China: live e-commerce is transforming consumption habits

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AFP-Relaxnews

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Jul 9, 2021

First launched in China five years ago, live e-commerce is entering a new phase. The Covid-19 pandemic has prompted a growing number of people, especially the younger generation, to switch from in-store shopping to online and live shopping.

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In China, influencer-streamers sell millions of articles per day on streaming platforms. Behind these new kind of workers, companies are investing to reach as many people as possible. On July 2, Bytedance, the company that owns TikTok, invested 1.48% in Weinian. Weinian is a company focused on new consumer sectors and which has contracts with highly acclaimed Chinese influencers. This approach testifies to Bytedance’s ambition to extend its footprint in the booming sectors of livestreaming and new consumption.

Between March and December 2020, the number of live e-commerce users in China exceeded 388 million, according to a report from China Internet Network Information Center, a government agency. That’s 123 million more in 6 months. For brands, potential customers are essentially young people, more and more followers of a new form of consumption. China’s live-streaming e-commerce market takes advantage of this to record 121.5 percent annual growth with revenue of 961 billion yuan (around $ 150 billion), according to iiMedia Research, an analytics firm and data mining.

“For Bytedance, collaborating with companies like Weinian and working with key opinion leaders or idols can drive more traffic for brands from popular platforms like Douyin, the Chinese version of TikTok,” said Dong Dengxin, director of the Institute of Finance and Securities at Wuhan University in an interview with the Global Times.

Key opinion leader

On Weibo, the Chinese social network, the news of this collaboration received largely positive reviews. Chinese Internet users see it as a way to extend Chinese culture in the West and to publicize their areas of interest. In China, KOLs for Key Opinion Leader (wholesale influencer) are assets of choice for brands. The impact of their notoriety on sales figures is staggering. Viya, a Chinese influencer who collaborates with Weinian, sold during a stream-event watched by 37 million Internet users simultaneously for more than $ 365 million in merchandise in one day! And KOLs, there are plenty of them. Alibaba announced a year ago that it wanted to create an army of influencers of more than a million people within three years. The advent of the sector has given desire to many young aspiring to become the next star of live-streaming e-commerce.

Taobao, a sales platform for merchants to generate more than 400 billion yuan (about $ 61 billion) in gross merchandise volume of which 80% is from streaming. For tech giants or brands, this market is a boon for development. As for young Chinese people, there is a long way to go before they succeed in making themselves known on its platforms. However, this live-streaming e-commerce phenomenon should continue to break sales records.

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