Livestream e-commerce sellers who are given access to real-time sales analytics can increase sales of certain products by approximately 20%, according to a large-scale field experiment conducted in cooperation with Alibaba. The study reveals that providing sellers with live data on customer engagement and purchases allows them to make more effective decisions during a broadcast, leading to a significant boost in sales efficiency.
This finding highlights a powerful synergy between technology and human intuition in the rapidly growing world of live online shopping. While platforms have become increasingly sophisticated, the success of a livestream event still hinges on the host’s ability to connect with an audience and adapt their strategy on the fly. By equipping these sellers with real-time performance data, platforms can empower them to refine their sales tactics moment-by-moment, capitalizing on emerging trends and maximizing revenue. The research demonstrates the concrete economic value of integrating advanced analytics directly into the user interface for sellers.
The Experiment with Alibaba
To measure the impact of real-time data, researchers collaborated with Alibaba Group on a randomized field experiment from December 1 to 3, 2020. Sellers on the platform were randomly divided into two groups. The treatment group was given access to a real-time sales dashboard for “presale” products—items that are promoted before their official launch. The control group did not have access to this information for the same type of products. This setup allowed researchers to isolate the effect of the data itself on a seller’s performance.
The study focused on presale products because consumers have less information about them, making the seller’s role in education and persuasion particularly important. The findings were unambiguous: sellers in the treatment group saw the sales of their presale products increase by about 20% compared to the sellers in the control group. The research concluded that this lift was primarily driven by an increase in sales efficiency, as sellers with data were better able to tailor their presentations to viewer interest.
Connecting Analytics to Instinct
The 20% sales increase was not achieved simply by displaying numbers on a screen; it was the result of sellers using that data to inform their intuitive decision-making in real time. The study suggests that live analytics empower sellers to identify which products are resonating most with viewers. This allows them to pivot their strategy instantly, perhaps by spending more time demonstrating a popular item, answering specific audience questions that arise, or creating a sense of urgency around a product that is selling quickly.
This dynamic transforms a broadcast from a one-way presentation into an interactive shopping experience. When sellers can see what customers are buying or saving, they can respond directly to the collective interest of the audience. This data-informed intuition is crucial in a live setting, where hosts must simultaneously be entertainers, product experts, and sales associates. The ability to see what works and what doesn’t in the moment allows for a more engaging and ultimately more profitable event.
The Live Commerce Landscape
The findings arrive as livestream shopping solidifies its place as a major force in e-commerce. Blending entertainment with instant purchasing capabilities, the format offers conversion rates that can be up to ten times higher than in traditional e-commerce. The market in China, a pioneer in this space, grew from $66 billion in 2019 to an expected $300 billion in 2021. This growth is fueled by the format’s ability to create a personal connection with shoppers, something often missing in conventional online retail. Consumers can see products in action, get their questions answered on the spot, and feel like part of a community.
Major companies have taken note. In 2020, the first 30 minutes of Alibaba’s Singles’ Day presales campaign on its Taobao Live platform generated $7.5 billion in transaction value. In the U.S., retailers like Walmart have piloted events on platforms such as TikTok, attracting significantly more viewers than anticipated and boosting their social media following. These successes illustrate the immense potential of live commerce to not only drive sales but also to enhance brand appeal and attract younger audiences.
Strategies for Driving Engagement
Success in livestream selling depends on more than just technology; it requires a deep understanding of audience psychology. A key tactic is creating a sense of urgency. Limited-time offers, one-off coupons, and countdown timers can tap into a viewer’s fear of missing out (FOMO), encouraging them to make faster purchasing decisions. Announcing when a product is low in stock serves a similar purpose, prompting hesitant buyers to act before it’s too late.
Interactivity is also paramount. The most effective hosts foster a two-way conversation, directly answering questions from the comments and making viewers feel seen and heard. This direct engagement builds trust and provides shoppers with the confidence they need to make a purchase, effectively bridging the gap between online and in-store shopping experiences. By demonstrating how a product works or how it can be styled, sellers provide a level of detail and authenticity that static product pages cannot match, which can lead to lower return rates. Ultimately, the research shows that combining these engagement strategies with the power of real-time analytics creates a formidable sales channel.
