Live streaming in China has revolutionized the digital landscape in recent years. This growth increased with the lockdown due to the Coronavirus emergency. Live streaming has become a real mass phenomenon, exploited widely by brands and KOLs (Key Opinion Leaders). So let’s see how it can also be used by international companies to promote and sell products effectively Beyond the Wall.
Size of live streaming in China
According to a recent study by the China Internet Network Information Center, the number of live streaming users in China has experienced continuous growth in recent years. This is especially evident when comparing 2019 with 2020. Looking at the numbers, the popularity of live streaming among Chinese users is evident. If in the first half of 2019 about 433 million people watched live streamings. In the same periodo of 2020 there were 562 million. Not to mention that by the end of 2020 it grew again up to 616 million. This figure is even more remarkable when compared to the total population of China, which numbers 1.4 billion individuals. Almost half of the Chinese, therefore, are accustomed to enjoying live content on the various platforms available Beyond the Wall. The exponential growth of Beyond the Wall live streaming coincided with the outbreak of the Covid-19 pandemic. The health emergency was thus the trigger that accelerated and made more urgent the solidification of a trend that was itself already present and evolving.
Moreover, according to data published by eMarketer, in 2021 sales generated by the live streaming market in China are expected to reach a value of RMB 850 billion. This corresponds to approximately $131 billion. Of course, as mentioned earlier, one of the biggest drivers for the expansion of live streaming in recent months has been the Coronavirus. Since the lockdown, in fact, even brands that previously did not use it have begun to use this format more. Live streaming, in fact, has become indispensable for maintaining direct contact with customers.
Key Opinion Leader
But who are the hosts of live streaming? Many are regular users who use this format to report on everyday life, tell jokes, make makeup tutorials or give advice on clothing choices. However, these individuals have few followers. Some of them, on the other hand, have gradually gained enough fame to make it a full-time job. They are web personalities and their reviews are followed by millions of followers seeking advice. Also, they may be classic celebrities, such as actors, singers, and entertainers. Nowadays it is normal to have also virtual idols, figures created by technology with human likenesses and incredibly realistic, as in the case of Ayayi.
Key Opinion Leaders are now the driving forces in the Chinese digital market. Their live feeds are followed by thousands or even millions of users. Take the example of the very famous KOL Viya. During the last 618 Shopping Festival in June she reached nearly 23 million views. Thanks to this, it managed to generate sales of various kinds of products for a total of RMB 2 billion.
KOL Viya prepares for live streaming in her studio. Source: E-commerce News.
Selling through KOLs and live streaming in China
There are many reasons why live streaming is having such success in the Dragon Country. Basically, they are all related to the possibility of selling products. When the sale takes place during live streaming, it is called live commerce. Users are stimulated to immediately buy what they see sponsored by the KOLs and are directed to purchase in-App. Usually the decision to finalize the purchase is made in a few seconds, so this sales mode works best with low-to-medium priced products. In fact, they do not require lengthy consumer evaluations.
Even if the streaming platform were not to offer in-app purchase, a feature that is being rolled out anyway, live streams can be a great ally to sales. In fact, through live streaming KOLs carry out an important content marketing and lead generation activity. This activity is targeted to the products of brands on Chinese e-commerce. Think of the connection between the Taobao Live or Douyin live streaming apps and the Tmall marketplace. Key Opinion Leaders describe the products live. They then provide a link that points directly to the product page on the e-commerce platform to complete the purchase.
Laws and future developments
With live streaming, the potential and reach of KOLs can only grow. It is therefore virtually certain that live streaming will become an increasingly integral part of influencer marketing. This is precisely why the Chinese authorities decided to issue a set of regulations for live streaming in China. Indeed, fears were beginning to spread that live streams were being used to sell substandard products or for fraudulent activities. We list some of the most relevant points contained in the document drafted by the China Advertising Association. Indeed, these laws went into effect on July 1, 2020.
– Live streamers must give accurate, truthful and complete descriptions of the products or services they sell.
– Marketing data provided by KOLs to the brands that engaged them and to the platform must be real and not distorted.
– Vulgar content, misleading advertising, and any type of communication that may be misleading to the public are prohibited.
– Live streaming platforms must provide training for hosts.
Given the popularity of the live streaming phenomenon, the Chinese Ministry of Commerce then made a further regulatory proposal in August 2021. This goes on to outline further guidelines of the live-streaming industry such as:
– Greater strictness on the dress code of live-streamers, whose image must not violate public order and morals.
– A requirement to speak Mandarin Chinese during live-streams. This therefore goes to exclude not only foreign languages, but also the many Chinese dialects.
– The requirement for live-streamers to be over the age of 16.
– A ban on the sale of certain types of products, including medicines, spy devices, erotic games and foreign newspapers.
The proposal will be under public review until September 2, 2021.
Opportunities for international brands
The very fact that it was necessary to establish these standards indicates how impactful live streaming is considered in the Dragon Country. This is why international brands working in the Chinese market cannot ignore this tool. In the future, live streams will be increasingly crucial to stimulate and drive sales of their products. Even better if the chosen digital strategy includes collaboration with a Key Opinion Leader, who-as we have seen-has the power to greatly multiply user conversions.
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