How Brands Can Thrive By Going Live, Part 3: Three Ways to Win

This is the third article in our three-part series on ways that brands can leverage the rise of live commerce. In Part One, we explored why live-streaming matters and how to understand the platform landscape. In Part Two, we shared the pros and cons of different live-stream platforms across industries. Now, in Part Three below, we discuss the emerging best practices for live content with inspired examples from early leaders in the space.

Live commerce can be quite a conundrum for the modern brand. While it's projected to reach $55 billion in three years as Gen Z increasingly shops where they socialize – going live puts a lot of pressure on billion-dollar brands to get it right in real-time. One way to de-risk? Look at live commerce through the lens of what Gen Z loves most, TikTok. Some of the same traits that make great TikToks, make compelling commerce experiences. Livestreams that are entertaining, surprising, authentic, and even educational are on the right track.

With conversion rates up to 10 times higher than conventional ecommerce, the upside of live can go right to the bottom line. To succeed brands need to create a livestream strategy that embraces entertainment, leverages scarcity, and adds value at scale.

Use entertainment to drive engagement

Livestreams offer a way to create shared moments around what your customers love and are most interested in. Something Petco clearly understands. In "The Perfect Fit," the brand’s first-ever livestream event, pet fashion was modeled by rescue dogs up for adoption. Sales drove a 2x return on investment and sparked a 12% rise in website traffic. Their next livestream, “Petco Field Day,” was hosted by former Olympian Gabby Douglas and Petco National Dog Training Manager Darris Cooper. With demonstrations, educational content, and the much-loved “live hamster ball racing” the event reached 2.43 million viewers, boosting brand favorability and product recommendations. 

As we’ve previously written, some livestreams are combining two of Gen Z's favorite things (gaming and shopping), in compelling ways. Chipotle, for example, selected people who commented “Freepotle” on the brand’s TikTok and Instagram Live feeds and gave them a chance to win free Chipotle for a year with a spin of the Freepotle Prize Wheel.

Embrace scarcity to fuel FOMO

As any streetwear or luxury brand would attest, scarcity drives demand. Live commerce is no different. In fact, livestreaming marketplaces like WhatNot and NTWRK have built their business on it. To fuel FOMO, WhatNot is adopting an auction model to maximize revenue and boost hype for sales of rare items from sports cards to second-hand luxury pieces. Top sellers on the platform are earning up to eight figures a year, with over 100 hosts each making nearly $1 million in 2022.

Livestreams on NTWRK have become launching pads for limited edition collaborations for brands like BMW which released a merchandise line with Pharrell Williams' Billionaire Boys Club brand celebrating their new Mini Electric car. Just this week, makeup brand e.l.f is hosting a livestream on NTWRK to drop their limited-edition e.l.f. x American Eagle collection, their first-ever fashion collaboration, and American Eagle’s first beauty collaboration. 

Educate to add value at scale

Livestreams can leverage the love consumers have for a brand’s category through content like Q&A sessions and deep tutorials from product experts. Lowe’s, for example, launched DIY-U by Lowe’s, a home improvement platform featuring live and on-demand educational resources. The monthly livestreams are limited to 1,000 participants each delivering intimacy at scale by allowing viewers to ask questions and purchase related products.

Specialty food retailer The Fresh Market uses livestreaming to double down on what its customers are most passionate about – food. In 2022 the brand launched a series of shoppable livestream events for the holidays. In one livestream, celebrity chef host Anna Rossi taught over 800k viewers how to prepare the ultimate holiday meal where they could purchase individual ingredients or everything needed for the entire meal in one click. According to Fresh Market Chief Marketing Officer Kevin Miller,  “the combined viewership of the first four live streams exceeded 2 million views and generated conversion rates 300% greater than our traditional digital advertising results.” Most recently, the brand launched a similar strategy for Easter 2023.

Clearly, live commerce is in its early days and represents an innovation opportunity for brands willing to experiment. Given its fast growth, high conversion rates, ability to create compelling shared moments, and appeal amongst Gen Z, brands that get it right will have a substantial lead as adoption accelerates.

To learn more about live shopping watch the CNBC deep dive here, featuring our Founder, Quynh Mai.