A Chinese city to pump life into local business with WeChat live streaming

Rita Liao

China is showing renewed interest in live streaming. As the coronavirus swept through the country and shut down premises in droves, businesses are turning online to drive sales. Many have adopted live streaming, a model that predates the short videos that dominate many of our mobile screens now. Ecommerce titans like Alibaba, JD.com and Pinduoduo have ramped up efforts in live streaming, which sees customers interact with merchants and place orders in real time as many continue to avoid offline shopping.

An unorthodox player, WeChat, has also entered the fray.

The messaging giant, which commands 1.16 monthly active users, announced this week it's partnering with the southern Chinese city of Guangzhou to host a live stream shopping festival in June. The news arrived not long after president Xi Jinping acknowledged the essential role of live streaming ecommerce in the economy, especially in promoting sales of rural produce.

The initiative led by a municipal government to pump up the local economy through live streaming ecommerce is first of its kind in China. It should surprise no one that it's slated to take place in Guangzhou, a major trade and export center, as the global pandemic depressed China's outbound shipments, putting pressure on the authority to stimulate domestic demand.

Like most of WeChat's extended functions beyond messaging, live streaming is built upon the mini program -- or lite app -- infrastructure. The feature now sees registered merchants in the several tens of thousands and remains free to use during the testing phase, according to WeChat. Retailers in grocery, tourism and fashion are by far the biggest beneficiaries. Nasdaq-listed travel portal Ctrip, for example, has racked up nearly 100 million yuan, or $14 million, in sales by promoting live on WeChat as airlines and tourist attractions are shelling out deep discounts. Homegrown lifestyle brand Heilan Home recorded more than 3 million viewers in one live session. 

"In recent months, the demand for online shopping has surged due to the coronavirus pandemic. Selling through live streams is now a key way to help businesses reopen and resume production as well as stimulate consumer demand," Gerald Hu, general manager of Tencent Guangzhou, said in a statement.

WeChat came late to live streaming. Despite years of hype around the sector, the social networking giant waited until this February to formally introduce live streams to its all-in-one platform. That in part could be a result of founder Allen Zhang's minimalist and perfectionist approach to products.

After all, the core of WeChat is to facilitate communication among acquaintances. Other features like shopping and gaming are an extension of the socializing experience and are designed to complement not obstruct chatting. People might purchase the snacks their friends share with them through a WeChat message, or accept friends' invitation to join an in-app game on WeChat, but how many want to spend 30 minutes focusing on a video and risk missing important messages?