In past years, particularly before the pandemic, online shopping may not have been a familiar or comfortable option for consumers. However, today it has become a preferred method of shopping due to its practicality and reliability.
The pandemic gave rise to social distancing, which forced the business world to rethink consumers' shopping experiences and behaviour. As online shopping emerged as a hero, this challenge propelled the growth of ecommerce startups to the next level. Today, familiar brands like Tokopedia, Gojek, Shoppe and Lazada have become the go-to destinations for every need, driven by pure convenience as products are delivered right to the front door with just one simple click.
The availability of ecommerce, especially on mobile phones, has transformed shopping into a 24/7 activity, as consumers are no longer limited to specific hours of the day to make purchases. This behaviour change was reflected in a study conducted by McKinsey in the third quarter of 2020, which revealed a 165% increase in online shopping by consumers.
While convenience, access, and practicality may be the primary drivers behind the rise of online shopping, it lacks the personal touch and shopping experience that brick-and-mortar stores continue to offer.
Looking specifically at Indonesia, a country that strongly emphasises collective experiences and social interactions, these aspects extend to the shopping experience. For Indonesians, shopping is not merely a transactional experience between the seller and the consumer.
Still, an essential part of the day where people exchange knowledge, share stories and build strong personal connections on trust. In traditional shops, this fun yet crucial part of the shopping experience would also include negotiating a price that is fair and profitable for both parties and able to build a long-term relationship that could positively affect the business's success by generating consumer loyalty.
While it is true that consumers and sellers can communicate online through comments or personal messages, the interpersonal engagement and emotional gratification present in physical stores is often missing from the online shopping experience. This gap is further widened as more brands adopt AI or automatic computerised answering machines to interact with customers.
As a result, online shopping experiences have had to evolve to compete and succeed. One solution that has emerged is the great success of online live shopping. Through live video streaming, customers can interact with sellers in real time, ask questions, and receive immediate responses. This helps to bridge the gap between physical and online shopping experiences by creating a more intimate and engaging environment. As a result, online live shopping has become an increasingly popular way for brands to connect with customers in Indonesia and differentiate themselves from competitors.
Live shopping: The new way of shopping
Live shopping has quickly become a popular way to shop, offering a unique combination of both offline and online experiences. Some key reasons for its success include:
1. Personalised recommendations: During live shopping sessions, consumers can engage directly with the seller, ask questions, and receive personalised recommendations. This allows consumers to get the seller's perspective and better understand the product's usage and benefits. It's like having a personal shopping assistant in the comfort of your home.
2. Inter-personal engagement: Live shopping sessions are often accessed by thousands of consumers simultaneously, which means the seller must have a thorough knowledge of the product and the charisma and energy to engage the audience throughout the session. This is similar to shopping at famous shopping centres like ITC Mangga Dua, where sellers try to engage and offer products to passing customers. Through live shopping, consumers can have a similar interactive and engaging experience from home. The sellers or presenters talk non-stop in a chatty, sometimes aggressive manner to capture the attention of browsing consumers and keep them engaged.
3. Provides a product experience: Online live shopping allows consumers to try on products virtually, which helps them make informed purchase decisions. They can see the actual condition of the product and even ask the seller to try it on to see how it fits. This is especially important for wearable products with various customisation options for shape and colour. Unlike a website with only high-quality modelled pictures, online live shopping offers a more reliable and interactive way to experience the product. Consumers can also ask questions directly in the comment section, and the seller can respond promptly, providing a seamless and personalised shopping experience.
4. Offers an opportunity for special deals: While the traditional bargaining culture may not be directly applicable in online live shopping, the concept of special deals in flash sales has occurred. Flash sales are constantly changing price deals that are curated by the seller for each session, with unique time slots or limited stock for each deal. This motivates consumers to make quicker purchase decisions and attend multiple sessions to find the best deals, generating loyalty among viewers. In addition, such exclusive and customised deals add excitement and value to the online shopping experience, replicating the sense of discovery consumers often feel in the physical stores.
Online live shopping is immensely successful for businesses, especially small or local ones operating online. According to research conducted by Jakpat, approximately 83% of Indonesians have watched online live shopping before. Furthermore, brands that stream online live shopping experience conversion ratios of up to 30%, three times higher than the conversion ratio of regular ecommers platforms.
This metamorphosis of online shopping is a prime example of the future of living, a hybrid of online and offline socialisation.
For the small local business, it is a midway point that helps them adapt to modern online marketing while retaining the importance of interpersonal interaction. Likewise, it allows consumers to move forward into the future without sacrificing the value of interpersonal communication.
To the business world, it brings the banter, bargaining and general camaraderie of traditional local markets into a whole new dimension.
Ecommerce vs social media live shopping
Live shopping is available on social media and ecommerce, with the two most popular platforms being TikTok and Shopee. While both live shopping platforms are popular in Indonesia, the way these platforms interact and engage with consumers is very different.
TikTok Live shopping engagement strategy
Indonesia is the second biggest user of TikTok in the world (based on DataIndonesia.id in January 2023). Scrolling the platform has become intuitive for many Indonesians, with many hours spent on it daily.
Hence, when the live shopping feature was introduced to the application, it easily slipped into the existing audio-visual communication medium and scrolling behaviour. As a result, the inclusion, engagement and user experience was seamless.
As exposure to live shopping is part of the more extensive Tik Tok experience, purchase and consumption, tend to be spontaneous and impulsive as consumers' accidentally' land on the brand page or content. The persuasion to buy is driven by content attraction and intense content interaction between buyer and seller.
Shopee live shopping engagement strategy
The live shopping experience on Shopee is very different. Not only is the brand content different, but consumers need to come to this platform to purchase consciously – thus, the shopping is planned and intentional.
Due to this, brands tend to have more product focus conversations with consumers, leading to better brand exposure. In addition, as the focus is entirely on the shopping experience, the platform can also create exciting programs to promote businesses. For example, Shopee created UMKM Campus and Export Program last year.
While both platforms offer a live shopping experience, there is a massive difference in how brands engage and interact with consumers. Social media live shopping content needs to be exciting and instantly engaging. Results in impulse purchases and ecommerce live shopping experiences must deliver a more deliberate and product-focused conversation. This gives the brands many options to decide which live shopping platform would fit their strategy best.
Natasia Wangsaputra is an associate at Quantum