5 Golden Rules to Rule Live Shopping
Inmy MBA thesis ten years ago, I envisioned a world where brands would createspaces – some in the middle of nowhere! – and make them look like theirflagship stores… only to sell to online audiences through live shopping, 24hours a day 7 days a week.
You can imagine the look on my professor’s face back then.
Fast forward to today: my co-founder and I have been collaborating with brands of all sizes for the past four years, helping them embrace the reality of live and social shopping today. We’ve watched shoppers from age 17 to 70 tune in to live shopping channels, and we listened to their feedback and iterated until our live and social shopping solutions at LiSA, became the high-demand products they are today serving major brands like Avon, L’Oréal and Marks & Spencer.
What we’ve found is that different audiences crave different types of content and experiences. However, there are five rules that represent the universal truths when it comes to the key success factors for brands launching live and social shopping.
Here they are:
1. Live Shopping is NOT Home Shopping TV
Those of us in Western countries grew up with the appeal of Home Shopping channels on TV: QVC, HSN, ShopHQ – the classics. So, it’s not a surprise that when we explain what live and social shopping is to people, the closest branch our clients and consumers grab on to is: “oh, like QVC!” I mean, certain elements are similar, right? You have someone presenting a product live and you have can purchase the products “directly”, albeit via phone.
When we present LiSA to potential new clients and they reference the “home shopping but online” it sets off an avalanche of false assumptions. The danger of this comparison is that it prevents people from being forward-thinking and understanding the true ingredients for success in live and social commerce today.
First, there’s the immediate assumption that to “produce” live shopping content, you need a similar set-up to Home Shopping TV: a big studio, lots of cameras, a big camera team, professionally trained hosts, scripted content… you get the picture. Investing into such production can also make a brand feel “safe” and “more in control.” This is understandable given how much time and energy brands have invested in carefully crafting their public image and messaging on traditional channels and marketing.
What we’ve found is that this extravagant set-up is the exact opposite of what your customers crave. Trust me, we’ve been observing and collecting unfiltered feedback from your shoppers for years now, and we can say this is a fact.
So what do your customers want? Simple: authenticity.
Did you know that while 92% of marketers think they are creating authentic content, only 51% of consumers think their favorite
brands offer authenticity?
Now for some good news: there are ways in which your brand can marry your desire for professional-looking experiences with your audience’s desire for authenticity.
You’ll find that you can create great and effective live show set-ups for a fraction of the initially assumed costs. You’ll also have a plethora of great live hosts to choose from in your community that know exactly how to make your brand shine the way you want it to. On top of this, there are style templates and review mechanisms within our LiSA tool which help you to allow your live creator content to grow at their pace – while helping your brand achieve your objectives.
2. Authenticity and Relevance Leads to Engagement and Sales
Finding success with live and social shopping will only work if you approach your activities in this order, and this order only!
We’ve seen it all: brands that start with optimizing for sales, and suddenly the team is selling top products at insane rebates just to “prove it works.”
If you start with optimizing for engagement alone, you’ll have great interaction, but are still likely to be missing out on your true potential of being actually relevant to your audience.
Step 1: Build Authenticity and Relevance
Different target customers will love different topics, show formats, presenters… the superpower of live shopping is that at very low upfront production costs (if any!), you can offer highly relevant content to even the tiniest of target groups.
While many brands begin by streaming large special events to as large an audience as they possibly can reach, many also then find that live shopping actually allows them to be much more granular and thus relevant to their niche audiences.
So, how can you make sure you’re being relevant? There are three things we suggest to look out for:
- How are average dwell times developing?
- How much are social sharing buttons being used? (LiSA customers see up to 43% in audience shares!)
- Ask your audience: launch a quick and easy survey which you can link directly through LiSA to get a pulse on what your audience is thinking and feeling
Being authentic is about listening to your audience – and creating content that’s actually relevant to them. After that? You’ll have their attention.
Step 2: Spark Engagement
Once you’ve learned which target group is into which topics, formats, hosts, etc. it’s time to boost engagement rates. There are many fun ways in which you can entice your live audiences to become active participants.
For example, your live hosts can engage the audience with ice-breaker questions to share on the chat, such as:
- Where is everybody joining from today?
- Ask the audience a question related to a story they’re telling. If the host is telling a story about their pets, they can ask the audience: what is your pet’s name?
Or, they can ask questions relating to the content of the show, such as:
- Do you know when our brand was founded?
- Who knows what the three active ingredients are in our signature cream?
You can also use the product carousel to add content elements which takes the audience to wherever you want them to, such as a newsletter sign-up, a prize draw, or other calls-to-action.
Finally, you can use LiSA’s fun polls and quizzes features to get a pulse and even invite the audience to participate in the creation of the show with questions such as: “shall I (the live host) show you the smartphone or the tablet next?” or “Do you prefer outfit 1 or 2?”
Step 3: Enjoy the Viral Sales
Only after mastering steps one and two will you become a grand master of conversion and sales. Some of the brands we work with reach conversion rates of up to 35%.
I often get asked about offering special discounts through live shopping. When used regularly, this tactic bears the risk that audiences might get trained into thinking that when they come to your live shopping shows, they’ll get special deals.
First, this can hinder your ability to make live shopping a truly special experience for your customers. Second, we’ve found that brands who over-use discounts mostly attract bargain hunters instead of serious shoppers. Brands get into live shopping hoping to build relationships and strengthen loyalty with their shoppers, which leads to increased purchase frequency and average order values. The overuse of rebates is not an effective mechanism to achieve this.
So, what can you do to incentivize purchases? Some brands like to add some limited edition products to their selection. Others work with product sets or bundles which are also limited time offers. Or, you can offer a special gift which only gets sent with orders from the live show.
Live shows are a great way to show people how different products complement each other, be it matching gadgets, a skincare series, an outfit, a starter set for someone wanting to go camping – customers love to understand the cohesiveness of your offerings, and how they can improve their lives.
3. Test. Learn. Repeat.
Something we see often is that brands “settle in” after one or two live shopping formats once they’ve tested well with audiences. After just a few shows, they set up a production plan for the months to come using the same formats, hosts, and setups.
While we’re thrilled that this means brands are making live shopping a regular habit, the results that these brands have pale in comparison to those of brands that constantly experiment with their formula, hosts, and live show ideas.
Brands that are open to experimentation discover the wildest things about what actually works for their audiences. In almost all of these cases, it is not what the teams initially expected would perform well.
So, how can you systematically be aware of the underlying (often false) assumptions a team has going into live shopping, and how can you set expectations to experiment and iterate until you’ve found a live shopping experience that works for your respective target group?
Thankfully, if you apply the concepts of design thinking when creating your trial phase, you can set your team up for success.
For brands that would like help, the expert team at LiSA offers workshops to design trial phases to help you learn which live shopping strategy will go viral and change the way you do live shopping – forever.
4. Less (Audience) is More (Engagement and Conversion)
20 Shows x 200 Viewers > 1 Show x 4,000 Viewers
Yes, I am very much aware that mathematically the two may seem the same. Both sets of shows have 4,000 viewers, but the reality of live shopping is that the scale is tilted to one side when it comes to achieving the results you’re looking for.
As mentioned earlier, many brands we work with tend to equate live shopping with TV shopping or other marketing activities in their company, such as classic video campaigns. As a result, they often project the same key goals onto live shopping – namely, to maximize views.
For those that prefer numbers, here goes a numerical example to illustrate my point:
1 show, as a special event with high production costs, maximized for audience attendance.
- Production costs:
- Studio: €3K
- Equipment/Gear: €3K
- Professional hosts: €2K
- Advertising costs: 1€/viewer
- Conversion rate : 7%
- AOV : €50
- 4.000 viewers
TOTAL COSTS = €12,000
TOTAL REVENUE = €14,000
GROSS PROFIT = €2,000
20 shows run by creators, 200 viewers per show, maximized for relevance and engagement.
- Production costs: €0 (creators self-produce)
- Costs for hosts : Creators get 5% share of sales
- Advertising costs: €0.20 / viewer (direct activation only, no big campaigns)
- Conversion rate : 10% ( higher relevance → higher engagement → higher conversion)
- AOV : €60 (better “quality” of audience → higher AOVs)
- 20 shows x 200 viewers
TOTAL COSTS = €2,000 (€800 Ad X, €1.200 creator commission)
TOTAL REVENUE = € 24,000
GROSS PROFIT = € 22,000
Successful live shopping actually lives from scaling the number of shows by letting many creators run live shows constantly (ultimately, “always on” is the goal) and matching these shows with the right audience, not necessarily the largest.
It’s always better to create a wide net that includes a variety of shows with moderate audiences (20 shows with 200 viewers) compared to a show with a large audience (1 show with 4,000 viewers) for another key reason: specificity.
Each demo you can sell to, like I mentioned earlier, has their own specific tastes for how they like being sold things – and who is doing the selling!
For instance, First Insight found that 62% of Gen Z shoppers prefer to buy from sustainable brands as opposed to the 38% of their Baby Boomer counterparts. If your target market includes both Gen Z and Boomer shoppers, you’re going to want to think of a different approach when talking to those different demographics.
Our varied suite of tools makes it easy to A/B test different live shopping styles before committing to the most effective one for different skews.
LiSA Pop is a product of ours that allows brands to book existing shopping channels for upcoming events. What that means is that you can try a variety of different channels and find the one that converts the most for your audience and product.
LiSA Dazzle allows you to embed a channel directly onto your website, and with its automated widgets you can target different groups with live showsdifferent landing pages and truly capture all the leads that dazzles a consumer from first click to checkout.
LiSA Shine allows you to create an unlimited amount of live shopping channels and give individual creators direct access. Welcome to a truly decentralized (yet controlled), community-led content creation approach - hosted on your own website!
5. Your Community is Your Best Source of Content
People listen to other people: that’s why testimonials and user-generated content are so powerful.
At the beginning of any brand’s live shopping journey is the search for those “faces” of their brand. In fact, many retailers view finding sufficient live host talent as a highly limiting factor.
What’s fascinating is that almost every single customer we’ve worked with ends up being blown away with the talent already available within their own community.
Here’s where to look:
1. Your Buyers and Category Specialists
You’d be surprised how much real value people with deep product and brand expertise can bring to live shopping audiences. Different from the “influencers for hire,” these people really know the details about what makes a product great, and audiences love to learn from them.
2. Your Top In-Store Staff or Customer Service Staff
We’ve seen multiple examples of retail staff and personal shoppers hosting regular VIP live shopping shows, or department managers curating and hosting weekly live edits. We’ve even seen individual stores launch their own live shopping channels through a retailer’s website (powered by LiSA SHINE) and saw a fun competitive dynamic break out. Though many brands start off with a careful approach by pre-curating and scripting such live show content, usually, within a few weeks they “let go” and let their staff members run the show. At this point, there is almost always a spike in engagement rates, dwell times, and sales. Trust the people who are “boots on the ground” with your products and brand!
3. Key Opinion Customers or Micro-Influencers
Micro-Influencers already create great content on other channels, so why not tap their talent? As a brand, you may have noticed that you have some very strong advocates that regularly do hauls or reviews of your products, or even create full “how to” tutorials using your products on different social media channels. Why not leverage the authentic and great content your fans are already creating by inviting them to host their own live shopping channel on your website, and perhaps incentivize them through a sales commission? This is how Chinese e-retailers have managed to build in-house influencers by the thousands. No wonder live shopping makes up 20% of all e-commerce over there.
4. Larger, Established Influencers
In order to bring more awareness and more easily lure audiences away from social channels and onto your live shopping channels, collaboration with influencers that have a large reach can have a great one-off lift effect. The only thing we’ve noticed is that many of the larger, more established influencers are likely to prefer to continue being paid on a content basis instead of commission-only, and that they likely prefer keeping their audience on their platforms of choice, not yours.
In the long run, it’s much more lucrative to build your own league of in-house creators. It also helps build loyalty within your community by investing in your fans’ love of your brand.
Ultimately, we see brands and e-retailers evolving through a very similar learning curve when it comes to managing their own live shopping activities. For this reason, at LiSA, we have decided to not only create a product portfolio which really supports you at every step of this exploration, but lead you through a curated support package every step of the way.
Unlike our competitors, we know that one size does not fit all. Your live shopping solution will need to evolve as you do.
Ready to say hello to a more authentic way to sell? Get in touch with a LiSA team member today and we’ll help you put these five golden rules into action tomorrow:
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