Livestream shopping is already popular amongst social media users who purchase products online in China. But does live shopping have a future in Australia? Capterra surveyed over 1,000 online consumers who regularly use social platforms to see how they feel about going to a live shopping event.
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Live shopping has grown exponentially in recent years in the eCommerce marketplace in China. The Chinese livestream sector was predicted to hit US$180 billion in 2022 and US$720 billion in 2023. Interest in the online retail model is also gaining traction in the USA, with livestream revenue expected to reach US$57 billion by 2025. But what about Australia?
For now, it seems the transition to livestream commerce has been slower but still has potential for growth, especially with the digital age leading to an increase in video marketing in advertising. Will live shopping naturally take its place within the eCommerce sector in Australia? Capterra interviewed over 1,000 online shoppers who regularly use social media to determine if they already live shop and whether consumer interest exists. The full methodology is available at the end of this article.
What is live shopping?
Live shopping (or livestream shopping) is an opportunity for brands and retailers to leverage, promote, and sell their products in real time across their channels. This usually occurs through social media sites, such as TikTok, Instagram, and Facebook, or via live-streaming platforms. Livestream shopping events are often hosted by an influencer, celebrity, or sometimes the company's CEO or representative.
According to Capterra’s survey results, over half of respondents (59%) are aware of the concept of live commerce, as a quarter (26%) said they know what livestream shopping is exactly, and 33% know the concept but did not know the name. However, only 31% of survey-takers said they had participated in a live commerce shopping event, meaning most Australians (69%) have still yet to experience it.
The largest generational group who said they have participated in a livestream commerce event comprises millennials (46%), accounting for double that of Generation Z (23%). This was closely followed by 20% of Generation X and only 4% of baby boomers.
Unsurprisingly, survey results show that the younger generations use social media more often, with the majority of Gen Z (52%) using it more than 10 times daily. Most survey-takers in the millennial age bracket (44%) said they use social media three to 10 times daily, closely followed by Gen X (34%). As for baby boomers, the majority said they use social media platforms on average one to three times a day (32%).
Even though Gen Z tend to engage with social media most often, they have a lower rate of participation in live shopping events than millennials. Whilst Capterra’s 2022 Metaverse Survey of Aussie consumers saw that 48% of Gen Z and 44% of millennial respondents prefer to shop online (compared to just 28% of Gen X and 11% of baby boomers), it doesn’t necessarily mean Gen Z spend as much money. To target the younger consumers of the future, SMEs need to understand how generational differences affect buying behaviour.
What are the benefits of live shopping?
Live shopping has many advantages for both consumers and retailers. Event hosts can provide thorough information and give detailed product demonstrations. Seeing the physical attributes of a product and having questions answered on the spot may lead to higher customer satisfaction. For brands, it’s an opportunity to be creative and bring a fun experience to the customer journey.
When survey-takers were asked to explain the reasons why they use live shopping, ‘to buy products online’ (38%) was the most-selected answer. This was followed by being able to ‘discover new brands and products’ (29%) and ‘find out about offers and discounts’ (28%).
These responses reflect the benefits of livestream commerce as, for busy consumers, shopping is made easier and more convenient. Offering lead magnets, such as discount codes, can positively influence customer engagement and boost brand awareness.
Social media tools (e.g. Instagram and Tik Tok) proved to be the most commonly used platforms for live shopping, according to 72% of survey-takers who have participated in a live commerce event before. Two-thirds (67%) said they had used video streaming platforms (e.g. YouTube and Twitch), whilst attending via a ‘seller’s application’ was less common (19%).
When asked about the products survey-takers find the most interesting to watch via a live commerce event, ‘apparel and fashion’ goods (49%) were most selected. Other popular products to watch during a live shopping event include:
- Food and beverages (42%)
- Electronics (40%)
- Beauty and wellness products (39%)
- Sports products (33%)
- Home decor (33%)
We broke down these stats in terms of generations and found that Gen Z most frequently selected beauty and wellness products (49%), millennials chose apparel and fashion (53%), whilst both Gen X and baby boomers went with electronics (at 41% and 75%, respectively).
How do users rate their experience with live shopping?
What impact does attending a live commerce event have on consumers? An overwhelming majority of survey-takers who have participated in live shopping (94%) say they have bought something as a result. According to these live commerce users, 74% are satisfied with their overall shopping experience compared to only 13% of unsatisfied users.
The reasons survey-takers most frequently cited for being satisfied with live shopping included ‘liking the products presented’ (61%), the ‘technical aspects of streaming’, such as video quality and the live Q&A (55%), and the ‘detailed product description’ (46%).
Why are some Australians not interested in live shopping?
Almost one in five consumers surveyed (19%) said they have not participated in a live commerce shopping event and are not interested in trying it. The reason most cited by these survey-takers was that they are ‘already satisfied with more traditional ways of shopping’ (58%).
What would motivate survey-takers to try live shopping? Lead magnets again prove to be an important part of a live commerce marketing strategy. Those with zero interest in live shopping rated ‘exclusive deals or discounts offered during an event’ as the top reason to entice them to try it (37%). It is worth noting, however, that the third most selected answer by respondents in this group was ‘no factor would be motivating to try live commerce’ (34%).
The 50% of respondents who said earlier that they had not participated in live commerce, but were interested, selected ‘buying products online’ (48%) and ‘discovering new brands’ (43%) as the most common reasons they would try it. Live shopping events and generating strong social media content can be especially helpful for smaller businesses with limited resources, enabling them to reach customers wherever they are located, whether that’s nationally or overseas.
How businesses can implement a live shopping strategy
The following are essential steps for SMEs to consider when implementing live shopping:
1. Choose the right platform: Whilst social media networks have live streaming capabilities, not all of them have shopping features that enable consumers to buy products they see on the stream. Decide if you want to stream via a platform dedicated to live shopping (e.g. Amazon Live, Google Shopping, or TalkShopLive) or through your own eCommerce store using live streaming software.
2. Choose your products: Determine which products or services you would like to advertise during a live broadcast. Experiment with featuring some of your best-selling products and those soon to be discontinued and see how the audience responds. Perhaps choose a product that you are most passionate about to get started.
3. Select the format: Next, you will need to decide how to structure your live shopping event. Will you host a question and answer session or a product demonstration? Another idea is to interview an existing customer for a live review of your product. It’s also important to figure out how long the session will last and how many products to include.
4. Rehearse the livestream: Before going live, you should do a run-through of the event and practise in front of the sales and marketing team representatives. It’s important to ensure no technical errors, such as a weak internet connection or any sound issues. It’s also an opportunity for the host to rehearse what they will say and the product presentation order.
5. Promote your live shopping event: Use your social media channels to advertise your event with the date, time, and link to join. You can also inform customers about your live shop event via emails or on your website blog. Email marketing tools can help companies to incorporate livestream shopping as part of their email marketing strategy.
What is the future of livestream shopping in Australia?
The transition to livestream eCommerce seems to be taking off much more slowly in Australia compared to China or the USA. But it certainly has the potential to help businesses improve their retail marketing strategy and, ultimately, the customer journey experience.
When asked which scenario best applies to the future of live shopping, most survey-takers (44%) agreed with the statement: ‘Live commerce will become a popular way of shopping (i.e. widely known among the general public)’.
Promisingly, only 5% said they think live shopping won’t work and the method will disappear over time. Most of the survey-takers who said live commerce would become popular said they think it will happen within the next six months (43%), highlighting an overall positive outlook by consumers.
Livestream commerce is another type of content that can be added to a business's overall content marketing strategy. Online retail makes shopping more accessible for consumers, and with interactive content, such as live comments, questions, demonstrations, and polls, customers will feel more engaged and perhaps even more tempted to purchase a product.
Collating consumer information and building customer profiles is key for businesses to recognise how to appeal to different generations and target audiences. For example, deciphering how to tap into Gen Z's tech-savviness could lead to increased eCommerce spending. For now, it seems that livestream shopping is a trend that is gaining a lot of traction and can help brands to have an edge over their competitors.
Capterra’s survey-takers who use live shopping said their preferred event host is an ‘influencer’ (34%). This was followed by “an expert on the product” (22%) and ‘a celebrity’ (20%). Companies may want to consider an influencer marketing strategy when incorporating live shopping, which is a topic that we discuss further in the next article in this two-part series.
Data for Capterra’s Live Commerce and Influencers Survey was collected in April 2023. Results comprise responses from 1,015 Australian participants. The criteria to be selected for this study are as follows:
- Australian resident
- Between 18 and 65 years of age
- Shops online at least every couple of months
- Uses social media platforms at least a few times per month