When streaming and shopping merge: New opportunities for your e-business

Many companies are currently investing large sums in AI projects, for example for chatbots, intelligent recommendation algorithms or automated customer support systems. They hope that this will fundamentally change consumer behavior. However, as great as the potential of AI may be, AI will not significantly change shopping behavior itself. After all, despite all the technological advances, there is one thing that people do not want to do without, especially in the consumer process: a personal connection, live interaction and the feeling of being part of a real event.

This is where a development comes in that is often underestimated, but is already showing its strength: live commerce. Products or services are presented in real time via livestream, viewers can interact directly and buy immediately if they like them. This approach goes far beyond traditional commercials or static product detail pages and satisfies a deeply human need: to come into contact with other people in as authentic a context as possible.

Why shopping is more than just a shopping process

Online shopping is convenient, fast and practical. Whether it's food, fashion or electronics, the desired products can be added to the virtual shopping cart with just a few clicks. However, many people miss the atmosphere they are used to in bricks-and-mortar stores: personal advice, trying things out, getting direct feedback from others. It is precisely in this gap between the purely online transaction and the offline experience that the great opportunity of live commerce lies.

The true core of the shopping experience lies in the

1. emotional connection: People not only buy products, but also feelings such as enthusiasm, a sense of belonging or security.
2. social interaction: A nice conversation with the salesperson or a recommendation from a friend can provide the decisive impetus.
3. FOMO (Fear Of Missing Out): Livestreams create a “now or never” feeling. When others enthusiastically buy something in the stream, it creates a pull that is hard to escape.
   

Live commerce: the biggest opportunity for online retail

Live commerce is the fusion of live streaming and e-commerce. Sellers - or presenters and influencers - present products or services live in a video stream, while viewers can ask questions and buy directly in real time. This approach has several advantages:

1. Direct demonstration: Potential customers see the product “in action”. A real demonstration is always more credible than edited photos or marketing texts.
2. Live interaction: The audience can ask questions, express doubts or give feedback. This is similar to a personal consultation in a store.
3. Authenticity: A livestream conveys the feeling of taking part in something “real” and not just consuming a pre-produced advertising message.

The live commerce market in Europe is showing considerable growth and will develop significantly over the next 5 years:

1. The number of live commerce viewers in Europe will rise to over 260 million by 2025 [1]
2. The global market for live commerce platforms, including Europe, is expected to grow from USD 1.1 billion in 2023 to USD 6.3 billion by 2032, with a compound annual growth rate of 21.5% between 2024 and 2032 [1]
3. In Germany alone, live shopping generated sales of around EUR 2.23 billion in 2021, an increase of five percent compared to the previous year [5]
4. According to a survey by McKinsey & Company, 72% of European consumers have already participated in live commerce activities, which shows the growing interest in this shopping format [1]
5. Live commerce is expected to account for over 5% of the total e-commerce market share in Europe by 2026 [2]

These figures illustrate the considerable growth potential of live commerce in Europe in the coming years, driven by increasing consumer acceptance and the expansion of e-commerce platforms.

What makes live commerce so powerful?

The key lies in our deep-rooted desire for humanity and connection. Neuromarketing studies show that people buy above all when they:

- feel an emotional connection to a brand or person.

- have confidence in the person presenting the product and their expertise.

- have the certainty that the product really works or offers added value.

While AI technologies can certainly shine in areas such as chatbots or price optimization, the moment of “human closeness” often falls by the wayside. No algorithm can compete with a real, likeable person who is enthusiastic and visibly convincing in front of the camera because they really believe in the product. The social component is what makes live commerce not only efficient, but also particularly exciting.

New platforms, new possibilities: TikTok, Whatnot & Co.

It's worth taking a look at the platforms that are already generating sales success in live commerce:

- TikTok: The short video platform is particularly popular with the young target group and was an early adopter of live shopping, often referred to as social selling. Here, viral trends and direct buying impulses merge into an entertaining format. Data protection concerns or not - TikTok has implemented live-based e-commerce concepts very successfully.

- Whatnot: The platform is considered the fastest growing in the live shopping sector. What began as a niche for collectors and lovers of special products is developing rapidly. Commercial users report monthly sales of up to 170,000 US dollars via Whatnot - an impressive example of the potential of live commerce offerings.

In addition to these pioneers, more and more players are trying their hand at live commerce. Large social networks, shopping platforms, but also innovative start-ups are looking for concepts to merge live videos with shopping opportunities. It is worth observing the market and considering at an early stage which platform is best suited to reaching your own target group.

A brief look at the history of e-commerce

The path that online shopping has taken so far explains why the live commerce boom seems “logical”:

Phase 1 - Cataloging: in the beginning, there was the simple product catalog on the web. Customers clicked through rigid pages and ordered when they were interested.

Phase 2 - Personalization: As technology progressed, personalized product recommendations and automated newsletters were added. Big data and AI began to predict customer tastes more accurately.

Phase 3 - Social commerce: Social networks enabled the direct integration of products into content. Influencer marketing became an important driver for purchasing decisions.

Phase 4 - Live commerce: The live experience comes to the fore. It's like strolling through a store again, only virtually and with a potentially unlimited global audience.

The logical consequence of this development is that people who are already used to online shopping want more “real” interaction again. The livestream is the ideal format for this.

Tips for getting started in live commerce

1. Use a professional streaming provider

Companies should use a professional streaming provider for live commerce in order to benefit from several key advantages:

• Technical reliability and quality: A professional video streaming provider guarantees a stable and high-quality transmission. This is essential, as technical problems during a live stream can lead to a loss of trust and lost sales opportunities.
• Cost savings and efficiency: Although using a professional service may initially appear to be a cost factor, it saves resources in the long term. The providers take care of video hosting, encoding and transcoding, which reduces internal IT costs.
• Reach optimization: Professional providers enable simultaneous broadcasting (streaming) on various channels such as YouTube, Facebook, Instagram or Tiktok, which significantly increases reach.
• Data protection and compliance: Streaming service providers based in Germany in particular pay attention to GDPR compliance and the protection of your data, which is essential for companies in the EU.
• Interaction opportunities: Professional streaming platforms offer advanced tools to enable interactions in your livestream to drive customer engagement and enhance the shopping experience.
• Analytics and measurability: With a business streaming platform, companies receive detailed analytics on their streams and real-time feedback, making it easier to optimize campaigns and measure ROI.

By using a business video platform for streaming and video hosting, companies can concentrate on their core competencies and at the same time benefit from a technically mature, high-reach and data protection-compliant solution that significantly supports success in live commerce.

2. Promote your livestream in advance

A livestream is only effective if it is seen by as many people as possible. Therefore, build up awareness early on and make sure that your target group knows about the upcoming event.

• Teasers and pre-announcements: Use all channels - email, social media, Whatsapp, notice on the website - to market the livestream as an “event”.
• Exclusive offers: Make it clear that certain discounts or limited editions are only available during the livestream. People love exclusivity and the feeling of missing out on something special if they are not there.
• Countdown and reminders: Work with a countdown. Send a final reminder shortly before the start of the live event.
  

3. Use live Q&A

A livestream thrives on interaction. Unlike recorded videos, you can respond to objections, questions or ideas from your audience in real time.

Transparent communication: If you don't know something, admit it openly and promise to provide the information later. Nobody expects you to be omniscient - honesty creates sympathy.

Targeted preparation: Prepare the most frequently asked questions about your product or service. This will ensure that the stream remains fluid and important aspects are not forgotten.

Build trust: Live Q&As are almost like a face-to-face customer meeting in a store. Here you can respond directly to questions or objections. Make sure you address each questioner directly to establish a personal connection.

4. Formulate a clear call-to-action (CTA)

What good is the best livestream without a clear call to action? People need clear instructions on what to do. Use precise wording such as “Click on the link below this video now and add the product to your shopping cart”. This is easier to understand than a vague “See if you like it”.

Signal urgency by pointing out limited stock or limited-time offers, for example. A CTA such as “Only available for the next 10 minutes” increases the likelihood of purchase enormously.

The path to the product should be as short as possible. Every additional click or cumbersome registration process reduces the motivation to buy. Promote your CTA several times during the stream. Repeat it so that people who have just joined the stream or are distracted do not miss the information.

5. Practise, practise, practise!

Successful live commerce takes time, practice and a certain amount of courage. Not everyone immediately feels comfortable speaking in front of a camera or responding to spontaneous questions. But this is exactly where the potential lies: authenticity beats perfection. Small slips of the tongue or a nervous smile make you approachable and likeable.

Be authentic. People like real personalities more than overly perfect commercials. Humor, background stories and examples from everyday life bring your stream to life, as does interaction with your audience through targeted questions and inquiries (“What do you think of this color?”, “What would you use the product for?”).

How AI can improve the shopping experience

AI technologies offer a number of advantages for optimizing the purchasing process. In combination with live commerce, AI can even have a synergetic effect. For example through:

• Automated product recommendations: Before you go live, AI can use inventory and customer data to help you select the exact products that will sell best.
• Personalized advertising: AI can analyze which target groups respond particularly well to your content and support you in targeting them.
• Speech and text recognition: Live streams could be automatically provided with subtitles to ensure greater accessibility.

Nevertheless, the human factor remains irreplaceable: the ability to respond spontaneously to emotions, to convey humor, to take away uncertainties - these are all facets that an algorithm cannot (yet) achieve.

A future-proof strategy: live commerce as the new standard

The e-commerce landscape is developing very dynamically. Technologies and platforms come and go. What remains is the human need for networking. Those who recognize this core and consistently integrate it into their business model will be successful in the long term.

Live commerce is not a short-term “hype”, but will establish itself - in whatever form - as a standard format in online shopping. Live commerce is not a concept that only works for corporations with large budgets, but is suitable for any company looking for a direct line to its customers - from solopreneurs to established SMEs.

Train yourself and your team in the art of live streaming. Storytelling, camera presence, marketing - all skills that will be indispensable in the future. Focus on human proximity, genuine engagement and a live experience that strikes a chord with your target group. The key lies in continuous interaction with the audience. Technologies and platforms may come and go, but the desire to communicate from person to person while feeling safe and entertained remains. Capitalize on this desire, be creative and develop a live commerce experience that delights your customers.

If you have any further questions about live commerce and livestreaming, we look forward to hearing from you. Let's shape the future of livestream shopping together - real interaction and human proximity included!

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