App-based feeds get a life of their own

I've previously written about the huge potential and vitality of livestreaming and how it is moving away from an obscure role in promoting online sales to taking a center stage in social-commerce in China.

The industry now faces an unprecedented growth opportunity as the country's top leader praised online shopping as an effective vehicle for promoting agricultural produce, and livestreaming is arguably among the most trending practices in the digital shopping realm.

During a tour of Zhashui county, Shaanxi province, on April 20, President Xi Jinping had a brief chat with a group of merchants who were using livestreaming to market muer, or "wood ear", a popular black fungus. China Central Television's official account on Douyin, a leading short video platform in China, showed Xi saying that "E-commerce is very important in promoting agricultural products and has a big role to play."

Li Xuying, a Taobao host, said some 420,000 users recently swarmed to her virtual showroom and snapped up all her muer inventory. Data from Taobao, the e-commerce platform, showed that the shop recorded on average one order per second for the fungus on April 21.

Local governments are taking the marketing platform seriously, with livestreaming becoming a central plank driving a massive consumption campaign, dubbed "May 5 Shopping Festival", in Shanghai. Traditional retailer Bailian, customer review and group-buying site Meituan Dianping and international brands like L'Oreal are employing online hosts as a magnet to attract eyeballs and open wallets. On China Brand Day, which falls on Sunday this year, livestreaming is poised to play an even bigger role, according to briefings from Shanghai authorities. They said the city is largely a barometer of avant-garde shopping trends in China, and they expect to see livestreaming becoming the next new normal.

It's foreseeable that Chinese e-commerce platforms, which are already pioneering some of the best practices in online-to-offline shopping, are poised to fully capitalize on livestreaming. A quick look at major players and their respective edges shows the following.

Taobao Live began nurturing online hosts back in 2015. Taobao is backed by Alibaba Group, a gigantic, mature e-commerce ecosystem that makes the "traffic-to-transaction" loop rather smooth and natural. A lot of major brands are already on Taobao or its sister app Tmall, which targets more upscale brands, so the cost of setup on Taobao is almost negligible.

Douyin, part of Bytedance, recently became rather vocal about its ambition to help smaller merchants sell by employing short videos and promoting its livestreaming functionalities. There are countless promotional ads on Douyin's newly-unveiled services. They offer suggestions on short-video shooting, product selection and a range of on-the-ground services. As a latecomer, Douyin's livestreaming sessions are still working to boost online spectators and quality. So much more could be done on the livestreaming end, but Douyin is a go-to-platform for short videos in China.

Pinduoduo, a high-flying e-commerce site, has garnered nearly 600 million users so far－a rather staggering figure considering its establishment just five years ago. It started out as a platform for bulk-selling agricultural products and other non-big-ticket items at reasonable prices. By inviting your social contacts to also use the same app, you stand to enjoy further discounts. That's perhaps one way it has garnered such a huge user base in a relatively short period. The recent wave of supportive policies could be a huge plus for Pinduoduo as it is a marketplace already synonymous with peddling agricultural goods and local specialties in the eyes of many consumers. Pinduoduo is unlikely to attract high-profile key opinion leaders in the online influencer arena, but it's likely to invite government officials to livestreaming sessions, promote local specialties, increase sales and boost employment. Therefore its lack of socially-savvy presentation skills might not be too much of a downside.

Of course, there are a number of other platforms such as Xiaohongshu and Kuaishou that are also in the livestreaming game. But as livestreaming helps the central authorities with the "six safeguards" that help in the coronavirus recovery－of which ensuring basic livelihoods and employment are prioritized－it could help drive merchandise sales, create job opportunities and mobilize people to consume again.