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September 1, 2020
[EIDETIC INSIGHT] Live Commerce, a potential cure to the retail industry’s COVID-19 plight.
With the pandemic still hot in the US, the retail industry has suffered as customers do not flock to areas like malls, outlets, or department stores as they observe social distancing and self-quarantine. In fact, within the first week of June, more than 2,100 stores closed across the US, and as many as 25,000 stores are expected to follow suit throughout the year. When comparing that with last year’s total store closings of 9,300, the impact of COVID19 is clear to see.
There may be hope, however, for the retail industry, and the answer lies in Live Commerce, a form of stream shopping that allows for customers to watch products be previewed, tried on, and tested on live stream, with one-click or other expedient forms of purchase enabling seamless transactions between seller and buyer.
China Leads Ecommerce
Does it work? Just ask China. In 2019, Chinese consumers outspent the US and UK in online purchases in 2017, and with an impressive $1.935 trillion in ecommerce sales recorded for 2019, there is some serious cash being spent online. While that is in no small part due to the smart strategies taken by ecommerce giants like Alibaba and Taobao, there’s no denying the incredible impact that live commerce has brought.
In one two hour live commerce streaming campaign, Maybelline sold more than 10,000 lipsticks, which is around $210,000 USD. On Single’s Day of last year, sales from Tmall’s live commerce service garnered sales of $2.9 billion, according to Alibaba Group.
There also does not appear to be any slowing down for the growth of ecommerce in China, as analysts predict this growth will last through 2023.
Where does it fit into US Retail?
So it’s successful overseas, how can it translate in the US? Well it’s already begun, just not at the scale China or APAC is running at.
Amazon launched Amazon Live in 2019, its own live commerce service, where hot items from the Amazon store are put on display and presented by creators. Dote also released Shopping Party, a feature that replicates the mall shopping trip on your smart phone, complete with influencers streaming trying on outfits and a chat box to interact with them.
The US is late to the game, but that doesn’t mean they can’t bounce back. With online shopping the only viable option for those trapped in quarantine or for those wishing to maintain social distancing, it is an excellent time for retailers to experiment with this highly successful formula.