蓝皮书系列：中国直播电商市场发展报告

Blue Book of China’s Commercial Sector:Annual Report on China’s Commercial Sector(2021-2022) Introduction In recent years, livestreaming e-commerce has attracted consumers’ attentionthrough more vivid and lively product demonstrations and interactive shopping Online shopping surged during the pandemic and therefore many traditionalbusinesses moved or expanded their operations online, which has furtherdriven the development of livestreaming e-commerce. According to data fromthe Ministry of Commerce, in 2020, China’s major e-commerce platforms have This report presents an overview of the recent developments of thelivestreaming e-commerce market, introduces the current industry landscape The content in this report is based on the Chinese article published in the BlueBook of China’s Commercial Sector (2021-2022). Contents I.Overview of Livestreaming E-commerce 1.What is Livestreaming E-commerce?2.The History of Livestreaming E-commerce II.Livestreaming E-commerce Ecosystem 1.ValueChain2.Key Platforms and Business Model III.Livestreaming as a Marketing and Sales Channel for Brands and RetailersIV.The Future of Livestreaming E-commerce I.Overview of Livestreaming What is Livestreaming E-commerce? Livestreaming e-commerce is a business model in which hosts promote and sell products or services through a livevideo stream. The host can interact with their audience and answer product-related questions. Livestreaming E-commerce: How it Started? The livestreaming e-commerce model originated from two types of platforms: •E-commerce platforms had been continuously upgrading their product display pages. They found live broadcastsprovide a warmer andmore interactive shopping experience that gained popularity with consumers. The most prominent example of this business modelisTaobaoLive. •Content creators on short-video platforms such asDouyinand Kuaishou and KOLs on shopping communities such asXiaohongshu(RED)andMogujiebegan connecting with third-party e-commerce platforms to monetize their traffic through livestreaming e-commerce. The History of Livestreaming E-commerce Exploratory phase(2016-2017):Various platforms (Taobao, JD.com andMogujie) began testing out livestreaming e-commerce. Growth phase(2018-2020):An increasing number of platforms joined the industry, using steep discounts to drive consumer demands. This momentum was supported by the growth of the domesticeconomy,as well as the rise of smartphones and better Internet infrastructure. Some local governments enacted support policies to further support the industry. In early 2020, the COVID-19pandemic became a catalyst for livestreaming e-commerce, as offline stores turned to livestreaming to save their business. Regulated phase(2020-):Industry standards and guidelines have been implemented since 2H20,ensuring stable and regulated development of the industry. Market Size Thepandemichas accelerated the development ofonline consumption habits, and livestreaminge-commerceemerged as a popularshopping method. As ofDecember 2021, China’slivestreaming e-commerceusers reached 464 million, an increase of 75% since the statistics was first released in March2020, accounting for 66.0%of all livestream viewers and44.9% ofInternet users, according to China Internet Network Information Centre (CNNIC). The huge user base have become the foundation for the development and monetization of livestreaminge-commerce. According to a report by KPMG andAliResearch, the overall market size of livestreaming e-commerce surpassed 1 trillion yuan in 2020 , a yoyincreaseof 142%. The penetration rateof livestreamingis only 8.6% at the time. It is estimated thatthe market size approached2 trillion yuan and the II.Livestreaming E-commerce Livestreaming E-commerce Ecosystem In addition to the three basic elements (merchants, hosts and platforms), other parties, such asMulti-Channel Networks (MCNs), have begun providing professionalservices for both livestreaming platforms and merchants. These all contribute to a fast-developing and vibrant business ecosystem. Downstream Thedownstream refers to usersof livestream platforms, or consumers. According to a survey conducted by China Consumers Association, consumers mainly watchlivestream to learn detailed information about a specific product or they are just attracted by promotional events by merchants. The main factors that attract consumers to make a purchase via livestream are value for money, product attractiveness and discounts. “Concerns about product quality"and “concerns about after-sales problems" are the two main reasons why consumers refrain from purchasing via livestream. Midstream The midstreamrefers tohosts and livestream platforms that provide merchants with traffic and promote products to consumers. Hostsinclude InternetKOLs/anchorsrepresented by Li Jiaqi (李佳琦)andViya (薇娅), celebrityhostssuch as Liu Tao (刘涛)and Wong Cho Lam(王祖蓝),executivehostssuch as DongMingzhu(董明珠)and Midstream (Cont’d) In terms of t