Key points to remember:

  • Digital investments, human resource limitations and image control are obstacles to growth in the age of direct commerce in China.

  • A tendency to underestimate the production value of digital media and rely on content outsourcing are common issues that prevent luxury brands from streaming well live.

  • To connect with consumers via live streaming while maintaining the right look and feel, brands need to treat it as proper production and build their capacity internally.

A year of COVID-fueled digital lockdowns, which led to the use of live commerce to connect with Chinese consumers, has turned live broadcasting from a ‘yes or no’ dilemma to a ‘how-to’ question »For luxury brands. According to Coresight Research, Chinese consumers are expected to spend $ 300 billion on products featured in live stream videos this year. For brands, it has never been clearer that live streaming is an essential part of doing business in one of the world’s most digitally advanced markets.

The past year marked the arrival of the Chinese live streaming trend for many because “if not now, when?” Louis Vuitton held its very first live streaming session on Little Red Book, a popular Chinese social lifestyle platform. Net-a-Porter has sold luxury bags by partnering with A List influencer M. Bags on Alibaba’s Taobao Live platform and live streaming exclusive Watches & Wonders Geneva watches, the largest luxury watch show. Kering-owned brand Bottega Veneta took it a step further by collaborating with super-host Austin Li on a sales-focused livestream that sold a record-breaking 230 mini bags ($ 1,910 each) in 10 seconds.

The astronomical sales figures of China’s live-streaming economy could easily make brands see digital media as the magic bullet. But despite the headlines, rapid sales, and brands like Bottega Veneta making bold decisions in this space, the story of luxury with live streaming is still in its infancy. And just integrating live broadcasts into a brand’s digital marketing strategy doesn’t guarantee success.

To turn this industry buzzword into a sustainable practice, brands need to be aware of the current limitations of live streaming before they jump into the trend.

First, being ill-prepared and failing to meet the high expectations of the Chinese public in luxury livestreams could backfire on a brand’s reputation. Based on early industry experiences, lack of live stream preparation appears to be a common Western luxury issue.

Louis Vuitton’s Little Red Book livestream debut drew a lot of ‘cheap’ comments because its background and production style was no different from other Taobao venues selling fast fashion to strong. discounts. In January of this year, Dior’s live chat after his Couture Spring 2021 show improved the quality of the background, but audiences lamented the conference’s “boring” conversations, suggesting that brands are still a long way off. to understand the necessary nuances of this digital medium.

Outside of China, brands tend to oversimplify live streaming as a sales-only medium and underestimate its production value. The association of live streaming with mass market categories has also prevented image-obsessed luxury brands from seeing it as a brand vehicle in its own right.

In the West, live social media sales are widely regarded as a one-of-a-kind shopping experience, not a famous lifestyle. Yet in China, especially with millennials and millennials, consumers are used to seeing professional, well-executed, well-paced live broadcasts as part of their daily content routine.

Nicola Antonelli, CMO of luxury retailer Luisa Via Roma (below “LVR”), said the industry often oversimplifies live streaming as a technological challenge while ignoring its overall operational complexities. He said Daily jing that “it’s not just a question of technology, but a question of mixing things together. I would say it’s like a TV series or a show. To produce it, you need to take care of every detail: the people, the lights, the makeup, the settings, the price and many other things. It is mandatory to have a structured project. “

Xiao Xue, former editor-in-chief of Elle China and one of the country’s most powerful fashion voices, said she was overwhelmed by the amount of prep work before she appeared on a live show of 15 minutes organized by Ferragamo. Co-hosted by livestream superstar Austin Li, the show focused on the history of the Maison’s brand and the history of its iconic museum bags.

A live Ferragamo show featuring Xiao Xue, the former editor of Elle China, as well as super host Austin Li. Photo: Weibo

“Despite over two decades of working in fashion media, I found myself unprepared and completely new to the challenge of live streaming,” Xiao Xue said in his WeChat newsletter. Before the show, she watched Austin Li’s livestream every night for two weeks to familiarize herself with the rhythm of the language, and she edited the scripts over five times with the brand’s team. Still, the show did not disappoint. In 15 minutes, the show hit seven million views at its peak and sold 200 museum bags worth $ 2,640 each.

Then, the lack of a live broadcast culture inside luxury houses is another obstacle for brands using the medium. Zoe Zhang, co-founder of New York-based direct commerce consultancy ANDLUXE, said a big challenge luxury brands face is their reliance on outsourcing when operating in this fluid digital space. . “Brands should really develop their own live streaming capabilities, which means building an internal live streaming team, collecting live streaming best practices and focusing on an engaging content creation program,” Zhao said. .

Most brand players now rely on outside marketing agencies to work with influencers and super hosts, and this distance from end consumers often leads to brand disconnection. “Owning the livestream in-house would allow brands to build a direct relationship with customers, ensure stories are told the right way, and reduce reliance on influencers,” Zhao suggested.

For increasingly digital Chinese consumers, there is no doubt that a live streaming formula works. But to do it right, brands need to make inroads in their people, logistics and market environment to ensure traffic, service and quality of conversion. The real progress comes when brands stop portraying live broadcasts as a purely technological issue and start seeing it as an integral part of today’s hyper-connected world.

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