Jidi Guo
Dec 8, 2016

Digital Ferraris are the currency of China’s booming live streaming economy

Flamingo Shanghai's Jidi Guo provides a rundown of the user-driven content market and brand opportunities.

Jidi Guo
Jidi Guo

Audiences for live-streaming apps have grown rapidly in China, presenting a huge opportunity for content creators and brands prepared to partner with them. There are major differences in the way live streaming works in China as opposed to the West, ranging from the type of content that can be shared to the way streamers make money.

What is mobile live streaming like in China?

Where live-streaming is not really a new practice—we have grown accustomed to streaming of sports matches, large events and cam girls over the past decade—mobile live-streaming apps in China have slightly different qualities. The platforms are mobile-native (also accessible through web interface), are populated by user-generated video content and feature live broadcasts, allowing everyone to interact with each other in real-time for all to see.

While YouTube has provided an international platform for user-generated video content for over a decade, China’s online video platforms were more popular for TV shows and movies produced by professionals. It wasn’t until the rise of mobile live streaming that the possibility of broadcasting their everyday lives reached mainstream Chinese netizens.

And the difference between international counterparts such as Twitter’s Periscope, or the hyped and failed Meerkat? A lot of people are actually watching.

How big is it?

Live streaming really began to gain traction in China in 2013 when it migrated from desktop to a mobile-native interface where you could find beautiful girls performing on the Room 6 (六房间) app and geeks playing the latest online role-playing titles for gaming fans on platforms at Douyu (斗鱼). Fast forward to late 2016 and the Chinese mobile live streaming market has exploded to over 200 apps and 200 million users. Compared to the user base from international platforms such as Twitch’s 45 million users and Periscope’s 10 million users, mobile live-streaming in China is really big.

Who are the major players?

The monetary value of this mobile trend is reflected in the strong interest Chinese tech companies have invested in this space. The most popular platforms are all affiliated with local tech giants: Inke received investment from Duomi MusicHua Jiao was bought by 360.comYi Zhibo was acquired by Sina; and Meipai is owned by Meitu Xiuxiu’s beauty camera app.

With the overwhelming choice of platforms, there is fierce competition for viewers. The two main strategies are: signing key opinion leaders who already have a strong online following; and developing new talent, helping to promote them and develop their content. Watching long live streams can be boring, and it’s quality content that brings viewers back for more.

Who are the stars?

Among the most popular live streams, unsurprisingly, are beautiful girls giving make-up tutorials, showing off their dancing, playing instruments or doing not much at all. One of the first applications for live streaming, like other online technologies, was pornography—cam girls. In an attempt to keep things from getting too salacious, the government banned women from eating bananas on camera. Gaming also remains a strong subject of interest, from watching players’ progress to commentary on e-sports. But what live streaming has really popularised are mundane videos of broadcasters eating, walking the streets, or on the job. The live chat feed opens up interaction between broadcaster and viewers, and among viewers. The broadcaster can address audience questions and requests, and sometimes even bring audience members into the video stream.

This article is part of the Cultural Radar series

Popular broadcasters are making a career out of live streaming and many are managed by talent agencies. Viewers can purchase credits to exchange for gifts. These gifts are animated stickers holding real value anywhere from 1 to 1,000 RMB each. Fans show off by sending Ferrari and yacht stickers directly into the stream to capture the attention of broadcasters in return for a shout out or performance. On the receiving end, broadcasters can convert these gifts into real cash, making as much as 300,000 RMB per day. For each transaction, the platform takes a small cut, enough to support an increasingly lucrative industry.

For example, mobile-first app Periscope allows viewers to send hearts for appreciation, and tips can be transferred through third-party payment apps. On YouNow, with 5 million users, broadcasters can earn up to US$15,000 per month from digital tips, but first you have to become a YouNow Partner by broadcasting at least twice a week, have an average of 500 viewers and follow a set of rules.

Where do brands fit in?

Brands are excitedly watching the space mature, pondering how to add mobile live streaming to their marketing toolkits. Recent efforts include live-broadcasting star-studded events and giving netizens a backstage peek at photo shoots. Taobao held a live stream event called “517” (phonetically similar to 我要吃, I want to eat) to promote its food delivery service, and Durex caused a stir with a campaign live streaming 100 people getting ready to have sex, teasingly cutting off the stream after three hours of anticipation.

But the real future might not be in the hard labour of building and maintaining a branded live-streaming account, but rather strategically building relationships with content creators and finding creative ways to keep them watching.

Jidi Guo is research executive at Flamingo Shanghai

Campaign China

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