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Trend Topic: Live Video Shopping

Trend Topic: Live Video Shopping

To the German article

Live video shopping is one of the latest trends in online retailing. In this blog post, you’ll learn why this sales strategy is so popular right now, where the trend originated, and for which industries it’s suitable. In addition, the experts from Dept will tell you how to approach the topic yourself and what’s essential in the process.

This blog post was created in collaboration with our enterprise partner Dept and is based on a webinar from June. Dept has helped numerous customers create live shopping shows on their own. The support includes everything from strategic consulting and conception to on-site shooting and activation of the target group. 

What is Live Video Shopping anyway?

Live Video Shopping is the combination of live video and ecommerce. Products are presented in a live stream, which viewers can buy directly and without much effort. The trend originated in Asia, especially in China. It is estimated that live shopping generated 134 billion euros in sales last year. That alone shows the potential. Now, Live Video Shopping has also reached Europe and has become one of the most discussed trends.

Various factors have driven this development: on the one hand, the general global ecommerce growth, and on the other hand, the dynamic increase in video traffic, which has also increased the share of live video traffic. Germany’s upcoming nationwide 5G rollout gives the video and live video formats an additional boost.

The Covid-19 pandemic has helped Live Video Shopping become a trend

Indeed, the Covid-19 pandemic is also a crucial factor in the popularity the trend has recently enjoyed. The reason being people couldn’t go to stores for long periods to get advice. Live Shopping can serve as a substitute to a certain extent. The viewer feels well informed and gains a deeper insight into the product. The presentation through a salesperson is also a significant added value in on-site consultations. And even better: While a quick talk in the store is usually short-lived, Live Video Shopping hosts have the opportunity to add their personal touch and charisma. With video streaming, brands have the chance to inspire and excite their customers on a whole new level.

 

Interactive features: Questions and reactions are directly visible to everyone in the chat

live-video-shopping-860

The screenshot illustrates a typical scene from Live Video Shopping. You can see someone presenting the products (in this case fashion pieces). There is also a chat where users can ask questions and show their reactions. This has the advantage that the promoters can react directly and answer questions.

For which industries is Live Video Shopping suitable?

Video Live Shopping is suitable for all industries - whether B2C or B2B, no matter whether a brand or a retailer. Retailers from the fashion, lifestyle, and beauty industries were the first to use it. But the trending topic is also predestined for the furniture, food & beverage, FMCG (fast-moving consumer goods), and pharmacy sectors. In general, Live Video Shopping makes sense for all products that can be easily demonstrated, shown, and explained in front of a camera.

These formats are available for Live Video Shopping

The most common form of Live Video Shopping is the one-to-many format. Here, a brand tries to reach as many viewers as possible via one or more platforms and streams.

This contrasts with the one-on-one format, mainly used in the luxury segment and for huge shopping carts or complex products that require in-detail explanation. Customers book an appointment and receive, e.g., a one-on-one consultation via a live video stream. The luxury brand Gucci, for example, focuses on the one-on-one concept: Via the “Gucci 9” service center, the brand offers an appointment to be able to provide its customers a particularly exclusive consulting service, including a store experience.

Another option is the one-to-group format. Here, tickets are sold or allocated to selected customers for a low commitment price in advance of an exclusive shopping event. At the scheduled time, this exclusive group can, e.g., purchase certain products before everyone else.

Which channels are best suited for Live Video Shopping?

In Asia, the topic is usually approached on a platform basis. Live Shopping often occurs via ecommerce retailers such as Alibaba, Taobao, T-Mall, etc.

For Europe and the USA, Dept sees the issue of direct integration into the store. This, of course, gives the retailer complete data sovereignty over the event, which wouldn’t be the case with streams via platforms such as Amazon. This is why it makes more sense for many online retailers to map the trendy topic via their store.

Offering Video Live Shopping

Are you wondering what the setting might look like if you wanted to integrate live video shopping into your online store? There are no limits to your ideas. As always, it is essential that whatever you plan fits your brand. But of course, it also depends on the show concept and your goal.

If you want to implement the whole thing as and quickly as possible, you can use stores, showrooms, or premises that may even still be unused due to lockdown restrictions. Stores represent an already branded environment and offer corresponding areas for product presentation. However, this could also come across as boring and monotonous to viewers. “We recommend our customers to be more courageous here, to rent thematically suitable locations, to go outside, etc. - to show the products properly in use,” says Gesine Meitler, Business Development Director at Dept.

How can Video Live Shopping be intelligently linked to the ecommerce platform?

It’s possible to integrate a tool directly into the store. In this case, the stream can be combined on a landing page via I-Frame and hosted via the servers of the tooling partner.

In this case, everything takes place on the landing page. Using the Live Shopping interface in the stream, viewers can add products directly to a shopping cart, which is then forwarded to the online store during the checkout process.

This is also the advantage over Instagram live streams, which are also offered more frequently. Products can be placed as links under the stream, but as soon as the customer clicks on them, they leave the stream and experiences a break in the customer journey. This doesn’t happen if a live shopping tool is used, where the shopping cart is included in the stream via an overlay.

Tips for measuring success

Depending on the objective, different KPIs should be measured, from conversion rate to the number of viewers to watch time. It’s important to know whether there is a stronger focus on sales or branding with the show. This should also affect the show concept, and the relevant KPIs should be measured accordingly. If the focus is more on selling, the conversion rate is relevant, as is the ROI of the show. If, on the other hand, the focus is on branding and education about the brand, then less revenue per show is also okay if the viewers are kept in the show longer. In this case, watch time would be relevant because it shows how long the user interacts with the brand. With an average of 8 to 12 minutes, Live Shopping is ahead of social and online stores.

How long is the planning process?

The process can move relatively quickly. The experts at Dept recommend planning 4 to 5 weeks for the setup phase since the tool must be integrated into the store, the internal processes have to be set up, and much more. In some cases, however, everything could be implemented within 1.5 or 2.5 weeks, including on-site planning, development of the show concept, and everything that goes with it.

Conclusion

Live Video Shopping is an exciting, future-oriented ecommerce service with solid growth potential and great opportunities at a manageable risk for brands and retailers. In the future, Live Video Shopping will be indispensable as a brand-building component and conversion funnel. Further dynamic global growth in the ecommerce sector and video traffic and new (live) video experience-supporting technologies such as 5G will meet users who will finally be buying digitally first in just a few years. China continues to set the pace in this development.

In the absence of large platforms in the German and European ecosystem, brands and retailers still have the opportunity to create an inspiring D2C experience for their users. The customer journey and the generated data are 100% owned in this case. This is a side effect that shouldn’t be underestimated. The currently still large window of opportunity will become smaller as time goes on. The first-mover opportunity compared to the perceived risks and uncertainties, on the other hand, is excellent. Courageous action and moving forward can be rewarded by excellent customer feedback, increasing view numbers, and remarkable conversions.

Want to see some example brands that have already gone live? Then check out the webinar recording with Dept. The presentation of the brands starts at minute 23:00.

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