This year’s Singles Day highlighted the growth of livestreaming e-commerce sales, fueled by virtual avatar hosts and AI chatbot use.

A recent McKinsey analysis showed that significant shifts in consumer behaviour in China led to a 19% surge in livestreaming e-commerce sales during the latest Singles Day shopping festival in November, while sales via traditional e-commerce channels dropped by 1%.

In total, Double Eleven sales across all platforms reached RMB 1.1 trillion ($155.3 billion) in gross merchandise value (GMV). Despite a modest 2% growth in this indicator, livestreaming sales notably surged, illustrating an ongoing move towards digital consumption channels.

Moreover, 2023 saw a rise in the use of innovative technology to boost livestreaming sales.

While the popularity of livestreaming hosts has been rising since 2020 when the pandemic brought an unprecedented e-commerce boom, today retailers increasingly test digitally created livestreaming hosts. Those can be either virtual avatars that copy an actual human host or unique virtual characters created from scratch specifically for e-commerce purposes.

Analysts note the improving quality of virtual shopping promoters, which become more akin to real people and behave more naturally. All the national e-commerce giants (e.g. Tencent, JD.com, Baidu) have reported using virtual avatars for livestreaming sessions this year.

For example, digital human livestreamer services are now offered to merchants for free on Baidu’s e-commerce platform. Avatars here are based on the same large language model behind the Ernie bot, using big data to create multiple livestreaming scripts in an instant.

The benefits of using virtual livestreaming hosts include reducing the cost of hiring a famous influencer, as well as the risks of unintended association with celebrity scandals.

Some Chinese retail companies are also leveraging ChatGPT-like artificial intelligence (AI) tools for their livestreaming events.

Livestream shopping is an e-commerce format which combines influencer marketing and social experience in a live shopping show on e-commerce platforms. It involves a celebrity host or an influencer who promotes a product through a live video. They demonstrate how to use a product, describe all benefits and product details, and communicate with the audience in real time.

Unlike traditional online shopping, potential customers are not observers but active participants. They may ask questions and interact with the host. Moreover, some brands might perk the stream with giveaways, or offer exclusive merch and content while streaming.