparently a great choice for this type of business, announced plans for live shopping late last year. Twitter, which has put innovation around creators and monetization into overdrive lately, is working on live shopping. Facebook is investing, especially on Instagram. TikTok, with roots in China, is a particularly interesting player to watch here.
Beganovich thinks it has legs.
“It’s so much more powerful when someone talks to you like we’ve seen with QVC,” she says. “I think there will be a lot of opportunities there and certainly tech companies are investing and will continue to invest in this space.”
She has an interesting perspective on the space, both as a participant and as a coach. With her sister Amra Beganovitch (economist), she launched a digital agency, Amra & Elma, which has clients including Uber, Olay, Wells Fargo, Netflix, P&G and L’Occitane. A lawyer by training and today the founder of a startup, Elma has more than 700,000 followers on Instagram, and Amra is not far behind.
As valuable as live shopping is from a consumer perspective, Beganovich says, it’s just as valuable from a brand perspective. And not just for sales.
It is also brand image. Time. Warning.
“You’ve now essentially opened up to a lot of consumers who otherwise wouldn’t have considered you or given you more than two seconds of their time,” she told me. “The type of customers…that are brought to these live streams…they’re willing to…give some of their time to you.”
And that, whether or not it results in a massive billion-dollar industry growth, can only be valuable.
To subscribe to TechFirst; obtain a transcript of our conversation.