Consumer Sentiment Towards Livestreaming is Changing: What Does This Mean for Luxury Brands?

If you've watched livestreams on Douyin or TaoBao or during any of the shopping festival dates in China, you would've felt pressured to buy because it always seemed like the hosts were yelling at you to buy. Deals were announced with quantity and time limits and this pushed consumers to new limits with their online spending (it also translates into higher returns when they experience buyers' remorse).

Over the past 5 years, the gross merchandise value brought in via this popular sales channel has exceeded the expectations of many people. Just take a look at the chart below. Clearly, the channel will remain an important way for brands to connect with consumers but with interest waning from shoppers for livestream hosts that just scream 'buy, buy, buy' at the top of their lungs, how can brands connect in an authentic and effective way?

There's one reason why slow living content and down-to-earth bloggers and vloggers are gaining traction with Chinese shoppers, it's because consumers are tired of the fast paced hard sell that was prevalent in the past.

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GMV from livestreams have gone up a hundred fold over the past 5 years from $3 Billion to over $300 Billion.

Platforms like Xiaohongshu (aka Little Red Book or RED) have been advocating authentic content sharing and cracking down on wealth flaunting to make social networks a less anxiety-inducing space.

Companies have been looking to cash in on this trend of minimalist, pared back style of live streaming; where Livestream hosts used to be heavily made up and vocal, the up-and-coming Livestream hosts look much more like the guy and girl next door, making live stream viewers feel more at ease that they aren't being fed instant promos.

One such company is Oriental Select (东方甄选), a relatively new live streaming company owned by private education giant New Oriental (新东方). After a slow pick up, the platform now has more than $29.9M USD in sales since the beginning of June, with daily sales skyrocketing from $112K to $9.4M in just 10 days.

If you're been following our social media, you would have seen our updates on new restrictions and regulations for various Chinese social media platforms and industries (beauty, fashion, real estate, etc.) The regulations were enacted to urge Livestream hosts to stop wealth flaunting, comparison and promoting money worship, so the new trend of educational and low-key livestreams aligns with this progression in the sector.

How is this applicable to your business?

1. Use believable hosts. If you're in the beauty business, take a page from the Dove model - all skin is beautiful. Work with Livestream hosts that show their natural skin and appear like a 'real person' instead of heavily filtered, made-up faces. The host should be perceived as a regular user, with their own skincare struggles so they are more down-to-earth and relatable to the end-user.

2. Share knowledge instead of limited-time offers. Instead of pushing how the promotions are really good right now and how many promotional gifts or gift sets shoppers can get if they buy right now, focus on sharing the actual benefits of the products. If it's skincare, spend most of the time demonstrating the efficacy of the products, diving in-depth into the ingredients and their impact on the skin, and so on.

3. Train your Livestream hosts so their delivery doesn't drive up anxiety. Livestreaming used to be loud and pushy, almost as if you'd walked into a real-life sales trap (you know those ones that follow you around the store and say everything looks good on you), but the new age of live streaming should be something people want to watch to soothe and relax their minds, which is why New Oriental's educational, bi-lingual live streams featuring approachable hosts has found success.

Try out these 3 tips to see if you can improve the performance of your livestreams!