Streaming Consumers in Livestreaming E-commerce: Identifying Lifts from Sales Pitches

Abstract

Livestreaming e-commerce is a trending marketing practice where consumers watch broadcasters' online sales presentations in real time and make purchases quickly in the showroom. Its success may be attributed to a variety of factors, such as discounted prices, an interactive shopping environment, and the influence of broadcasters as endorsers. This paper identifies the net effect of one such factor, the sales pitch, using consumers' streaming data from a leading livestreaming platform in China. Broadcasters launch a sequence of products during one show and sometimes have intermission periods between two products. What consumers see depends on the time they enter the showroom. We compare two groups of consumers: one entering the showroom during a product interval and the other during the following intermission, to examine the net effect of the sales pitch by broadcasters. We find that consumers increase their tendencies for product-page browsing by 1.93\% (21\% relative to an average level of 9.15\%) and their purchase likelihood by 0.91\% (136\% relative to an average level of 0.67\%) in one month following the show. The sales pitches tend to take effect through low-involvement learning, as they are more effective for low-involvement and hedonic products, and for pitches that exhibit features of low-involvement persuasion. The lift in sales volumes from pitches does not cannibalize those at the retailer or brand level, suggesting that new consumer acquisition plays a role. Further heterogeneous analysis suggests a stronger effect for consumers with higher engagement levels with the broadcasters, rather than with the brand. We also discuss the managerial implications of these findings.

Keywords: Influencers, livestreaming, Advertising, Natural experiments