Live Commerce: Meaning & Definition
Companies are leveraging social media platforms for more than just establishing brand awareness and presence. In recent years, live commerce has emerged as a winning retail strategy, capturing generations of shoppers.
Blending shopping with entertainment, brands are increasingly using live commerce to gain customer confidence and drive sales. But what is live commerce all about? How does it work and what advantages does it offer? We answer your questions in this article.
What Is Live Commerce?
Live commerce, also known as live stream eCommerce, is a type of eCommerce that uses live streaming video content to showcase and sell products online.
It is a relatively new concept that has gained popularity in recent years, particularly in Asia, but is now being adopted by businesses worldwide. Typical live commerce platforms include Facebook, Youtube, Tiktok, and Bilibili. Some companies may also develop their own apps or use their websites for product live streams.
During a live stream, a host or an influencer introduces the products, demonstrates their features and benefits, and answers any questions that viewers may have.
Viewers can engage with the influencers in real time. They may ask questions through comments and offer feedback through polls. They can also make direct purchases on the live stream platform, often with exclusive discounts and promotions.
Live commerce generally necessitates a partnership between brands and influencers. They may get a fee for presenting and marketing a brand’s products, which they may conduct through live streams on the brands’ social media account or their own. In the latter case, influencers come with significant fan following which is highly engaged and ready to buy. They leverage their existing audience base to increase sales.
How Does Live Commerce Work?
Live commerce allows businesses to connect with their customers in real-time and demonstrate their products in an engaging and interactive way.
For live commerce to work well, it must follow a structure that builds trust and compels audiences to spend their money. The framework of live commerce is as follows:
- Live streaming: A host, generally reputed as a credible authority, hosts a live broadcast on a social media platform.
- Product presentation: This is the heart of live commerce, where the host demonstrates live how a product or service works. They detail the features and pricing. They may also share their personal experience using a product and share recommendations. All such actions lend credibility to their live streams.
- Interactive shopping: Live commerce is built on the idea of real-time interaction between seller and customer. Live streaming platforms enable customers to send their inquiries via comments, and get replies quickly. They may also hear answers to other prospective buyers’ questions, thus learning about the product in detail. They may share their feedback as well.
- Direct Purchase: Live streaming platforms come integrated with shopping features. While watching a live stream, customers can add products to their carts and carry out the transaction without being prompted to leave and shop on a third-party platform.
- Deals and offers: To build customer engagement, hosts may offer deals and limited-time discounts as they conduct their live stream. This encourages their followers to make purchases during the broadcast without taking extra time to decide.
- Customer support: In addition to marketing for a brand, hosts also provide help to customers in aspects like product delivery and tracking.
Benefits of Live Commerce
Live commerce is growing in popularity, thanks to its many benefits. These include:
- Real-time interaction: Live-streaming a product enables customers to see things in action. They can also pose questions to hosts and receive real-time responses. The interactive aspect boosts both engagement and sales.
- Boosts sales: A popular, often relatable, influencer heads livestreams and collects fan bases of active buyers, who may impulse buy as they watch other people purchase items online. This accelerates sales.
- Customer loyalty: Customers connect with influencers detailing products for them on screen. This builds customer confidence in the brand and generates feelings of trust, thus driving loyalty.
Live Commerce: Key Takeaways
- Live commerce is a digital retail concept which fuses social media with online shopping.
- It makes use of the live steaming function, offered by existing social media apps, to allow customers real-time shopping experience.
- Generally, a known influencer acts as the host of a livestream. Their role is to demonstrate the product, answer people’s questions, and motivate them to buy.
- Live commerce hosts often incentivize buying by offering limited-time deals during their broadcast.
- Customers can purchase items within the live commerce platform that integrates eCommerce functions.
- Through live commerce, customers engage directly with sellers and learn about products actively. The real-time engagement is entertaining for customers. It also builds trust and drives sales.