How big will livestreaming ecommerce get in Southeast Asia?

This durian season, Lawrence Lim, who runs traditional confectionery store Gin Thye, is turning to ecommerce platforms Lazada and Shopee to livestream his shop’s products. That’s on top of the livestreams it conducts regularly on Facebook via partnerships with third-party seller pages like KakilangSG that have their own following.

In a recent one-hour livestream on Shopee that drew close to 900 viewers, a host unboxed Gin Thye products, showcased their packaging, shared her “honest” reviews, and answered queries in real time. “It is really silky and smooth… If you’re a durian lover like me, you’d definitely not want to miss this!” she exclaims, while eating a durian mousse.

In China, livestreaming ecommerce was a US$61.2 billion industry in 2019, a figure that’s expected to double this year. Three main players dominate the Chinese market: Alibaba’s Taobao Live, which was launched in 2016, as well as short-video apps Douyin and Kuaishou.

Covid-19 has accelerated the pickup of the ecommerce format in Southeast Asia, which is home to over 650 million people. While Lazada introduced its LazLive feature as early as in 2018, Covid-19 has given the trend a further boost, as pandemic-induced lockdowns across the region in the past few months forced many to explore other ways of discovering new products.

Lazada said it welcomed over 27 million active live audiences in April, adding that it has over 65 million annual active consumers.

US tech giant Facebook is the latest to want in on Southeast Asia’s thriving ecommerce scene. The launch of its free-to-use selling tool Facebook Shops in May and a recent investment in Gojek are strong indicators of its ecommerce ambitions in the region.

How big is the opportunity?

While the scale of livestreaming in Southeast Asia has yet to match China’s, the region has great potential, says Xiaofeng Wang, a senior analyst at market research firm Forrester.

The growth trajectory of livestreaming in China could shed light on how fast and how far the phenomenon can take off in Southeast Asia.

In its Singles’ Day shopping festival last November, Taobao Live recorded a gross merchandise volume (GMV) worth nearly 20 billion yuan (US$2.8 billion), which accounted for over 7.5% of the group’s total sales in the one-day event.

Between April 2018 to March 2019, Taobao generated more than 100 billion yuan (US$15.1 billion) in GMV through Taobao Live. Ecommerce sales from livestreaming grew at a pace of 150% year-on-year between 2017 to 2019, according to Taobao.

However, it appears that livestreaming makes up only a small percentage of ecommerce sales even though Taobao Live is also available to Tmall merchants.

It’s likely that livestreaming will feature as part of a broader suite of services including games, social networking, and in-app chats, which collectively work to increase user engagement and time spent on the platforms. At the same time, traditional ecommerce is expected to continue its dominance.

Accelerated by the pandemic

Facebook’s foray

The merchant equation

Building a foundation