After setting up her lights, cameras, and microphones, Lynna Machida sat in front of a shelf of wigs and makeup in a professional studio in Los Angeles. A message pinged into her feed: “Could you try the number seven?” and she took the corresponding wig—manufactured by her Chinese client—down and pulled it over her long, thick hair.
Machida is an aspiring actor, but gigs dried up during the pandemic. Then, in mid-2022, she was approached by Dance Art, a multi-channel network (MCN) that hires influencers to sell products on platforms over TikTok and Amazon. Since then, she’s sold everything from cosmetics to charging cables. On Amazon Prime Day in July, she took part in an eight-hour marathon session, selling electrical appliances.
Success at livestreaming is all about creating a relationship with the audience, Machida says. Her interactions with her viewers have to be spontaneous and feel genuine. “Because they see me taking my moment, put on the wig, and then I have to adjust it, they think it’s real,” she says.
American social media is full of people selling things—TikTok influencers hawking their own branded products and Instagrammers pushing their followers to sponsored links. But true livestream ecommerce of the kind pioneered by Chinese retail giants—which is not unlike old-school television sales, where a host hawks products live over the internet, sweetening the deal with discounts and promotions—has never quite reached critical mass in the US. Now, lured by the vast scale of the business in China, companies including Amazon, YouTube, Shopify, and TikTok have invested heavily in live selling. But they’re struggling for traction. Facebook and Instagram have already bowed out. And experts from China say that the American market may just not be ready for livestream ecommerce.
“I haven’t seen one success case,” says Marina Jiang, an expert in cross-border ecommerce and founder of The Unoeuf Creative Consulting, a social marketing agency. “If there is one proof of concept in the United States, I would be willing to try it myself.”
Livestreaming—without the selling—has been huge in China for a decade. By June 2016, 325 million people—46 percent of all internet users in China—were regularly watching livestreams, according to the China Internet Network Information Center, a government agency. That year, companies began to integrate sales channels into their livestream offerings, and vice versa, led by fashion retailer Mogujie and Taobao, the country’s biggest e-tailer, which launched their services in March and April 2016, respectively.
Some early streamers were able to make a fortune. Huang Wei—known online as Viya—started streaming on Taobao in May 2016. She and her husband had started an online clothing store on Tmall (formerly known as Taobao Mall) in 2012 but struggled to turn a profit. Just 200 people watched her first livestreaming sales session. However, within four months of selling on her stream, she had made more than 100 million yuan ($14.4 million) in sales.
The industry’s real star emerged towards the end of 2016. Austin Li—China’s “Lipstick King”—won a nationwide online sales competition, launching his career at Taobao. A former salesperson for L’Oreal, he quickly built a following selling lipstick, sometimes trying on more than a hundred different shades in a single session. In a 2018 stunt, he competed with then-Alibaba CEO Jack Ma, winning by selling 15,000 lipsticks in five minutes.
The pandemic sent the livestream sales industry into overdrive. The Chinese government’s strict “zero Covid” policies hit the brick-and-mortar retail industry hard. Stuck at home, sales assistants and business owners started to sell online, joined by celebrities, athletes, even government officials. Asset management company CINDA Securities estimates that the livestreaming market was worth 2.84 trillion yuan ($42.3 billion) by the end of 2022.
Livestreaming wasn’t just something that ecommerce companies did—social media companies saw it as a way to monetize their platforms. Among them was Douyin, the Chinese version of TikTok, which began cooperating with Taobao in March 2018 to test a shopping cart function for celebrity accounts with more than 1 million followers. By December, the function was rolled out to all authenticated accounts with more than 8,000 followers.
After TikTok took off in Western countries, the company tried to export the livestreaming sales model too. The company launched TikTok Shop in the UK in August 2021, allowing merchants, brands, and creators to display and sell products directly on TikTok.
Jiang was among the first batch of influencers invited by TikTok to test out the TikTok Shop function. She was able to find multiple brands that were interested in the UK market. She invited her friends to be influencers while she handled the administrative part. They livestreamed nonstop for a month, broadcasting around three hours per day.
The results weren’t encouraging. One of the products she was selling was sportswear, on behalf of a Chinese brand that wanted to target young women aged from 20 to 30, “but a lot of the audience our session attracted were 50- to 60-year-old men, wanting to see influencers trying tight sportswear,” she says. “I don’t think they have figured out the algorithm to bring the right demographic to your streaming.”
TikTok didn’t respond to a request for comment.
In July 2022, the Financial Times reported that TikTok had abandoned its plans to expand TikTok Shop to Europe and the US. Four months later, however, the company began to test its shopping function in the US, offering brands a built-in payment system that means customers can buy products without leaving the platform. In July 2022, YouTube announced it would expand its live shopping partnership with the ecommerce platform Shopify.
“For years, everyone has watched the China live-selling business absolutely explode,” Michelle Goad, operating partner of investment firm TCG says. “I believe the platforms felt the feature had been de-risked enough through watching some of these startups consistently grow to finally put their hats in the ring.”
Meta also experimented with live shopping on Facebook and Instagram, but it has since quietly shelved livestream ecommerce functions on both services.
Amazon launched its Amazon Live platform in 2019. In 2021 and 2022, the company ran livestreaming events for its Prime Day sales events, featuring cameos from celebrities, including comedian Kevin Hart and Australian model Miranda Kerr. The company says it’s happy with the platform’s growth.
“I believe video shopping is the future of retail. It’s still early for us, but we’re inspired by the excitement we’ve seen from creators, brands, and customers,” Wayne Purboo, vice president of Amazon Shoppable Videos, said in an emailed statement. Purboo said that streams on Prime Day in 2022 clocked more than 100 million views, with the top stream peaking at 57,000 concurrent viewers.
However, this is still a fraction of the viewership that China’s leading streamers regularly attract, and outside of Prime Day, it is hard to find Amazon livestreams with consistently large audiences. Many of the brands on the platform are Chinese, which use Chinese influencers for their sales.
Chinese experts say the reason for the slow takeoff of livestream ecommerce in the US is that there are significant differences in consumer behavior between the American and Chinese markets. In China, livestream ecommerce is as much an entertainment product as a retail one, with viewers tuning in for hours at a time to interact with hosts as well as to get access to discounts and deals.
“American consumers shop online to save time. If they want to shop around, they would go to department stores,” says Souffle Li, who recruits livestreamers for the industry. “They value their time differently than Chinese consumers, so they wouldn’t watch hours of livestreaming to purchase discounted products.”
Amazon’s own statistics show that 28 percent of purchases on the company’s platform are completed in three minutes or less, and half of all purchases are finished in less than 15 minutes. The company has focused on offering further time savings, from shorter shipping times to prefilling orders on items that customers purchase regularly.
American customers are also more likely to return the products than Chinese customers, according to Li. Influencers are often paid as a percentage of their total sales, and product returns add a lot of complexity to this process. “It’s really difficult to profit in the livestreaming sale market in the United States,” Li says.
Social marketing expert Jiang has been working with several Chinese brands to boost their sales on Amazon and Shopify. She says she has found that American influencers aren’t willing to sign up with agencies, as their Chinese counterparts do, because they can already make a decent living as content creators.
TCG’s Goad also thinks it is hard to change consumer behavior. “The reality is our broader US commerce culture is very different from the rest of the world—a lot of Americans simply don’t want to be sold to and instead look for content that is adding value and educating them, or tells a personal story,” she says.”
There are also structural differences between the two markets. “In China, livestreaming emerged at a time when the number of shopping malls was still far lower than those of the US; there are about 24 square feet of retail space for every American, compared to just 2.8 square feet in China,” Howard Yu, Lego Professor of Management and Innovation at IMD Business School. “What livestreaming did was to step into the void in China, especially in rural parts of the country. Such an unmet need simply doesn't exist in the US.”
This means that conditions in the US just don’t add up to the moment that China was in when its own livestreaming boom began.
Influencers using TikTok Shop say they haven’t had much success so far. “The traffic isn’t great,” says Yu Lu, a UK-based influencer who works for an MCN in Shenzhen, and uses a VPN to sell on TikTok in the US. Her record audience was 280 people—her manager was really impressed by the number, she says. On March 1, she held a two-hour long session without a single person watching. “It is good if you can have like five people watching,” she says.
Like many other new Chinese influencers, she sells lingerie, which tends to have a relatively high profit margin and appeals to young women—the main audience for TikTok live streaming. She earns a fixed rate of £15 ($18) an hour, which doesn’t include the time she spends writing scripts, setting up, or collecting products to sell. The products she sells ship directly to customers from China.
Yu says the MCN she’s working for also works on Chinese streaming platforms but is expanding to new markets because the domestic market has become too competitive.
Despite the struggles that US companies have faced in replicating the success of China’s livestream ecommerce business, the saturation of the Chinese market is driving Chinese companies to try to crack America. One venture capitalist, based in Silicon Valley, speaking on condition of anonymity because she isn’t authorized to talk to the media, tells WIRED that she’s received dozens of proposals from Chinese entrepreneurs who want to set up agencies to recruit influencers or provide operational services like brand selection, script-writing, or logistics.
“But I am not so sure about if this idea would work in the United States. On one hand, it works really well in China, so I feel tempted,” she says. “But on the other hand, I am not so sure we can change American consumers’ behavior.”
