livestreaming to play bigger role in chinas post covid 19 economy - Livestreaming to play bigger role in China's post-Covid-19 economy

The first shoots of the Chinese mahogany tree, or xiangchun, look just like red spinach, but are crisp and have an earthy, onion-like aroma.

They are a springtime delicacy in northern China – so when entrepreneur Xu Zewei heard hundreds of kilograms of the prized seasonal vegetable would go to waste because of Covid-19, he sprang into action.

The 37-year-old went on livestreaming platform Kuaishou earlier this month to hawk the vegetable, grown by farmers in the Dazhuangke township on the outskirts of Beijing.

He sold out the town’s xiangchun – all 564kg worth – just 10 minutes into an hour-long broadcast that was watched by 81,000 people, at prices similar to last spring.

Mr Xu is among a growing number of Chinese – from rural farmers to brand-name retailers, even Communist Party officials – who have turned to livestreaming platforms in the past months as brick-and-mortar stores were closed and people stayed home because of Covid-19.

They hawk everything from oranges to lipstick on their shows, which can draw hundreds of thousands of viewers and generate millions of yuan in sales.

Experts say livestreaming – once a niche sales channel – will become a larger part of the consumer market in China’s post-Covid-19 new normal.

Commerce Ministry figures show there were some four million livestreaming e-commerce broadcasts in the first quarter of this year.

Mr Xu, who runs data services firm 91TechGroup, puts down his success to working with Kuaishou, which helped promote the broadcast on its platform.

During the show, he took viewers through the nutritional qualities of xiangchun and showed how it could be prepared – stir fried with eggs, eaten with tofu, or battered and then deep fried until it resembles crispy whitebait.

“The results were quite good, but it’s very tiring. You have to think of all the different ways to promote your product,” he told The Straits Times.

He got to helping the farmers in Dazhuangke because he runs a “red tourism” site there popular with people who visit places of historical significance to communism in China.

But the site was closed because of the coronavirus outbreak, leaving farmers in the area, who depend on the “tens of thousands of visitors” who come each year to sell their produce to, without any customers.

“Xiangchun is something that you can’t keep; you have to eat or sell it soon after you harvest. That’s why I thought of selling it using livestreaming,” he said.

The number of users of livestreaming services in China has been rising steadily in the last five years, according to Chinese market intelligence firm iiMedia Research.

It grew to 504 million last year, increasing by 10.6 per cent from the year before. This figure is expected to rise to reach 526 million this year.

Experts say Covid-19 has accelerated this rise. Apart from Kuaishou, other livestreaming platforms include Douyin, JD Live and Taobao Live.

Mr Zhang Guowei, head of livestreaming business of e-commerce platform, said he has seen sales generated from livestreaming grow to about a tenth of all e-commerce sales.

“The epidemic is devastating brick-and-mortar stores, but it also brings opportunities… We have seen an increasing number of brands doing livestreaming on JD this year, especially the big ones,” he said.

Livestreaming has also proven to be a boon for rural farmers, helping to connect them to urban consumers amid disruption caused by Covid-19, said Taobao’s senior director of e-commerce content Yu Feng.

Alibaba, which owns Taobao, has an ongoing initiative that aims to teach 200,000 farmers to sell their products on Taobao Live. The goal is to drive sales of up to 15 billion yuan (S$3 billion), he said.

Ms Kitty Fok, managing director of research firm IDC China, said livestreaming will become a fixture of e-commerce in the post-pandemic landscape.

“Consumers now want a contactless experience because of the pandemic, and with livestreaming, you also get that interactive experience… E-commerce is not going to go back to what it was before,” she said.

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