Live streaming can sell products, so why do brands still need to spend money on advertising?

Some time ago, the news that Li Jiaqi and Li Ziqi's annual revenues in 2019 reached 200 million yuan and 160 million yuan respectively, was widely circulated on the Internet. Although Li Ziqi later personally denied the statement of "annual income of 168 million", this also indirectly reflects that the commercial value and ability to sell goods of Internet celebrities such as Li Jiaqi and Li Ziqi are attracting public attention and recognition.

Take Li Jiaqi for example. On Double 11 in 2019 alone, his sales exceeded 1 billion. During this year's Spring Festival, more and more brands flocked to Li Jiaqi's live broadcast room, hoping to use Li Jiaqi's witty remarks to boost their brand's Spring Festival sales.

But have you noticed an interesting phenomenon? Although live streaming can bring goods to brands on a large scale, the brands’ Spring Festival marketing has not stopped or slowed down, and they are still sparing no effort to allocate budgets for advertising.

Even though live streaming can help brands sell products, why do brands still need to advertise? Let’s talk about it today.

01. Livestreamers’ promotion vs. brand advertising: a common theme

Can anchor sales replace brand advertising? This question is not nonsensical. Because in essence, the two can be said to be of the same origin.

What is advertising? In short, spread the word. The earliest commercial advertising was aimed at promoting products or providing services. It disseminated product or service information to consumers, changed people's attitudes toward the products, and induced them to buy.

The rise of anchors selling goods is due to the development of live streaming platforms. When a live broadcast can attract a large number of viewers, it becomes an excellent platform for information dissemination. Some businesses began to consciously implant their products into the live broadcasts of internet celebrities, which in turn gave rise to professional anchors who specialized in selling goods during live broadcasts. Anchors such as Li Jiaqi and Wei Ya emerged.

Many people compare online live streaming sales to early TV shopping. There are also people shouting in front of the screen, introducing the product's features and favorable prices verbally to attract consumers to place orders.

Moreover, online live streaming eliminates the step of ordering by phone and can directly provide a purchase link, making the transaction process more convenient, thereby greatly increasing the order rate. Its ability to bring goods is far greater than any other form of advertising for the brand.

Therefore, brands of all sizes have begun to enter the live broadcast room, and with the host's passionate and expressive promotion, they have leveraged the purchasing power of consumers.

For brands, online live streaming sells products quickly and at low cost, making it an excellent channel to increase sales. So, can brands stop advertising?

02. Brand advertising is not just for selling products

Although like online live streaming, the ultimate goal of brand advertising is to sell products, advertising has broader value significance for a brand beyond selling products, which cannot be achieved through live streaming alone.

1. Gather target consumer groups to achieve more precise marketing

We all know that the launch of an advertisement often requires in-depth market research in the early stages. Through SWOT analysis, etc., the advertising objectives, market positioning, and target groups of the product are determined to help the brand to market more effectively.

Especially for brand advertising targeting specific cities or specific groups of people, it is necessary to analyze specific issues specifically and determine specific strategies such as creative form and advertising media based on the cultural features of the city, the consumption habits of the people, etc.

For example, the popularity of Jiang Xiaobai is inseparable from the cultural label created for the brand through the urban characteristics of Chongqing. Chongqing dialect, Chongqing cuisine, Chongqing tourist attractions, etc. have all allowed Jiang Xiaobai to quickly open up the young market with the "personality" of "mountain city literary youth."

Elevator advertisements, which become more popular the more they are criticized, are actually a media placement strategy of advertisers, targeting urban office workers. The brand expands its popularity among the target market through a brainwashing cycle.

Obviously, this promotion strategy that is tailored to local conditions cannot be achieved by just a few minutes of word-of-mouth promotion by a host.

2. Achieve more diversified interactions with consumers

What is the format of live broadcast? The anchor on the screen and the fans outside the screen, online and offline, interact in ways such as sending gifts, posting barrages, displaying and trying out products. It seems to be a real-time face-to-face communication, but in essence it is still a relationship between performers and viewers, no different from an advertisement.

Recognizing this reality, we will find that besides live streaming, brands have more diversified forms of information communication. For example, opening theme stores and pop-up stores to provide consumers with a more immersive consumption experience; injecting younger and more trendy genes into the brand through cross-border marketing and national trend marketing; and placing large outdoor advertising billboards to create a more impactful visual experience.

For consumers with ever-increasing demands, only freshness, excitement and constant innovation can keep them paying attention to and liking the brand. However, it is obviously not enough to maintain consumer loyalty solely through live streaming sales.

3. Advertising is a process of brand building

Of course, if we look at it purely from the perspective of cost and benefit, the cost of a brand advertisement with voice and sales will be much higher than the share given to the anchor during an online live broadcast, while the sales volume may not even be as much as that of a live broadcast.

But what we need to know is that a successful brand cannot be separated from long-term and continuous advertising. The process of advertising is actually a process of brand building.

For example, Snickers has always adhered to one advertising creativity and created the familiar sand sculpture style of "Hungry people, come and have a Snickers" and the slogan "Sweep away hunger and be yourself".

From Yao Ming and Wang Junkai to Lin Daiyu and Jiang Mengjie, Xu Xian and Ye Tong, Hua Fei and Jiang Xin, Su Daqiang and Ni Dahong... Snickers' advertisements, while changing and remaining constant, gradually conveyed the brand's "relieve hunger" consumption proposition and youthful brand concept to consumers.

To a certain extent, when the brand is successfully built and has a stable consumer market, the cost of advertising investment can be relatively reduced. For example, internationally renowned brands such as Coca-Cola, McDonald's, and KFC focus more on new product categories in their marketing without having to invest too much advertising budget to increase their popularity.

In other words, for those brands that have not yet established a clear recognition, they need to deepen consumers' memory through advertising, continuously extend the brand's life cycle, and consolidate market competitiveness, which are things that online live streaming cannot achieve.

03. Under the halo of Internet celebrities, brands lose their C position in live broadcasts

If you ask a consumer why she would place an order in Li Jiaqi's live broadcast room, she might tell you the following answer:

1. Li Jiaqi sells authentic products with guaranteed quality;
2. Li Jiaqi can get the lowest price of the brand, which is affordable;
3. Li Jiaqi’s live broadcast is magical, I am his fan.

With the trend of e-commerce live streaming, e-commerce anchors such as Li Jiaqi and Wei Ya have a large number of loyal fans. It can be said that the number of online viewers of live broadcasts is the core indicator of the commercial value of internet celebrity anchors. For anchors, the brand needs to give way to fans. Therefore, Li Jiaqi dares to complain about brands during live broadcasts, but he always responds to fans' requests.

At the same time, the personal brand value of the anchors is also being widely explored. For example, the movies "The Beneficiary" and "The Whistleblower" have sold tickets on live streaming platforms. When Hu Ge was a guest in Li Jiaqi's live streaming room, 255,000 tickets for the movie "The Gathering at Southern Station" were sold out in an instant.

During the broadcast of the TV series "Joy of Life" and "The Ming Dynasty", the relevant creators also promoted the dramas in Li Jiaqi's live broadcast room, which sparked huge discussion on the Internet.

Under the host's star halo, the brand seems to be overshadowed. Users watch live broadcasts and consumers buy goods based on the host's appeal, the entertaining content of the live broadcast, the discounts on prices... not because they truly recognize the product, but because they love the brand.

In other words, a live broadcast consolidates the host's fan base rather than cultivating user loyalty to the brand. If a brand does not participate in live streaming on a certain day, or the discount is not that great, consumers will inevitably turn to buying other products.

04. The uncertainty of live streaming increases the brand’s own risks

Li Jiaqi's promotion of non-stick pans during a live broadcast went wrong, causing netizens to question the quality of the brand's non-stick pans; Li Xiang's live broadcast of selling goods was watched by 1.62 million people, but in the end only 77 cans of milk powder were sold, and the sales volume of mink coats was 0...

Since the success of a live broadcast mainly depends on the performance of the anchor, the damage to the brand image caused by a failed live broadcast by the anchor is immeasurable.

But live streaming lacks controllability, and the probability of failure is even greater. In addition, stricter policy controls on the live streaming industry will also limit the performance of anchors.

Therefore, if a brand abandons advertising and only relies on anchors to sell products, it will only increase the risks of brand development.

In addition, online live streaming sales are only possible with the orderly development of multiple industries such as live streaming, e-commerce, and logistics. If any one of these links is missing, it will be difficult to proceed in an orderly manner.

For example, the recent novel coronavirus pneumonia epidemic has had a huge impact on e-commerce live streaming. Imagine if a brand never advertises and only relies on e-commerce live streaming to sell products, then the emergence of this epidemic will be a fatal blow to the brand.

It can be seen from this that although e-commerce live streaming can bring benefits to brands, advertising is still an indispensable promotion method. Using diversified channels to reach consumers can reduce the risk of brand development and improve the brand's ability to cope with various crises.

Final Thoughts

Of course, in the context of e-commerce anchors selling goods, live streaming is a channel that brands cannot ignore. Its advantages such as low marketing costs, high user penetration, and effective marketing effects are all unachievable by other promotion methods.

However, it should be clear that e-commerce live streaming is the icing on the cake for brand development, but it is not everything.

The development of a brand requires a more strategic, forward-looking and coordinated marketing plan, constantly adapting to environmental changes, and using diversified and innovative advertising ideas and marketing strategies to meet the consumption needs of different age groups and user circles. In addition to selling products, the brand should truly be deeply rooted in the hearts of the people and win the love and trust of consumers.

Author: PR World 007

Source: Public Relations Network 007 (PRCN007)