Blog post
June 24, 2019

How To Generate Sales Through Live Streaming?

Live streaming is becoming a leading sales platform in China. There are currently more than 200 live streaming sites with over 200 million users, according to huxiu.com, while Credit Suisse predicts the China live streaming market will see US$5 billion in revenue this year.

How does a 90-minute live streaming program create over $14 million in sales?

Source: “2017 China live streaming industry trend report” by Penguin Intelligence

2015 was a turning point for the streaming industry. Previously, China followed Western live streaming companies such as Meerkat, Snapchat and Periscope, but the landscape has since evolved. Thanks to the expansion of the 4G network, smartphones and mobile payments, live steaming platforms have solidified their place in marketing. Panda TV and Douyu.com are two key players, mostly focusing on online games, entertainment featuring singing and dancing, and other vertical live streaming markets.

When it comes to live streaming marketing, the most effective campaigns feature a combination of live streaming and e-commerce. According to the 2017 China live streaming industry trend report, 41.25% of respondents in China watched e-commerce live streaming at least once. Among those, 60% browsed the products recommended by the live streaming hosts, while 20% purchased the recommended products after watching the program.

Here are just a few brands that have enjoyed record-breaking live streaming campaigns in the past two years:

In April 2016, Maybelline launched a live streaming campaign to promote its new lipstick range. The brand invited famous Chinese actress Angelababy and several online influencers in the cosmetics sector to participate, and then broadcast the event via nine popular live streaming platforms. Over five million people watched the live stream, with over 10,000 lipsticks sold during the two-hour special, achieving RMB1.42 million (US$210,000) in sales.

In May, baby formula brand Illume invited famous movie star Wu Chan  to host a one-hour live stream on Taobao and Meipai. Through the shopping-while-watching function, the sales conversion rate reached 36% – seven times more than Illume’s regular e-commerce conversion rate – and achieved over RMB1.2 million (US$176,000) in sales during the broadcast.

Earlier this year, a live stream campaign on Tianmao smashed another sales record. According to Sina Finance, more than 350,000 people viewed the program called “The Meow Car”, produced by China’s largest automobile e-commerce website maimai.com. More than 1,400 Shanghai-Volkswagen Lavidas were sold and booking sales reached over RMB100 million (US$14 million) within 90 minutes of streaming. Within 24 hours, total bookings were worth RMB190 million.

Here’s a summary of the successful formats behind e-commerce live streams.

Key element 1: Celebrity + hot issues/event

As Eden Lau, Isentia’s Regional Director who oversees the Asia social media analysis services, says: “Celebrity-plus-event is one of the most effective and frequently used approaches in live streaming marketing.”  According to Isentia’s social media research into the luxury sector, hot posts and organic buzz led by celebrities rose from 12% in 2015 to 42% in 2017.

Source: Isentia luxury sector social data. Hot posts engagements relating to luxury brands, engagement refers to weibo reposts, comments

Among hundreds of live streaming platforms and thousands of programs that appear at the same time, celebrity premium definitely has greater pull to attract audiences.  “The Meow Car” program used TV star Kan Benben (阚犇犇), who played a very controversial role in the recent TV series In the Name of the People in China. Social media discussions about his character pushed related topics up the Weibo Hot Topics ranks.

Key element 2: Content is king, creative is queen

While people may be attracted to the celebrity ‘fame factor’, the key to a successful live streaming campaign is to have creative content that keeps people watching until they take action. “The Meow Car” was an online PGC (professionally generated content) program in an entertainment-show format. By leveraging hot discussions surrounding the popular TV series, the stream invited viewers to interact and tease actor Kan Benben by chatting and playing games with him live. Kan Benben’s entertaining responses and funny facial expressions captivated the audience. According to Tianmao, over 300,000 people watched the live stream and the program received 2.2 million likes.

Other common formats for live streaming campaigns include fashion shows or product launches. They are used as a tool to amplify the impact of the offline events and attract more audiences.

For example, last year L’Oréal invited Chinese celebrities Gong Li, Li Bingbing and Li Yuchun to live stream behind-the-scenes segments at the Cannes Film Festival for its official Meipai account. The streams received 160 million likes in total. During the live streams, Li Yuchun introduced L’Oréal products and recommended a lipstick that she used during the festival. After four hours of live streaming, the featured lipsticks were sold out in L’Oréal’s Tmall flagship store.

Other creative formats for live streaming campaigns include sharing new technology, teaching audiences about how to use new products, and revealing backstage or production procedures.

Key element 3: Discount promotions and the bandwagon effect

In the “The Meow Car” live steaming program, Maimai.com offered promotions such as: buy the Shanghai-Volkswagen Lavida and get a free iPad. Plus, for every 50 cars sold, the platform offered a lucky draw for a half-price car. The campaign also set up a purchase strategy by offering “0 first payment and only RMB499 booking fee” to boost sales.

Based on KPMG’s China’s Connected Consumers 2016 report, price remains the key driver behind online shopping – Chinese consumers are more price-sensitive during online shopping, and discounts are a major driving force.

Apart from the interactions between the live streaming host and viewers, comments from other viewers and purchase actions also have an effect on sales. Zhang Zhendong, founder of Bolo.me, a cross-border e-commerce site, says: “The reason that live streaming is able to dramatically improve the sales conversion rate is because the format creates a group effect among viewers. Under a strong inter-action scenery, the live streamer and the viewers are all pulling towards the same sales direction – bandwagon effect is affecting everyone.“

Alibaba’s CEO Zhang Yong has emphasized his views on the future of marketing on multiple occasions, stating that “marketing has changed, commodity needs content” and “content is the bridge to link people”.

Similar to online influencer marketing and short video marketing, live streaming is a new weapon in the digital marketer’s arsenal. For brands thinking about tapping into the live streaming market, we suggest starting with research and using tools such as social media analysis to uncover any live streaming case studies within your industry. The next step is finding the platform where your target audiences reside. Only then should you identify any celebrities or online influencers that you can partner with. Most importantly, understand the trends and hot topics to create attractive content for your audience.


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