Last updated: Live commerce: Livestream shopping benefits, examples, and challenges

Live commerce: Livestream shopping benefits, examples, and challenges


Listen to article

Download audio as MP3

Most American shoppers are familiar with QVC and the Home Shopping Network (HSN), the $1.6 billion TV shopping channels. But many haven’t heard of an up-and-coming digital rival to those mainstays: livestream shopping.

A concept that’s been trialed off-and-on since the early 1990s, live commerce caught fire in China with the kickoff of Alibaba’s Taobao Live then expanded to the rest of the world during the COVID lockdowns when retailers had to find alternative ways of connecting with consumers.

Since then, the model has continued growing. Coresight Research predicts the global livestream shopping market will reach $512 billion this year, with about $50 billion of that in the US.

Livestream shopping offers retailers a number of benefits, but continued growth hinges on overcoming several hurdles. Here’s what retailers need to know about this e-commerce trend.

The thrill of it all: Livestream shopping attracts viewers, big brands, and investors

Livestream shopping is pretty much what it sounds like. A retailer schedules a live online event in which a host, often a celebrity or influencer, promotes products or services. The hosts generate excitement, answer questions in real time, and seek to create a sense of urgency around their wares by updating viewers on how fast they’re flying off digital shelves. Short-lived giveaways and promotions often add to the excitement.

Numerous major retailers have jumped in to host livestreamed shopping events, including Macy’s, Dick’s Sporting Goods, American Eagle, Nordstrom, JCPenney, Bloomingdale’s, Aldo, Petco—even QVC and HSN. Online giants Amazon and eBay have gotten involved, and there are a number of live commerce platforms such as Facebook Live, TikTok Live, and YouTube, in addition to startups such as LIVEBUY.

Investors infused more than $380 million into US livestream e-commerce companies last year compared to $36 million in 2020, according to the New York Times.

Still, Livestream shopping’s future is far from certain given some platform providers have already pulled back from it and 78% of adults in the US saying they’ve never taken part in a live shopping event.

But experts say post-pandemic traction suggests it could still become a valuable retail channel. Georganne Bender, a retail influencer and principal at KIZER & BENDER, said livestream shopping saved her clients during COVID and opened many profitable, lasting opportunities.

“Livestreaming is everywhere. At this point, I can only see it getting bigger,” she wrote in response to a Retail Wire report about the trend.

Greater reach, more conversions, younger shoppers 

Livestream shopping is gaining traction because it offers the kind of interactivity and engagement that young, technically literate shoppers really enjoy, experts say.

In fact, 60% of shoppers who have tried it say it improved their online shopping experience, a Klarna study found.

Other benefits of live commerce for retailers include:

  1. Reach shoppers at scale. CNBC reported the story of Anthony Velez, CEO of Bagriculture, a small business selling pre-owned designer handbags in New York. Earlier this year, he closed his physical stores, which had been earning about $100,000 a month, and went all-in on livestream shopping. Since then, he said he’s been making $100,000 a day. Why so much more? Velez said one of the biggest contributors was the capacity to host live events on multiple platforms, reaching vastly larger audiences.
  2. Boost conversions. One of the biggest benefits of live commerce is how it can help improve retail conversion rates, or the percentage of visitors who make a purchase. According to a 2021 McKinsey report, companies report conversion rates of nearly 30%—up to 10 times higher than in conventional e-commerce. Likely recognizing this, Walmart was reportedly collaborating with TalkShopLive on a plan to sell books, music, makeup, housewares, and other products through a livestreamed Shoppable Simulcast.
  3. Reach younger audiences. Marketers are constantly looking for ways to tap into the spending power of millennials and Gen Zers. Since livestream shopping shows tend to exist on sites and apps young people prefer, it’s particularly useful for connecting with these buyers. For example, Qurate Retail Group, which owns QVC and HSN, recently introduced a mobile app called sune, which it bills as an experiential shopping platform to feed Gen Z’s “desire for more seamless on-demand live shopping experiences.” And with young people’s interest in vintage and preowned clothing, recommerce platform Poshmark hits a sweet spot with its livestreams.

Not so fast: Livestream shopping speedbumps

Of course, given livestream shopping momentum is so recent, many industry observers remain skeptical about the trend’s staying power. Some of the more common adoption hurdles they cite:

  • Technology requirements. Most retailers can’t do this on their own. To reach mass audiences in this way, you need a technological backbone that few can afford. TV stations like QVC/HSN already have that. But other platforms like TalkShopLive are relatively new to this game, which means they might not yet be capable of providing what retailers need. What’s more, other platforms like Instagram, Facebook, and TikTok have reportedly retreated from or delayed their livestream shopping offerings for various reasons, limiting hosting options – at least for now.
  • Competition from brick-and-mortar stores. There’s evidence that young people, while big online shoppers, are also nostalgic about in-store experiences. So, as always, brands should view live commerce as part of a broader integrated distribution channel strategy to meet consumers on their channel of choice.
  • Scheduling constraints. One of livestream shopping’s structural weaknesses is the fact events are scheduled for particular times and days. If consumers aren’t available, they can’t join. And video replays won’t cut it since the whole point is to generate buzz among people taking part in the live event.
  • Lack of awareness and apathy. While live commerce is extremely popular in China, where it’s produced star influencers, it’s been slower to catch on in the US. Some theorize this is because it had a head start in Asia. Others say it’s because it hasn’t been publicized enough. Others maintain Americans simply prefer other types of shopping experiences.

Despite the challenges, livestream shopping is another avenue for retailers to reach consumers in a very crowded market. Each brand will need to consider the pros and cons for their business and target audience.

Shifting retail landscapes.
Varying buying behavior.
What makes people click “buy”?
We’ve got the answers HERE.

Share this article


Search by Topic beginning with