What is live shopping?

Live shopping (also known as livestream shopping) describes an innovative form of sales and marketing in e-commerce in which companies present and sell their products via livestream. The concept is similar to the well-known teleshopping – with the key difference that the show is not broadcast on a TV station, but on the internet.

During the live shopping session, a presenter (host) or salesperson guides viewers live through the product range, explains the functions, special features and benefits of the items and demonstrates how to use them. Viewers can ask questions in the chat that are answered during the livestream, take part in surveys or even help determine the course of the show with their comments. The possibility of real-time interaction creates a dynamic virtual sales environment that is reminiscent of the shopping experience in a traditional store or retail store. In contrast, however, the reach of digital live shopping is far greater.

Live shopping can be seen as a new form and sub-concept of video commerce. The main difference lies in the real-time interactivity:

While live shopping relies on real-time broadcasts where customers can interact directly, video commerce can also describe a more passive experience where customers can watch recorded advertising and product videos at any point in time. While these video-on-demand offerings also allow customers to ask questions about the product via a comment function, there is no option to interact directly with the host while watching.

As live shopping relies on a spontaneous exchange with viewers and quick purchasing decisions, this e-commerce trend creates an immediate connection and urgency that traditional video commerce formats cannot always offer.

Two other terms that are often used in connection with live shopping are social shopping and social commerce. Like live shopping, these sales concepts also take an interactive approach. However, they differ in the way they engage (potential) customers and promote sales.

Social shopping integrates the marketing and sales process into social networks – often also in the form of videos. Users become aware of products through professionally produced advertising clips or through influencers and content creators, for example, and can buy them directly via the social media platform or a link to the online store. Social shopping focuses on continuous content and relies more heavily on personal recommendations from other users or well-known role models (influencer marketing).

Live shopping shows can also take place via social media and can therefore be described as a social shopping format. However, the focus here is more clearly on the event-like character and real-time interaction with the host, which creates a direct connection between brands and viewers.

Concierge shopping (personal shopping) is a special form of live shopping: this e-commerce trend also enables an interactive shopping experience via livestream. However, while live shopping is aimed at a broad audience and invites people to participate in public livestream sessions(one-to-many), the presentation and sale in concierge shopping is aimed at a single person(one-to-one). The customer receives individual advice and personal, tailored recommendations in a one-to-one conversation via video chat. A salesperson guides the customer through a store or online store, for example, presents the product range and helps them choose the right products.

Live shopping combines live streaming with e-commerce functions. The live streams are often played on social media platforms, but can also be embedded in a company’s website or online store using appropriate plugins. A third option is specialized live shopping platforms. These already offer practical live shopping functions, including survey options, chat and comment areas as well as services for the digital shopping process (e.g. checkout with links to external payment services such as PayPal). Integrated buy-now buttons and links for (immediate) purchase make it possible to order the presented products directly, which makes live stream shopping particularly easy and seamless.

In China, the success of the live shopping trend was spurred on by the launch of Alibaba’s live streaming platform Taobao Live, among other things. There are now also specialized live shopping streaming platforms and apps from Western providers, some of which have been developed in-house:

• Livescale
• NTWRK
• Bambuser
• Popshop Live
• Talkshoplive
• Buywith

In Europe, social networks have so far been the most popular means of implementing live social shopping sessions. Influencers in particular help companies to achieve a wide reach via Facebook Live and Instagram Live, for example, while creative formats on TikTok and YouTube Live appeal to younger target groups in particular. Traditional retail brands are active on Amazon Live, among others. In principle, each live shopping platform offers different functions and advantages that companies can use strategically to reach their target groups effectively.

It is not only the platform that determines the impact and success of live shopping events, but also the way in which products are presented. A distinction can be made between the following live shopping formats, for example:

For brands, live shopping is an additional marketing and sales channel that opens up new sales and revenue opportunities as part of a holistic omnichannel strategy. The ability to present products live to a large audience in an effective, entertaining and interactive way has a number of other strategic advantages: Live demonstrations give viewers a more accurate and better idea of the products within a very short space of time. Despite quick impulse purchases, this can prevent incorrect orders and returns, saving fashion retailers in particular high costs and lost sales.

The direct exchange with the audience also contributes to a feeling of closeness and community, which can improve customer relationships and strengthen brand loyalty. In addition, real-time feedback provides valuable information for the optimization and further development of products and their marketing. Frequently asked questions from viewers can be incorporated into future advertising measures and live shopping sessions.

So far, live shopping has been particularly popular for B2C retail sectors. There is great sales potential for product groups where the focus is on appearance and aesthetics and/or where functionality and benefits can be demonstrated without physical contact, for example in the areas of fashion (clothing and jewelry), beauty and health (cosmetics), electronics (household and entertainment appliances) and interiors (furniture, decoration and furnishings).

For viewers, live shopping provides an interactive and entertaining shopping experience that also offers benefits: Customers see and experience products in action, which helps them make better purchasing decisions. The ability to ask questions during the live stream and receive immediate answers also contributes to this.

In addition to interactivity and transparency, the entertainment value scores points: charismatic hosts and influencers or special show content such as competitions, surveys and gift promotions increase attention and bring fun to online shopping. Many brands integrate exclusive offers and discounts into the live shopping sessions to create an additional incentive to participate.