This Festive Season, Shop Live—Online
Sellers turn to live e-commerce for a 'phygital' touch.
A click on Flipkart's two-wheeler segment takes you to an ongoing live stream: actor Rannvijay Singha and digital creator Rachit Hirani engage in casual banter while going over the features of listed motorbikes.
The two digital influencers explain offers, including a chance to win one of the vehicles on display on the live stream. More than 2,000 viewers send comments and questions on the chat window. A link at the bottom takes you to the online store to purchase the bike.
This is the digital version of TV live sales where chatty hosts urge viewers to 'call now' for not missing out the best deals on everything from apparel and air fryers to cutlery. Already a big fixture in China, sellers in India are turning to live e-commerce during the festival season.
The current live e-commerce market is less than even $300 million, according to Abhishek Tandon, senior consultant at Redseer. The strategy consultant's June 2021 report estimates it to cross about $4-5 billion in gross merchandise value by 2025.
This festive season, online lifestyle retailer Myntra is simulcasting more than 350 M-lives across the platform's official Instagram and Youtube pages, according to a spokesperson of the portal.
During its June sales, when the platform rolled out 24X7 live sessions for the first time, it clocked over 100 hours of engagement via live and video commerce, which has only been growing, said Dushyanth Jayanty, vice president for marketing at Flipkart. In the run-up to the festive season, it has partnered with more than 500 influencers across categories to help educate customers on how to buy and use products.
''If you see the entire adoption curve of e-commerce over the last 10 years, it has skyrocketed during the Diwali period,'' said Kaizad Hansotia, chief executive officer of Swirl, a live shopping mobile SaaS. ''It's a no-brainer that this is the best time to leverage video and live interactive commerce."
Redseer estimates fashion to contribute 60-70% of the live e-commerce GMV by 2025, with beauty and personal segment contributing the other 30-40%.
The number of e-shoppers in the country is expected to shoot up to 550 million in about five-six years from about 200 million currently, Tandon said. These shoppers will be very different, he said, adding that short videos are driving this format.
The Rise Of Live E-Commerce
During the pandemic, people were not able to venture out. So consumers behavior adapted to a 'live and video-first' approach as they were anyway consuming video content on social media, Hansotia said. Brands realised that they could tap into this behaviour and derive commerce out of it, just like China had successfully done, he said.
The value of China’s live-commerce market grew at a compound annual growth rate of more than 280% between 2017 and 2020, to reach an estimated $171 billion in 2020, according to a note by McKinsey. It's estimated to hit $423 billion this year.
Along with a permanent change in consumer behavior, internet speed and penetration, video-based selling has also skyrocketed because brands have realised that this is a digital approach which can bridge the online-offline gap, Hansotia said.
Brands can now leverage this new technology and existing staff inside a store or maybe in the warehouse, or use an influencer to create a 'phygital' experience where they are able to create the same interactions you would otherwise have had inside the store, he said. "Now, you can do it in a live show."
The 5G rollout is expected to accelerate the shift rapidly. "Our hypothesis is that in the next two to three years, video commerce will constitute at least 15-20% of e-commerce gross merchandise value," Hansotia said.
Given e-commerce platform Meesho's audience profile—tier 2 plus geographies and low-to-medium internet savviness—the platform is working towards building an online experience that’s closest to offline shopping.
"Our shoppers, a majority of whom are experiencing online shopping for the first time, love browsing endlessly through products. Hence, live video is emerging as a strong channel for engagement and purchase," it said.
Live commerce is entertaining and immersive, keeping viewers watching for longer. It also telescopes customer decision journeys from awareness to purchase, said the McKinsey note.
For Myntra, it drives consumer engagement initiative and allows it to showcase curated fashion edits, beauty tips and hacks, ethnic wear, styling recommendations and other noteworthy festive fashion segments.
On an average, 'M Live' has seen 100% engagement rates across sessions and the traffic has grown more than five-fold, Myntra's spokesperson said. Flipkart said engagement with vernacular creators rose 30% year-on-year and is now a key part of the platform's influencer marketing approach.
Companies report conversion rates approaching 30%, up to 10 times higher than in conventional e-commerce, according to McKinsey. The medium is also helping improve brand appeal and differentiation, it said.
Within live e-commerce, short videos are seeing rapid adoption because they have been around for longer than live videos and live streams, Hansotia said.
Every brand is converting existing short videos they already have on Instagram into shoppable videos, he said. "If you're a customer, rather than going to a product page and watching an image, you can simply click on the video and add products from the video to your cart."
China's experience shows the potential is unlimited, particularly when influencers are involved. China's social media star Austin Lee sold 15,000 lipsticks in under five minutes in a live stream.
Can an Indian influencer soon pull off an Austin Lee?