Live shopping: Business potential & benefits of the e-commerce trend (1/3)

By 2026, around 20 percent of global e-commerce transactions could take place through live shopping experiences, according to a forecast by McKinsey. But what exactly is behind this innovative sales format, and how can European brands benefit? In this series, we take a behind-the-scenes look at live shopping events.

Join us in the first part to explore the origins, business potential, and advantages of the live shopping trend.

• Part 2: Live shopping: Best practices, brands & success stories (2/3)

What is live shopping?

Live shopping (also livestream shopping or video shopping) is a new marketing and sales channel in digital commerce that combines the benefits of online shopping with the experience of in-store purchases. In essence, it is similar to traditional teleshopping, with one key difference: brands present and sell their products not on television but via livestream on the internet.

Unlike TV shopping, live shopping offers:

• Interactivity: Viewers can actively engage during shows by asking questions in the live chat, participating in polls, or influencing the course of the show through comments. This interactivity fosters a sense of community while also creating a personal and engaging shopping experience.
• Convenience: While teleshopping once required customers to place orders via phone, purchasing via livestream shopping is just a few clicks away. Payments are processed directly through the streaming service or an integrated payment service provider (PSP) on the retailer’s website.
• Accessibility: Whether on a PC, laptop, smart TV, or mobile device, viewers can join from anywhere instead of being confined to their televisions at home.

How is it different from social shopping and video commerce?

Terms like social commerce and video commerce go hand in hand with the live shopping trend, yet they have distinct differences. While social commerce generally refers to sales through social media (e.g., posts, ads, and videos with “Shop Now” options), live shopping is focused on real-time shopping experiences and is a subcategory of video commerce.

From social events to concierge shopping

Live shopping events can also be categorized based on their format and reach:

• One-to-many
  Traditional live shopping shows are public, collective events designed to reach a large audience and showcase products on a broad scale.
  
•  One-to-one (Concierge shopping)
  A more personalized and highly effective form of live shopping is virtual one-on-one consulting and product presentation for individual customers, known as concierge shopping or personal live shopping. In a private video chat, a salesperson guides a customer through the product selection and provides tailored recommendations that can be purchased instantly.
  

Where did the Live shopping trend originate – and where is it headed?

The trend began in China with the launch of Alibaba’s platform Taobao Live in 2016. Its rapid success was largely driven by a major annual shopping event: Singles’ Day became a significant revenue booster for the platform. In 2020, Alibaba generated a total transaction value of $7.5 billion through Taobao Live within the first 30 minutes of the pre-sale campaign. According to Bloomberg, livestream shopping events worldwide already generated $60 billion in revenue in 2019, with the majority coming from the Chinese market.

Live shopping: Business potential worldwide?

Success in Asia has fueled expansion into other global markets. In the U.S., revenue from this innovative sales format is projected to grow by 36 % by 2026. Additionally, the size of the live e-commerce market is expected to double in the next three years, from $31.7 billion (2023) to $67.8 billion in 2026. In Europe, a study by technology provider VTEX found that 70 percent of consumers are interested in the “shoppertainment” format.

Does live shopping also offer opportunities in Germany?

In Germany, the trend is still in its early stages. However, live shopping is increasingly gaining popularity among German consumers. A study conducted in early 2023 found that most Germans are open to online events of this kind: 66 percent said they could imagine shopping via live shopping streams. According to a Statista survey, four in ten (39 %) of millennials in Germany have already taken part in live shopping events in 2022.

How can european brands benefit from live shopping events?

The combination of interactive home shopping, real-time product presentations with virtual consultations, and the fusion of online shopping with entertainment makes live shopping a promising additional sales channel, offering businesses several advantages:

• Customer engagement: Live shopping events allow companies to present themselves authentically and approachably. Influencers, celebrities, and experts as brand ambassadors help build trust, positively impacting brand perception, product reception, and customer relationships.
• New customer acquisition: Product discovery is a key reason why consumers participate in live shopping events. Instead of actively searching for products or brands, they get inspired during livestreams, making these sales shows valuable for attracting new customers.
• Higher conversion rates: Live presentations offer a clearer understanding of products, aid in decision-making, and increase purchase likelihood. Companies report conversion rates of nearly 30 percent – up to ten times higher than traditional e-commerce formats.
• Increased traffic: The time-limited nature of live events creates exclusivity, drawing high numbers of visitors to websites and online stores. Special promotions like discounts, giveaways, and limited-time offers further boost engagement and traffic.
• Lower return rates: Since viewers gain a better understanding of the product and receive instant answers to their questions, mispurchases can be reduced, leading to fewer returns.
• Direct customer feedback: Live chat interactions provide businesses with real-time insights into customer perceptions and common inquiries—valuable information for future product development and marketing strategies.
• Expanded target audience: Collaborations with influencers and livestreams on social media expand brand reach and attract new target groups.
• Cross- & upselling opportunities: Live shows provide an ideal platform to showcase complementary or alternative products, significantly increasing the average order value.
• Cost efficiency: Compared to other sales channels and traditional video marketing efforts like high-production commercials, live shopping streams are relatively cost-effective to implement.

Is the live shopping trend here to stay?

Considering the rapid success in China and strong global growth forecasts, it is likely that this trend will continue to establish itself in the European market. Given increasingly complex omnichannel strategies and evolving business models, this cross-media e-commerce sales channel presents exciting new opportunities for creating immersive shopping experiences.

Which industries are already leveraging live shopping for significant revenue growth? Find out in part two of this series. The third section shows you how to implement this technically and keep an eye on your data.

Want to boost sales with interactive real-time shopping experiences? Let’s talk!