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Livestreaming becoming a necessity for many retailers

By HE WEI in Shanghai | China Daily | Updated: 2020-06-03 10:24
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A livestreaming host promotes cosmetics products of L'Oreal at the company's office in Shanghai on May 13. [Photo/HE WEI for CHINA DAILY]

In its virtual broadcast showroom, hosts introduce new features of a suite of gadgets that simplify cooking and food preparation. In light of the novel coronavirus epidemic, the campaign has become even more regular since February, with the number of daily broadcasts and the duration of each show both rising by 10 percent.

Her remarks echoed AdMaster's report, which found that 53 percent of surveyed marketers place more emphasis on short videos and livestreaming for better engagement with customers and the creation of original and compelling content.

Debates abound as to whether livestreaming is the new benchmark for branding and sales purposes.

For the likes of Xiaohongshu, a social media and e-commerce platform featuring the recommendation of goods and lifestyles, its KOL-led livestreaming is positioned to divert traffic to offline malls and drive sales.

As part of efforts to drive spending-especially in brick-and-mortar stores-the site is on course to unveil a series of online-to-offline marketing campaigns in collaboration with over 100 physical stores in Shanghai, Beijing, Wuhan in Hubei province and Guangzhou and Shenzhen in Guangdong province.

Influencers and KOLs can then shop in these stores and share their experience and insights online. By influencing other users, they could help boost consumption and consequently drive economic growth, said Xiaohongshu's founder, Qu Fang.

For instance, by joining an influencer's livestreaming session on Xiaohongshu, a jewelry designer under the avatar Judy has received warm responses from her millions of viewers, who expressed an eagerness to purchase certain earrings from her store outright after watching the shows.

L'Oreal's Zong also sees the potential for livestreaming to bring in new groups of customers, and in her case that translates into the particular addition of older generation of customers who are now embracing phone-based socializing and shopping.

But if it has to be an "either or" question, Zong would choose the former.

"Compared with simply promoting sales, providing premium services is more of an end in itself. Answering questions posed by livestreaming spectators has proved to be an effective way of engaging with customers," Zong said.

The benefits of livestreaming for brands like Signify are somewhat more complicated.

Like many others, the Dutch lighting giant has incorporated livestreaming as an essential part of its digital marketing team, and it adopts a combination of KOL resources and in-house online hosts for the livestreaming.

But since the company sells both to business customers in large quantities and individual end-users, the best strategic positioning for livestreaming varies.

"For B2B businesses, our definition of 'livestreaming' is more akin to that of a webinar, where experts and sales representatives share product and technology know-how through regular online sessions," said Xiao Dan, head of integrated and marketing communications at Signify in China.

It is in part because the wholesale system works in a far more complicated manner than that of the retail model, where a link could easily lead to payments. "In the B2B case, you always need to double confirm the orders through regular contacts. So driving sales doesn't really suffice."

And unlike goods in the fast-moving consumer goods sector-which can easily spur impulse-purchases-even consumer-facing bulbs and lighting systems are mainly considered durable goods whose decision-making prior to purchase is normally based on a series of prudent studies rather than endorsements and impulse.

That has propelled Signify to convert its livestreaming studio into a showroom, where it gets to display everything from how a complicated tool works to comparisons with rival products.

Xiao sees livestreaming as a powerful complementary strategy to offline product launches or customer events. But the power of face-to-face interactions is irreplaceable.

"We do offer special coupons if customers secure a deal through our livestreaming sessions. But that's not the sole purpose driving what we do," she said. "It's more a bonding opportunity between us and our customers and our partners."

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