Fleeting or Lasting Success? Unlocking the Power Durability of Live Commerce

36 Pages Posted: 8 Jan 2025

See all articles by Yipu Deng

Yipu Deng

HKU Business School, The University of Hong Kong

Jinyang Zheng

Purdue University - Krannert School of Management

Guoxin Li

Harbin Institute of Technology

Weilong Wang

University of California, Berkeley

Karthik Kannan

University of Arizona

Date Written: November 13, 2024

Abstract

Live streaming has emerged as a powerful marketing tool for product promotion, with increasing adoption and usage frequency among e-commerce sellers. However, the heavy reliance on live streaming raises questions about its cost-effectiveness and the durability of each live streaming session's impact. This study answers these questions by examining the temporal patterns of individual live streaming session's sales effects and unraveling the mechanism (i.e., the distinctive nature of live commerce) that underpins such patterns. Collaborating with a large Asian live commerce platform, we synthesize a quasi-natural experimental setting and reveal a significantly positive yet short-lived sales effect, with no lasting effects beyond the session day unless followed by another live streaming session. This pattern indicates that real-time interactions, which bring entertainment value and engagement, play the primary and distinctive role in driving sales and generating value within frequent live streaming contexts. This mechanism overshadows potential cascade effects from increased awareness through influencers or learning effects due to reduced uncertainty through video content. Further analysis regarding the necessary conditions for these mechanisms indicates that the sales boost is moderated by the level of engagement during sessions, rather than the extant information about the seller and product. Also, the first session does not exhibit an incremental sales effect. Together, these findings reinforce our proposed mechanism. These findings add to the literature on live commerce and influencer marketing, shedding light on the evolution of live commerce. They also provide valuable guidance for the strategic use of live streaming, including considerations of timing, format, influencer selection, and interplays with other marketing strategies, which is crucial for live streamers, marketers, sellers, and regulators.

Keywords: Live Streaming, E-commerce, Quasi-experiment, Temporal Pattern

Suggested Citation

Deng, Yipu and Zheng, Jinyang and Li, Guoxin and Wang, Weilong and Kannan, Karthik, Fleeting or Lasting Success? Unlocking the Power Durability of Live Commerce (November 13, 2024). Available at SSRN: https://ssrn.com/abstract=5018972 or http://dx.doi.org/10.2139/ssrn.5018972

Yipu Deng (Contact Author)

HKU Business School, The University of Hong Kong ( email )

Hong Kong
China

Jinyang Zheng

Purdue University - Krannert School of Management ( email )

West Lafayette, IN 47907-1310
United States
7654966221 (Phone)
7654966221 (Fax)

HOME PAGE: http://https://www.krannert.purdue.edu/directory/bio.php?username=zheng221

Guoxin Li

Harbin Institute of Technology ( email )

92 West Dazhi Street
Nan Gang District
Harbin, heilongjiang 150001
China

Weilong Wang

University of California, Berkeley ( email )

Karthik Kannan

University of Arizona ( email )

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