Live commerce, live shopping, live streaming, and live chat have become some of the trendiest sources of engagement in e-commerce. With COVID-19 changing the dynamics of the retail industries, people enjoyed the lavishness of shopping online. However, this wasn’t enough.
As the concept of online shopping matured, software vendors started becoming competitive in providing more to customers and developing software in line with the trend. This led to the birth of a new concept called live commerce. Let’s look at how the world's largest software marketplace has reacted to these trends to understand what live commerce is and why we created a category for Live Commerce Software.
Live commerce: The next wave of the e-commerce revolution
Live commerce provides a blend of entertainment with instant purchasing to consumers to ease their shopping experience and make it memorable. It also provides enormous scope for retailers, brands, and digital platforms to create value for themselves. Consumers are gradually moving away from the traditional form of buying to get a more personalized experience.
| Related: What is Social Commerce and Why We Created a New Category for It → |
What is Live Commerce?
In simple terms, live commerce is the fusion of live streams with the online purchase of products and services over a digital platform. It’s a modern form of e-commerce where a live video is hosted by a key opinion leader (KOL) or an influencer, usually chosen by the company, to introduce and demonstrate a product, and interact with the audience through chats to prompt sales.Live commerce enables customers to purchase products directly from the interactive video via a shoppable link linked to the brand’s e-commerce store or marketplace. Live videos give the customer a better understanding of the product, making the experience more personal and meaningful.
The history of live commerce began in China in 2016 with the Alibaba-owned online shopping platform Taobao. Their integrated live-stream video and e-commerce platform allowed visitors to watch live videos and shop in real time. In 2020, Alibaba’s Singles’ Day presales campaign on Taobao live generated record-breaking sales of $7.5 billion in the first 30 minutes of the live. Ever since, live commerce has been known to be a major channel for sales in the Chinese retail market and is expected to reach a whopping market size of 4.9 trillion yuan in 2023.
Why do brands vouch for live commerce software?
Live commerce and social commerce have opened a new horizon of unique selling opportunities for customers. While live commerce and social commerce are not mutually exclusive, both of these differ from each other in the way they help brands sell more effectively. While social commerce focuses primarily on selling through social networks, live streams can be done on social media platforms, the brand’s own e-commerce site/app, or marketplaces using live commerce software.
Live commerce software can help create value for users primarily in three ways:
Information and engagement: As per research conducted by Livestream with New York Magazine, 80% of people prefer live videos from a brand over reading through a blog, and 82% prefer live videos of brands over social media posts. This means live videos are the best way to create personalized engagement with customers and provide information about a product, which is otherwise difficult to communicate through a post or an advertisement. Live commerce software enables brands to schedule influencer streamings, tutorials, live events, and one-on-one sessions with the customers and address their pain points and queries related to products then and there.
Increased conversion rates: Live commerce has seen a means to convert an increasing audience to customers at the stream. The traffic to the product page also increases with traffic to the stream. As per a report by McKinsey, companies have reported 30% conversion through live commerce, which is ten times higher than traditional e-commerce. Another report claims that, from total live stream views, 70% tend to view a product page, twice the number from traditional e-commerce. Live product demonstrations, live customer testimonials, and FAQ sessions together help the audience gain trust and assurance and become customers.
Improve brand equity: Live commerce or live shopping is a great way to build brand equity. It creates a great emotional connection between the viewer and the brand. Live stream viewers get to interact with one another, see questions and comments in the chat about the brand and hear from the influencer, which humanizes the whole experience and builds trust. Brands also have the ability to track and measure how well their live stream has done and compare the viewer-to-conversion ratio. Brands can also use live-stream testimonials as product reviews on e-commerce websites and marketplaces.
Live commerce software on G2
G2’s Live Commerce category is at a very early stage of its inception and has 42 products under its roof. Reviewers also have some interesting thoughts to share about the products and how the live selling feature is crucial to them.
A reviewer of Commentsold said:
“This is so easy to use for Live Selling. I love the ease of use and the fact that CS takes care of all the invoicing. It's great that you can go live through so many platforms. Mobile App, Facebook, Instagram, and website.”
Another reviewer of Commentsold said:
“I have loved my experience so far with Comment Sold. It has definitely made live more manageable, I don't have to worry about sending invoices, and the ease of online selling and live selling is absolutely the best.”
A reviewer of Whisbi said:
“The best I like is the ability to interact with clients live on video. One2one sessions are a very nice way to show clients a product that is not near to them (e.g., a car).”
The Live Commerce category was launched in December 2022 and has garnered just 10 approved reviews till now. With the evolving market for live commerce, the category will also get a lot of traction from users and reviewers of the software.
The future of live commerce software
Live commerce as a technology is still evolving and is predicted to be a game changer for brands and retailers. While a country like China has rapidly evolved in the past five years, the US, with a market size of $17 billion, is slowly adjusting to this new concept. With the vast adoption of social media and live shopping among generation Z and millennials, more software vendors and users will penetrate the market. Overall, the Live Commerce Software category has great potential to cater to the upcoming trends in the e-commerce industry.
Edited by Jigmee Bhutia
Subhransu Sahu
Subhransu is a Senior Research Analyst at G2 concentrating on applications technology. Prior to joining G2, Subhransu has spent 2 years working in various domains of marketing like sales and market research. Having worked as a market research analyst at a renowned data analytics and consulting company based in the UK, he holds expertise in deriving market insights from consumer data, preparing insight reports, and client servicing in the consumer and technology domain. He has a deep inclination towards tech innovation and spends most of his time browsing through tech blogs and articles, wiki pages, and popular tech channels on youtube.
