The Nothing phone recently sold out when Flipkart launched it on a live video. Here's why platforms like Myntra, Meesho are betting big on live commerce.
Online shopping in India is shifting to a new direction. Recently, the Nothing Phone (1) made its debut in India on the ‘Flipkart Live’ platform. Around 3.8 lakh users logged in for the sale, with more than 3.19 lakh peak concurrent viewers.
According to a press note, the sale of Nothing Phone (1) was live for just 10 minutes and all the units were sold off by then.
Flipkart has been routinely experimenting with the live commerce section on its app. It engages with content creators to promote different products that make up its inventory.
Users can log in to the Flipkart app, go to the categories tab and click on the ‘Live’ button. When they do so, they are taken to a section where live stream sales are routinely hosted across various categories, like fashion, home furnishings, kitchen tools, beauty and makeup, and electronics.
It makes sense that Flipkart chose to focus on these categories - the ones with maximum growth potential. According to a RedSeer report, the size of the live commerce market in India is expected to grow rapidly - reaching a gross merchandise value of $4-5 billion by 2025. The categories that are expected to contribute to this growth are beauty and personal care, and fashion.
Myntra (which is also owned by Flipkart) also has a play in the live commerce category. On Myntra’s app, there is a section titled M-Live (launched in 2021). Potential customers can access live videos by various influencers across various product categories.
Shankar Shinde - COO, VMLY&R COMMERCE points out that at present, short-form content is consumed by 215 million users monthly - which makes up 36% of India’s smartphone market. This is expected to rise to 600 million users over the next 3-4 years.
At the heart of most live commerce ventures, is the fact that the influencers endorsing these products, are believable and viewed as a credible source of information, when it comes to the categories they claim to be experts in.
“This growth trend indicates prevalent consumer and market interest in this emerging segment of content-led commerce experiences. Growing popularity of micro & nano influencer is going to be one of the key drivers of influencer marketing in a vast divergent country like India,” says Shinde.
Rohit Khanna, co-founder and COO of Eleve Media, explains why live commerce has so much growth potential. "Live stream shopping combines the convenience of instant purchasing of a featured product and the real-time engagement of audience participation through a chat function or reaction buttons," he says.
Sowmya Iyer, founder and CEO of DViO Digital, agrees and says that live commerce is a medium that makes the best use of social media, e-commerce and streaming technology, and enables real-time interaction.
Shinde quotes numbers to cement his point about the trust that influencers in the country enjoy today. “As per industry reports, 70% of teenage YouTube subscribers trust influencer opinions over traditional celebrities. 71% of consumers are more likely to make a purchase based on a social media reference,” he says.
“Since more people have moved to online platforms to satisfy their shopping needs, live commerce will gain traction and adoption,” adds Iyer.
Shinde adds that 86% of women turn to social networks before making a purchase and 86% of the most-viewed beauty videos on YouTube were made by influencers, compared to 14% by beauty brands, themselves. “57% of beauty and fashion companies use influencers as part of their marketing strategies. On average, businesses generate $6.50 for every $1 invested in influencer marketing,” he says.
Khanna points out that most Indian creators are comfortable about going live on video and creating branded content.
“As influencers start to overshadow traditional marketing campaigns, it will beget a revolutionary change, by driving accelerated conversions (with the correct attribution model), coupled with improving brand appeal and differentiation that unlocks an innovative shopping format and experience.”
Iyer says that merging both the worlds of content and commerce, is an inevitable move that brands can’t ignore.
“Live commerce is expected to boost influencer marketing business by making it more return on investment-driven,” she says.
Shinde argues that live commerce can potentially make shopping exciting and immersive, allowing users to interact with each other, build a community and have conversations. With further integration of innovations around commerce and social experiences like gamification, it could change shopping online from an activity to a form of entertainment.
Khanna touches on an important part of what makes live commerce different from other forms of online shopping - trust.
“Shopatainment (shopping+entertainment) is what really makes live stream shopping different. It can potentially shorten customer decision journeys from awareness to purchase. And, tactics such as one-off coupons, are also deployed. It can generate a sense of urgency too,” says Khanna.
Iyer equates live stream shopping to a friend recommending a product to buy. “Gen Z constantly seeks validation and reviews online. So, influencers are the perfect partners for brands. Live commerce is a potent channel for discovery commerce. It seamlessly integrates discovery commerce and influencer marketing to help build credibility as well as discovery of newer products,” she says.
Palkush Rai Chawla, director of product management, ShareChat & Moj, mentions, “One of the primary reasons social media apps are so popular, is because people want to watch relatable content. When content is scripted, edited multiple times, etc., people may not relate to it.”
When it comes to live stream, Chawla explains that the creator’s personality has an opportunity to shine - irrespective of what he is doing. A creator could be demonstrating a skill, performing an activity or just talking, but the people tend to relate to him more. The ability to interact with customers also helps the popularity of live streaming, Chawla adds.
Another aspect is that audiences see these creators as aspirational. The ability to interact with them directly via live streaming, contributes to the popularity of live streaming across different social media platforms. Chawla equates a content creator’s live stream to a fan meet up activity that a celebrity may conduct.
Iyer adds that these live interactions with influencers will be an eclectic experience for the audience and have a positive effect on their shopping decisions.
“It’s a win-win for both brands and influencers, where brands will have more control and be able to monitor the effectiveness of their association in real-time, and influencers can earn a commission.”
Chawla, however, acknowledges that live streaming and live stream shopping are still relatively nascent in India. “The ecosystem to support live commerce hasn’t matured in India yet. So far, live streaming has become popular in the gaming and entertainment spaces, and a lot of creators are still experimenting with it.”
However, he equates this medium of shopping and purchases to shopping in person.
“When you visit a store, a salesperson is explaining the product features and talking about its benefits, etc. During a live stream video, the influencer/content creator may perform a similar role. If a user sees the content creator actually using the product, it may help serve as a demonstration. This works when it comes to jewellery, clothes, makeup and beauty products, etc,” says Chawla.
Shinde meanwhile, says that live commerce isn’t an exact replica of the in-store shopping experience. “But in an economy where customer experience dictates a brand’s life cycle, it is best to reach shoppers on their own terms by giving best customer experience,” he says.
One of the biggest paradigm shifts, when it comes to online shopping, is that many products from the unorganised sector are now being sold online. This means that shoppers have more to choose from and influencers can help provide guidance to shoppers, when it comes to selecting these products to purchase.
Khanna ends with a touch of nostalgia. At the end of the day, India is familiar with the live shopping format. “We all grew up with Telebrands and Naaptol TV. If it’s done right, it can be one of the sought-after sources for web/mobile/app traffic.”
Shinde agrees, mentioning that the idea of selling products through video demonstrations dates back to the 1980s when Home Shopping Network appeared on US televisions. “Demos then were one-sided, new-age video shopping is live, allowing sellers and shoppers to interact with one another in real time. It shortens the discovery to awareness to conversion cycle,” he says.