6 major misunderstandings about the live streaming sales trend

There is no doubt that live streaming sales is a hot topic, but it is now surrounded by various "misunderstandings".

History is always surprisingly similar. These unspoken secrets are the protective umbrella for entrepreneurs who entered the market early and developed quickly. When the industry was still hyping up this concept, they had already begun to reap the benefits quickly.

A few years ago, when you walked through every subway station, you could hear people talking about starting an Internet project; later, in every coffee shop, you could hear people talking about developing an app; and later, in every hotel lobby, someone could be heard whispering about issuing a coin.

When you walk in shopping malls now, you can vaguely hear young people talking about “bringing goods”.

Wu Shichun said that the era of live streaming on the Internet has arrived. Although these VCs who are used to creating concepts are sneered at by everyone, when Wei Ya, Li Jiaqi, Simba, Luo Yonghao, Liang Jianzhang and others appear in the live broadcast room at the same time, all businesses have to start rethinking their brand placement strategies. Will they still be foolishly investing in outdoor, subways, elevators, and film and television without thinking clearly?

The times are changing quietly. The number of people watching videos on the subway has exceeded those playing games and replying to WeChat messages. Pragmatic universities have begun to add anchor courses.

When the black swan of the new coronavirus suddenly struck, businessmen in first-tier cities who were living in a dream of decadence and rapid development also began to wake up. It is highly likely that we will enter the fourth consumption era of minimalism, rationality and low desire from the third consumption era of rampant materialism and piling up LV and Hermes.

The era when people are stupid, rich, vain, and deliberately buy things at expensive prices is over. In the past few years, the logic of limited special prices has been proven to be effective. Pinduoduo, Costoco, Wanlimu, and Li Jiaqi are making the middle class tear off their last disguise. Such cheap prices are really attractive!

However, those listed companies that were used to manufacturing for foreign brands lost their orders overnight. Their manufacturing capabilities and quality control were still there, but their brands were gone. Using the power of social media to create a cost-effective brand or white-label product seemed to be the only option.

When the four elements of video popularization, limited special offers, social media, and white-label transformation come together, live streaming e-commerce becomes a matter of the right time, the right place, and the right people.

To use a cliché commonly used by micro-businesses to motivate people: After you missed...,...,..., are you ready this time?

Live streaming sales may not make you rich, but it would be stupid to ignore it. Below we list a few pitfalls that were created with blood and tears by early entrepreneurs in this field.

Misconception 1: I need to have a lot of fans

Regarding live streaming sales, the most mainstream understanding is that you first have to be a big V, a kol, with a strong personality, rich content, and a large number of fans, before you can make money.

This is the logic of the fan economy, so if you ask a girl if she is willing to sell goods through live streaming, she will say: I don’t have any fans, who should I broadcast to? Who to sell to?

But this is also the biggest misunderstanding.

Over the past few months, some low-key entrepreneurs have been taking small steps and incubating new anchors in batches in the "sales promotion" track. Their main strategy is "amateur sales explosion": through the rational use of the "algorithm recommendation" rules of platforms such as Douyin and Kuaishou, a new anchor account with hundreds to thousands of fans can sell 5,000 to 20,000 on the first day of the broadcast, and can reach 150,000 to 300,000 in a month.

When these anchors started out, there were not many short videos on their homepages and they had very few fans.

The key to explosive sales lies in the algorithm. On platforms where algorithm recommendation has replaced social sharing to become the mainstream of "live broadcast distribution", the understanding of this point often leads to a huge contrast: on the other hand, we can also see big Vs with millions of fans, but because they don't understand this, there are less than a hundred people in the live broadcast room.

Fans do not determine the popularity of live broadcasts. The algorithm is the core, and the operational skills around the algorithm are the key.

It is an open secret that on a platform like Kuaishou, once upon a time, it was possible to quickly accumulate popularity by giving huge rewards to popular anchors and thus successfully "hanging on the list". Kuaishou's top anchor Simba has used this tactic before. It seems like a lot of money has been spent, but in fact, the cost of acquiring a single user is less than 1 yuan, but the average contribution of user consumption can be thousands.

This is the operation skill. The operation skill has been tried and tested in the early app promotion, from SEO to ASO, from brushing the rankings, increasing the volume, pre-installing on mobile phones to the points wall, and is now being used in the “cold start” of live streaming with goods.

Here’s how early adopters described these tactics:

As the core logic of distribution, the algorithm itself has no subjective likes and dislikes. The machine cannot judge the quality of the content. It can only make judgments based on data. So what you need to do is to win data that can bring more traffic recommendations.

When it comes to live streaming sales, the algorithm focuses most on whether it can maintain a high popularity in a short period of time: how many viewers there are, how long they stay, what the public screen interaction data is like, how many new followers there are, etc. If all these popularity indicators are met, it will be pushed to the next larger traffic pool. If the data still meets the standards, it will be pushed on to the next larger traffic pool.

Why are there so many audiences at the beginning? The algorithm may just randomly recommend it to some people. What if these people don’t like it? On a platform like Douyin, the simplest strategy is to use a small investment to purchase “Douyin”. This way, you can get a larger and more accurate recommendation range right from the start, which increases your operating space and probability of success.

How to keep the audience and maintain high interaction? Don’t think that you can rely on the host’s appearance and talent. What the live broadcast platform lacks the least is good-looking hosts. What is really important at this time is to quickly carry out some operational activities, such as random draws, deliberately delaying the listing and rush purchase time, and using some sales interactive scripts to guide interactive feedback on the one hand, and to firmly control the user’s attention on the other.

These are all delicate operations, all operations are for a good data performance, and all data are for greater recommendations.

From this perspective, if becoming a short video brand advertiser is more like the route of traditional self-media, then live streaming with goods is more like "operation competition" in app promotion and e-commerce promotion, which is a job for growth hackers.

Because of this, when entrepreneurs in the content field are still hesitating about how to position themselves, how to create a persona, and what content to produce, entrepreneurs who focus on operations have already arrived and have quietly started to receive a lot of orders.

You don’t need a lot of fans to get huge sales from live streaming. A simple analogy is this: in real life, when you see a sale at a large shopping mall, the host may be very charming and have a prominent image, but he or she does not have many fans. He or she just needs to sell the goods quickly.

Li Jiaqi and Viya didn’t start out by producing content in a high-profile manner and then slowly gain followers through the content. They just started selling right from the start.

Misconception 2: Wei Ya and Li Jiaqi cannot be copied, so there is no chance

The second most common misunderstanding is that live streaming sales has become a Matthew effect, and all the money has been made by top players like Li Jiaqi and Viya, so what chance do latecomers have?

For entrepreneurs, one of the biggest tragedies is that they read too many analysis reports from various investors. As a result, they do not have the background of investors "fooling" LPs into giving them money, but they often have the problem of investors' excessive analysis, which makes it too easy for them to see problems, hesitate to move forward, and dare not bite the bullet and get involved.

She is not destined to be a princess, but she has princess syndrome.

In fact, although Li Jiaqi, Wei Ya, Simba and Luo Yonghao have achieved astonishing sales, those unknown institutions and anchors are also making money, ranging from tens of thousands a month to hundreds of thousands or millions a month. It is obvious that live streaming e-commerce is far from reaching the point where "a great cause has been determined". The entire market is still growing, and the pie is getting bigger.

After all, we are just at the beginning of a new consumer era.

A simple question is, when Taobao already has Li Jiaqi and Viya, and Kuaishou already has Simba, who will be the top seller of goods on Douyin, a short video platform with 400 million daily active users?

As for Luo Yonghao, it is too early to draw this conclusion.

At the same time, we see that Xiaohongshu, Meitu, Bilibili, Sina and even Tantan have all rushed into live streaming e-commerce. When each platform enters the market, it will release a wave of dividends in order to cultivate the ecosystem. For future anchors, this is real money.

What's more, there are those who are waiting in the background and waiting for the right moment, perhaps trying to build the WeChat of China's YouTube (long and short videos, live broadcasts).

So it is ridiculous to complain that there is no way to recreate Li Jiaqi and Viya and that you will not be the second Li Jiaqi and Viya, and therefore stand still: because you don’t need to become Li Jiaqi and Viya at all. There are huge bonuses on the current live streaming platforms. A hard-working anchor who is good at using the operating rules has a high probability of making tens of thousands to hundreds of thousands of sales per month.

In other words, you don't need to sell 100 million in one show. You only need to earn tens of thousands or hundreds of thousands every month. In fact, you are already ahead of most people.

For merchants, there is no need to become a leading brand. They only need to cooperate with professional live broadcast organizations and replicate this model on a large scale, which can bring very considerable growth every year. Recently, several large clothing markets in Hangzhou have begun to enter the market in a big way according to this idea.

There were rumors some time ago that Zhao Yuanyuan from Taobao Live said that the opportunity for live streaming to sell goods would last at least 5 years. To put it simply, when people are tired of traditional advertising, no one goes to offline shopping malls due to the epidemic, and reading pictures and texts and then watching embedded ads is too inefficient, as long as revolutionary terminals such as VAR do not appear, video-based consumption behavior will be the mainstream.

It is too early to discuss the Matthew effect at the top at this time. With the release of more platforms and dividends, the trend of live streaming sales will definitely be more vertical and segmented, just like Li Jiaqi started with the lipstick that he is best at and gradually spread to all categories suitable for girls. In each vertical field, new stars who work hard and cultivate the market may emerge. They will first penetrate what they are best at, and whether they can expand to all categories depends on luck.

But even if there is no expansion, what does it matter? You can live a comfortable life by focusing on one field.

Myth 3: I’m beautiful or famous

So, do the already famous big Vs or internet celebrities who are already very successful in live show broadcasts have more advantages?

This is another illusion. In fact, the best-selling group so far is not this group of people, because they may need a personality and a sense of distance more, and therefore are restrained. For early institutions that incubate anchors, there is a consensus that one should not be superstitious about KOLs.

In fact, a sales person with sales experience would be a good choice, such as a saleswoman. Or, someone who is more camera-savvy and loves performing on air.

Not good looking? You obviously don’t understand how powerful the beauty filters of Tik Tok and Kuaishou are.

Is being good-looking an advantage? As I said, what is most abundant on all video platforms is beautiful women and handsome men.

According to the training experience of incubation institutions, a host can go from zero to proficient in a week at the fastest and a month at the slowest.

In this industry, the most important thing is not to be inferior or narcissistic. What is really needed is to respect the rules of the algorithm, follow the operational routines, and constantly try and iterate.

This is an era of long-termism. From shared bicycles to Luckin Coffee, if something becomes popular overnight, it will be a very ugly death. Solid progress, long-term persistence, building a strong base and fighting a tough battle are the gospel for every ordinary person.

From this point of view, there are two issues to be aware of:

1. Don’t start broadcasting easily. For platforms like Tik Tok, the official will direct extra traffic for the first three live broadcasts. It would be a pity to waste it. Please make adequate preparations before starting the broadcast.
2. If you have no experience in algorithm rules and operational skills, it is best to rely on a professional agency. Don't follow your feelings and don't be superstitious about your face, figure, and talent.

Misunderstanding 4: I need to have my own goods?

Someone else said, what if I don’t have my own brand? I can’t get the supply, let alone take over the entire supply chain.

It is normal to have this misunderstanding. In the early years, we listened to the chicken soup for the soul from internet celebrities and e-commerce companies, and people like Zhang Dayi all wanted to build their own brands. When talking about live streaming e-commerce today, everyone is saying that the personal charm of Li Jiaqi and Wei Ya is just the tip of the iceberg. The core is the team capabilities beneath the surface, the integration and control of the supply chain... Many people are frightened when they hear this.

In fact, this is still the business of the top anchors. For most mid-level and long-tail anchors, this matter has nothing to do with you at all. Don't be scared by them.

This is like the catering industry, where leading companies are involved in capital operations, franchising and mergers and acquisitions, which ordinary people simply cannot do, so does that mean ordinary people cannot make money by opening a restaurant?

These are two completely different things, don't think too much about it.

For general anchors, the easiest way is to go directly to the backend mall, look at the selected alliance, and choose what to sell. The most common choice is the Taobao route and hanging Taobao links.

In stock, shipping, free shipping? After sales? These are all things that the merchants have to do themselves, and the anchor only needs to settle the commission based on the effective transactions.

At present, the categories most suitable for live streaming sales are beauty products, clothing, food, daily necessities, etc., which are characterized by lipstick effect, low average order value, and high repurchase rate. The best target consumer group is indeed women.

As for whether it can expand to other categories, or even sell houses and cars, or direct the consumer group to young people of Generation Z and the elderly, to quote an old saying, it depends on your ability to strive and the course of history.

An anchor does not need to sell mainstream brands. In fact, except for top stars like Li Jiaqi and Viya, you have no room to bargain with big brands and strive for the lowest price in the market.

White-label brands are actually an opportunity for most people. Don’t wear tinted glasses and simply equate them with counterfeit, shoddy and crude products. In fact, in the wave of globalization over the past decade, Chinese manufacturing factories have been OEMs for most Western brands, and thus have strong quality control and extremely low costs. Why do some people claim to be manufacturing fanatics when talking about the rise of great powers, but become prejudiced against Chinese products when it comes to buying things?

Misunderstanding 5: Which platform to choose?

Kuaishou, Douyin, Bilibili or WeChat, which platform should you choose?

This is the most common question for newbies, and omni-platform marketing has long been a regular option. Take Papi Jiang as an example. She has 35 million fans on Douyin, 3.91 million fans on Kuaishou, 2.91 million fans on Xiaohongshu, 5.94 million fans on Bilibili, and 33.04 million fans on Weibo... Is it necessary for her to put all her eggs in one basket?

Of course, there must be a focus in specific operations, and we must also adapt to local conditions based on the characteristics of different platforms.

The characteristics of Kuaishou users are that they go to the lower-tier markets and value social relationships. You need to sell things that are popular among people outside the Fifth Ring Road and speak with emotion and trust.

The majority of Douyin users are urban residents, mainly women, with relatively strong spending power and great potential to be tapped. They have relatively high requirements for the level and quality of content, and the core of the gameplay is to use algorithm recommendations.

The majority of Bilibili users are young people. It has recently made great efforts to break out of its circle and has its own unique community atmosphere and discourse structure (梗 culture). The key words are shifting from the second dimension to "hardcore". It is much more difficult to increase fans here than on other platforms, but the authenticity and trust of fans are also higher. Xiaohongshu is a high-quality picture and text community that focuses on the upgrading of female consumption. The threshold for live streaming is relatively high, and only products from the Xiaohongshu Mall can be sold. Compared with other platforms, it is relatively closed.

WeChat is currently piloting the video account, and the traffic dividend has not yet been truly released. However, there is intelligence that WeChat’s level of attention this time exceeds that of its public accounts in the past, and it intends to build China’s YouTube.

The characteristic of WeChat video products is the distribution model: it is not pushed entirely to strangers at the beginning, but first to friends and second-degree connections (friends of friends). The infrastructure such as live streaming and selling goods has been built through mini-programs, and the traffic pool has been created through official accounts, groups, and private accounts.

As mentioned before, when each platform enters the market, it will release a wave of dividends in order to cultivate the ecosystem. For future anchors, this is real money. Currently, most platforms are just starting out and money is still on the way.

Misunderstanding 6: Companies need to cultivate their own internet celebrities?

If in the past every company had to have its own website, and later had its own Weibo and WeChat public accounts, then does every company now have to have its own anchor and video matrix?

The answer is yes. In fact, platforms like Douyin are vigorously supporting blue V accounts for enterprises, and the bonus period may be three months.

So the bosses said, I should quickly select a bunch of girls and train them to become internet celebrities.

There is something wrong with this idea. In fact, up to now, there are few successful cases of companies training their own anchors. There are too many cases where they select a few anchors to test the waters, but the results are not good for a few months and then they are abandoned soon.

On the contrary, in many companies, the bosses personally take charge (such as Liang Jianzhang of Ctrip), and the results are surprisingly good. This shows that in order to do live streaming sales well, there needs to be deep interest binding and connection, and the anchor needs to treat the company's affairs as his own affairs.

Just try it on a few people and it's obvious that the effect won't be good. The bosses complain that live streaming is unreliable, but in fact it is because they did not do it right from the beginning.

On the other hand, professional matters must be left to professionals . Most companies obviously do not have the ability and genes to operate live broadcasts, and they cannot even understand the data recommended by the algorithms. It is obviously meaningless to force it.

Therefore, finding professional anchors and agencies to operate on your behalf, or deep binding and strategic cooperation, is obviously the best choice.

However, the older generation of Chinese businessmen often have problems with their vision. On the one hand, they want to control everything in their own hands, and on the other hand, they always want to save money and get something for nothing. Cooperating with professional live broadcast organizations to share the pie is obviously not in line with their values.

In the past few years, they have taken on so much responsibility, including making their own websites, developing their own apps, operating their own Weibo accounts and public accounts, and even taking the pictures in the articles themselves with a SLR, and then lamenting that those were all scams and unreliable... Now the same idea is being copied to the video field, and the result is predictable.

This is not worth regretting. Business competition has always been a matter of survival of the fittest. In the future evolution of consumer and business society, conservative and stubborn people should be eliminated.

It is too late and too slow for companies to cultivate internet celebrities themselves, not to mention that people are the most unstable factor. If you really cultivate a super internet celebrity, what if he or she quits the job one day, or uses the traffic to control other people? Or maybe the host’s personality has a stain (like some of the recent popular young stars), and the audience has turned from fans to haters, and from loving the host to hating the host?

As I said, this is an era of division of labor and integration, and professional matters should be left to professionals.

When the epidemic hit, every boss was at the crossroads of life and death. If they didn’t change, they would die. If they changed but it was “unprofessional” and ineffective, they would also be in trouble.

Whether you are a live streamer who aspires to sell goods through live streaming, or a boss who is planning to test the waters, please pay attention to the last warning at the end of the article: this is not a motivational article to tell you that there are great opportunities here and you should hurry up. There have been too many such articles in the past few years. This article is to tell you that although this field is attractive and is a general trend, there are still enough pitfalls and you have to try to become professional.

Those who advocate selling goods through live streaming may be wrong, or they know it is wrong but just hide it from you.

Author: Zhang Jun

Source: A Debate (ID: bianlunlove)

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