While video driven e-commerce was first piloted in China as early as 2016, live streaming sessions only recently have taken off as a powerful method to promote sales through cross border e-commerce. The tie-in of leading social media platforms such as Douyin, WeChat, Weibo and Little Red Book cross promoting live streaming and short video segments to promote product sales has ushered in a new era for brand building and selling foreign products in China. During last year’s Double 12 Festival (December 12), Douyin short videos drove over 200 Billion RMB in sales for Taobao.

Live streaming is a much more involved and interactive process than simple short video uploads on social media platforms. Professional presenters(hosts) introduce and demonstrate products- either brand focused or multiple branded items. The viewers can ask questions about color, fit, features, product material, and engage the host with follow on questions and request real- time product usage tips. Live streaming hosts will try and discuss 4-5 products over a 40-60-minute period. In a sense, live streaming is a bit like a souped-up version of QVC or Home Shopping. The interactive nature of live streaming develops a much stronger sense of trust with viewers, which is key to selling more complex products or introducing foreign brands.

Live streaming is rapidly becoming an accepted way of promoting services and products over the internet, with an annual growth rate of nearly 20% in 2018. A report by Imedia Research published last year estimated that more than 460 million people are using live streaming services in China. Revenue through live streaming was estimated at 15 billion RMB ($2 billion) last year and headed toward 200 billion by 2020. Live streaming users are also widely dispersed geographically across China. Surprisingly less than 15% are in Tier 1 cities with more than 33% in Tier 2 cities and 50%+ from Tier 3 cities in China. Thus, live streaming holds great promise to expand the current cross border consumer base dramatically throughout China.

Today’s cross border e-commerce growth is slowing and just onboarding a new brand is not enough* as the leading platforms (Tao Bao, Tmall, JD.com, and Kaola.com) in China are getting crowded and bidding prices for key word and online advertisements are getting more and more expensive. The next phase of e-commerce will focus on customers who are not yet active on the big platforms- more than 750 million consumers in China! The good news is online shopping via live streaming videos is quickly gaining popularity among the essential post-80’s and post-90’s generation consumers, who have increasing demands for premium brands and high-quality imported products. Furthermore, the post- 2000 generation tend to prefer buying fashion brands, beauty and make up products with strong repurchasing rates.

If you are not convinced how powerful this segment of potential online might be, go find a copy of August 30th, 2019 the Wall Street Journal. The lead article in Friday’s WSJ highlights how young Chinese spending habits rival their American counterparts and that is helping to usher in a new Chinese economy fueled by domestic consumption. Leading cross border experts note while Chinese e-retailing growth has dramatically cooled, live streaming is lifting sales in the China’s e-commerce sector. So foreign brand holders hoping to expand their sales in China via cross border e-commerce will need to actively embrace live stream as a key component of their brand development.

ABC Showcase USA is announcing a new brand development program for cross border e-commerce. Beginning on September 6th, ABC Showcase will be providing qualified companies a turn- key program to:

1. Onboard products onto the leading cross border e-commerce platform in China
2. Manage all aspects of the cross border e-commerce sale including: China Customs registration, upload product image and translation on Showcase USA storefront, pick, pack and ship products directly to the Chinese consumer (from Los Angeles warehouse), manage customer service and returns and payment
3. Promote selected products on either a one-off and ongoing live stream event promotion hosted at ABC Showcase HQ in Los Angeles.