Livestreaming e-commerce in China

Short description: New retail trends in China

Livestreaming e-commerce in China (also known as live commerce or livestream shopping; Chinese: 直播带货; pinyin: Zhíbō dàihuò) was initiated by fashion e-commerce platform Mogujie in 2016.[1] In the same year, it was picked up and gradually made popular by Alibaba, who turned live commerce into a fixture in its annual Singles' Day shopping festivals. [2]

## Contents

* 1 Market size in China
* 2 Chinese platforms for live commerce
* 3 Multi-channel networks in China
* 4 Regulatory interventions
* 5 References

## Market size in China

After a three-year development period between 2016 and 2018, China’s livestreaming e-commerce industry became popular in 2019. Today, it is a well-established ecosystem which in 2020 counted over 8,800 companies and 1.23 million live hosts, known in China as Key Opinion Leaders (KOLs), according to Shanghai-based new retail research firm iResearch.[3] In 2020, the top two KOL, Austin Li and Viya, alone, sold 9.1 Million RMB in Alibaba's Single's Day pre-sale. [4]

According to the 47th Statistical Report on China’s Internet Development, released in February 2021 by China Internet Network Information Center (CNNIC), the number of livestream e-commerce users was 388 million by 2020, accounting for roughly 40% of the Chinese internet population.[5]

The industry exceeded the one-trillion RMB threshold by the end of 2020, according to KPMG and AliResearch.[6] While the growth of the sector is diminishing year after year, China’s live commerce market is forecast to continue growing. From 31 March 2020 to 31 March 2021, GMV on Taobao Live was 6.7% of the total transaction volume for Alibaba’s online marketplaces in China.[7] In 2020, live commerce accounted for 10.6% of the country’s total online retail market. [8]

The livestreaming trend has particularly benefited sales of agricultural products through e-commerce, with streamers presenting live tastings.[9]

The rapid expansion of China's live streaming e-commerce industry has dramatically changed consumer buying behavior. The main reason is that the interactive nature of live streaming enhances consumer trust and engagement. At the same time, live e-commerce has promoted and influenced consumers' shopping willingness through vivid price attraction.[10]

## Chinese platforms for live commerce

The main Chinese platforms for live commerce are, according to Pandaily:[11]

* Taobao Live – the live streaming platform of Alibaba’s B2C platform Taobao, one of the earliest adopters of live e-commerce in China.[12]
* Kuaishou – a mobile app for short videos, particularly popular among the lower tier cities and rural areas.
* Douyin – the short-video platform owned by ByteDance and famous outside of China as TikTok.

## Multi-channel networks in China

Besides the livestream platforms, the growth of the industry is fueled by multi-channel networks (MCNs), companies who incubate live streamers, or KOLs, and connect them with brands and end-users. MCN plays two critical roles. On the one hand, MCNs are training live streamers and acting as a communication bridge between merchants and live streamers. Based on the merchant's product information, the MCN selects the suitable live streamers they have trained to prepare for live streaming sales to sell their products. In addition, the MCN will negotiate details with the merchant on behalf of the live streamer, such as deposits, commissions, and products to be sold.[13] Most MCNs have one leading KOL in the founding team or as the main source of revenue, and tend to work with one platform. Among the most famous MCNs in China are, according to TechNode: [14]

Main MCNs in China  MCNs | Headquarters | Key KOLs | Main platforms

|
|
|

Xinxuan Group | Guangzhou | Xin Youzhi (Xinba), top KOL, Founder and CEO | Kuaishou
Rhunn | Hangzhou | Eve Zhang (Zhang Dayi), top KOL, Co-Founder and Marketing Chief | Douyin, Taobao Live[15]
MeiONE | Shanghai | Austin Li (Li Jiaqi), top KOL | Taobao Live
Qianxun Group | Hangzhou | Viya (Huang Wei), top KOL | Taobao Live

## Regulatory interventions

In March 2021, the State Administration for Market Regulation introduced new rules targeting the development of the livestreaming e-commerce sector, giving platforms and merchants more responsibilities and addressing concerns linked to user data privacy and forced exclusivity.[16]

In April 2021, six Chinese government agencies including the Cyberspace Administration of China rolled out additional rules requiring providers to set up a system to maintain the safety of content, verify the identity of livestream hosts and to secure users' personal information.[17]

In August 2021, China’s Ministry of Commerce introduced new industry standards for livestream commerce, detailing how hosts should dress or speak during the live broadcasts, as well as setting guidelines for hosts and products reviews.[18]

## References

1. ↑ Sun, Henan. "Chinese fashion e-retailer Mogu banks on live streaming to revive fortunes". KrASIA. 31 August 2019. Retrieved on 14 December 2021.
2. ↑ Arora Arun, Glaser Daniel, Kim Aimee, Kluge Philipp, Kohli Sajal, and Sak Natalya. "It’s showtime! How live commerce is transforming the shopping experience". McKinsey & Company. 21 July 2021. Retrieved on 14 December 2021.
3. ↑ "2021 China’s Livestreaming e-Commerce Industry Report". iResearch. 22 September,2021. Retrieved on 14 December 2021.
4. ↑ PwC China. "The rise of live streaming e-commerce". https://www.pwccn.com/en/tmt/the-rise-of-live-streaming-e-commerce-feb2021.pdf.
5. ↑ "The 47th Statistical Report on China’s Internet Development".China Internet Network Information Center. February 2021. Retrieved on 14 December 2021.
6. ↑ "The 14th Five- Year Plan: Sector Impact Outlook". KPMG. February 2021. Retrieved on 14 December 2021.
7. ↑ Cheng, Evelyn. "Chinese livestreamers can rake in billions of dollars in hours. How long will it last?". CNBC. 15 November,2021. Retrieved on 14 December 2021.
8. ↑ "2021 China’s Livestreaming e-Commerce Industry Report". iResearch. 22 September,2021. Retrieved on 14 December 2021.
9. ↑ Liu, Lizhi (2024). From Click to Boom: The Political Economy of E-Commerce in China. Princeton University Press. pp. 160. doi:10.1515/9780691254111. ISBN 9780691254104.
10. ↑ Chen, Chunfeng; Zhang, Depeng (2023-01-01). "Understanding consumers' live-streaming shopping from a benefit–risk perspective". Journal of Services Marketing 37 (8): 973–988. doi:10.1108/JSM-04-2022-0143. ISSN 0887-6045. https://www.emerald.com/insight/content/doi/10.1108/jsm-04-2022-0143/full/html.
11. ↑ Junjie. "Top 3 E-commerce livestreaming platforms in China". Pandaily. 5 April 2020. Retrieved on 14 December 2021.
12. ↑ "Alibaba bets on live-stream e-commerce amid Big Tech scrutiny" (in en). 2021-04-28. https://www.scmp.com/tech/big-tech/article/3131447/alibabas-taobao-live-reports-over-us60-billion-gmv-2020-china.
13. ↑ Xue, Jin; Liu, Matthew Tingchi (2022-07-22). "Investigating the live streaming sales from the perspective of the ecosystem: the structures, processes and value flow" (in en). Asia Pacific Journal of Marketing and Logistics 35 (5): 1157–1186. doi:10.1108/APJML-11-2021-0822. ISSN 1355-5855. https://www.emerald.com/insight/content/doi/10.1108/APJML-11-2021-0822/full/html.
14. ↑ Vernotti, Claudia. "What can Europe learn from China’s live e-commerce boom?". TechNode. 4 November 2021. Retrieved on 14 December 2021.
15. ↑ Liao, Rita. "Ruhnn, a Chinese startup that makes influencers, raises $125M in U.S. IPO". TechCrunch. 4 April 2019. Retrieved on 14 December 2021.
16. ↑ Lee, Emma. "New e-commerce laws address livestreams, forced exclusivity". TechNode. 17 March 2021. Retrieved on 14 December 2021.
17. ↑ Chen, Celia. "Chinese regulators tighten grip on live-streaming e-commerce, intensifying scrutiny on tech". South China Morning Post. 24 April 2021. Retrieved on 14 December 2021.
18. ↑ He, Laura. "China now wants to tell influencers how to speak and dress when live-streaming". CNN Business. 19 August 2021. Retrieved on 14 December 2021.

0.00

(0 votes)

Original source: https://en.wikipedia.org/wiki/Livestreaming e-commerce in China. Read more

|

Retrieved from "https://handwiki.org/wiki/index.php?title=Livestreaming_e-commerce_in_China&oldid=3992388"