Online is becoming a main vehicle for purchases, and forward thinking businesses are already finding ways to seamlessly integrate their in-store and virtual experiences. In today’s world brands need to be omnipresent, having digital footprints across several channels. It’s the only way to reel in younger generations whose buying power will only increase. A recent study found that 68% of Gen Z shoppers planned to use non-traditional channels for Black Friday and Christmas shopping, with Instagram (47%) taking the lead as a holiday shopping platform.
Social media has been an incredible driver for ecommerce growth, and platforms are leaning in, creating new features to facilitate not just purchases but an online experience. Most social networks offer in-app shopping solutions now, including live video to meet shoppers’ demands. Livestream shopping has taken off in China, with the market growing at a compound annual growth rate (CAGR) of more than 280% between 2017 and 2020 to reach an estimated $171 billion in 2020.
So why are so many people opting for livestream shopping? Half prefer new social buying channels and livestream because they combine entertainment and shopping in the same way traditional malls do. Similarly, 46% of Americans think they are better because they can interact and socialize with their friends more easily while shopping.
Livestream shopping is causing retailers and social media companies to rethink their digital-shopping strategies, and several businesses are first in line to facilitate consumers’ livestream shopping sprees.
Retailers Going Live
The store of the future is moving toward more tailored, curated experiences. Every retailer is trying to understand the customer. As a result, more brands are leveraging livestream shopping to listen to and engage with their customers. Viewers can instantly purchase the featured product and participate through a chat function or reaction buttons. With innovative shopping formats and experiences, live commerce can also help brands strengthen their relationships with existing customers while attracting new ones.
Nike is a prime example of a brand that is leading the retail pack. Nike’s digital Live stores are tailored to be “locally relevant,” based on shopping patterns and app usage in a geographic area, whether that’s Long Beach, Calif. or Williamsburg, Brooklyn. Nike’s direct connection to consumers is paying off. Its direct-to-consumer online sales from Nike.com grew more than 50% year-over-year in fiscal Q4 compared with the prior quarter. Ecommerce now represents 21% of Nike’s total direct-to-consumer revenue, with 40% of that coming from its mobile apps.
In early November 2021, luxury retailer Saks announced its holiday schedule for Saks Live, a virtual events platform on saks.com offering a series of virtual events centered around gift-giving and dressing for holiday celebrations. Additionally, QVC and HSN kicked off the holidays with “Shop With Us Live,” a livestream cross-platform shopping extravaganza November 6-7, 2021 that featured more than 200 unique hours of live video shopping.
Redefining Social Shopping
Through 2021, nearly all the major U.S. social networks have expanded their services and introduced new livestreaming opportunities, many of which are aimed at boosting commerce on the platforms. For example, YouTube announced plans to host a week-long live shopping event, “YouTube Holiday Stream and Shop.” Viewers could shop for new products, unlock limited-time offers and engage with creators and other viewers via Q&A’s and polls.
This is an initiative that goes hand in hand with their findings. In a recent survey they found that 75% of viewers actually used YouTube for shopping inspiration. And not only that: 85% of viewers were found to trust creators’ recommendations, and even more specifically, viewers valued information quality and quantity over the production value of the videos.
The traditional TV medium is becoming more social, and customers are loving it. YouTube isn’t the only platform looking to bring customers closer to products. Pinterest recently introduced Pinterest TV, a series of live shoppable episodes featuring content creators. Each Friday, the social media platform will facilitate exclusive live product drops.
Finally, Meta, formerly Facebook, recently announced the launch of new shopping features: Shops in Groups, product recommendations and a test of Live Shopping for Creators. Shops in Groups enables admins of Facebook groups to set up an online store on their associated Facebook Page. During the summer of 2020, Founder and CEO Mark Zuckerberg announced that the company would not take a cut from the earnings of businesses and creators until 2023.
Retailers must develop a cohesive omnichannel strategy that provides shoppers with an unforgettable buying experience no matter what channel they are purchasing through, including live shopping.
Retail ecommerce sales worldwide reached more than $4 trillion USD in 2020 and are expected to top $6 trillion USD by 2024. For retailers, benefits of livestream shopping include reduced consideration period, increased customer engagement and higher sales.
There’s no one-size-fits-all strategy as it must be determined by your customer base. However, it’s clear that developing a compelling shopping experience is an essential part of every retailer’s strategy.
Zarnaz Arlia is CMO at Emplifi. She is a global marketing executive with a demonstrated history of driving growth and profitability in B2B marketing environments, responsible for driving all marketing functions at Emplifi, from vision and strategy to execution. She has a strong track record of building global businesses and bringing new products to market with the ability to link business strategies to customer adoption. Prior to her current role, Arlia held senior marketing leadership roles at Sitecore, Adobe, Trifacta and Neustar.