Why China’s tech chieftains have become live-streaming stars

The live-streaming video market saw strong household and corporate demand during China’s coronavirus lockdownChina is forecast to have 526 million live-streaming video users this year, up from 504 million in 2019

A few years ago, many people thought the party could soon be over for China’s live-streaming video industry, as the tens of millions of yuan a year paid out to top presenters becomes unsustainable amid a decline in online viewer numbers.

The industry, however, has continued its rapid growth because of the integration of live-streaming video features with various e-commerce and entertainment platforms, and more recently, strong household and corporate demand during China’s coronavirus lockdown.

In the middle of this spectacular boom, a number of mainland China’s tech industry leaders and entrepreneurs have also become live-streaming stars, eager to cater to the vigorous appetite for online shopping in the world’s second largest economy.

“Live-streaming in e-commerce is a very innovative model that enables interaction and participation of users,” said Zhang Dingding, an internet industry commentator and former head of Beijing-based research firm Sootoo Institute. “That interaction, in turn, can drive up transactions to some extent.”

Alibaba Group Holding founder Jack Ma, for example, was one of the first major tech industry leaders to make a big splash in China’s live-streaming video market in 2018, when he did a campaign on Taobao Marketplace. Taobao, China’s biggest online retail platform, is a subsidiary of Alibaba, parent company of the South China Morning Post.

Ma took part in a one-on-one competition against professional live-streamer Austin Li Jiaqi over who could sell more lipsticks on Taobao Live, the Alibaba retail platform’s marketing channel.

Their widely viewed match, also seen on Alibaba-owned streaming video platform Youku, was easily won by Li, who has gained popularity as China’s “Lipstick King” since he started doing streaming videos almost everyday on Taobao in 2017. He once sold 15,000 lipsticks in just five minutes on Taobao Live.INSIDE CHINA TECH NEWSLETTERGet updates direct to your inboxSUBSCRIBEBy registering, you agree to our T&C and Privacy Policy

Last year, Ma did another live-streaming video campaign for farm produce with Taobao’s top live-streaming broadcaster, the former singer Wei Ya.

Trip.com Group, China’s largest online travel services provider, has cultivated its own live-streaming star in co-founder and executive chairman James Liang Jianzhang. On his live-streamed video campaigns, Liang wears ancient Chinese clothing, known as hanfu, to pitch hotel room bookings with the Nasdaq-listed Trip.com, formerly known as Ctrip.com International.

James Liang Jianzhang, executive chairman of Trip.com Group, dons traditional Chinese clothing on his live-streamed video campaigns for China’s largest online travel services provider. Photo: HandoutIn one of Liang’s hour-long live streams via Trip.com’s mini app on WeChat, he broadcast to an online audience of about 610,000 and generated 20 million yuan (US$2.8 million) in sales. This effort from Liang has provided a much-needed boost for his company, which has also been affected by the pandemic’s impact on the global travel market.Charles Zhang Chaoyang, the founder, chairman and chief executive of Sohu.com, said he was itching to try live streaming like his peers in China’s tech industry. He described himself as “very optimistic’ over the opportunities in live-streaming e-commerce.

Sohu launched an unsuccessful live-streaming service Qianfan in 2016, when the industry seemed to have reached its peak. The number of live-streaming platforms at that time grew to more than 100, but monthly active viewers were in decline, according to market intelligence firm iResearch.

Chinese tech entrepreneur Luo Yonghao, founder of smartphone company Smartisan Technology, generated sales worth US$15.5 million in his recent debut as a live-streaming pitchman for a range of goods. Photo: DouyinLuo Yonghao, whose failing smartphone venture Smartisan left him bankrupt last year, took a shot at redemption when his three-hour live-streamed campaigns on ByteDance’s popular short video app Douyin, the Chinese version of TikTok, became a viral hit.He sold 110 million yuan worth of products on April 1, when about 48 million Douyin users tuned in. He was joined in the live streamed campaign by Wang Xiaochuan, founder and chief executive of online search firm Sogou, who pitched his artificial intelligence-based voice recorders.On Luo’s next live-streamed campaign on April 10, the reception was softer with about 35 million yuan in sales and around 11 million viewers, according to data provider newrank.cn.

These developments in China’s live-streaming video market show the potential of how fast the tech industry can recover, following the broad economic slowdown caused by the coronavirus crisis.

With e-commerce and entertainment helping spur increased adoption, the total number of live-streaming video users in China is projected to reach 526 million this year, up from 504 million in 2019, according to iiMedia Research.

“The popularity of live-streaming was already strong before the pandemic, but the [coronavirus] lockdowns moved it up another notch,” said Mark Tanner, founder and managing director of Shanghai-based consultancy China Skinny. “I expect its popularity will continue beyond the pandemic. Still, a drop from its peak is expected because Chinese consumers will have less idle time [in future].”

The stakes are also high for China’s major tech players in live-streaming video services, including Alibaba, Tencent and ByteDance. The industry’s size is predicted to surpass 900 billion yuan this year, according to iiMedia, as China remains the world’s largest internet and smartphone market.

While tech industry leaders taking part in live-streaming video campaigns may offer less novelty than professional streamers, the “shoppertainment” trend is blurring those boundaries.

“This model will continue to grow rapidly and become the new growth engine for China’s e-commerce industry and even the new digital economy,” said analyst Zhang. “The market is inclusive and big enough for a lot of participants.”

Originally Publish at: https://www.scmp.com/

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