The next frontier for commerce
Article authored by Harshit Tahiliani, Associate, IvyCap Ventures
With the advent of e-commerce, consumers are always on the lookout for new products and platforms that are being designed to meet their needs. As a result of that, for brands to have a well-defined e-commerce strategy has become a default expectation as against it being an advantage. As the e-commerce industry evolves, brands have started to look out for innovative ways to engage and win their customers, leading the way for new ways of commerce to emerge.
Brand audience connect
Live commerce platforms allow brands to engage a real-time audience over live video sessions across streaming platforms — website, YouTube, Instagram, etc. — and drive consumers to transact during those sessions. Brands across industries such as apparel & footwear and home furnishing, amongst others, frequently organize “Drops” for customers at the time of new product launches or as discount-led virtual sales events. Similarly brands across industries that require a consultative approach to sales, such as beauty and personal care, are benefiting from live commerce platforms by having various product demonstrations and educational and Q&A sessions.
Current status quo
India’s Live Commerce industry is estimated to reach $4–5B in GMV by 2025. Within live commerce, fashion is expected to contribute 60–70% of the GMV while beauty and personal care is expected to contribute the remaining 30–40%. The industry is in early days globally expect for China, where with it’s evolving commerce landscape, the industry has witnessed a 280% growth in the live commerce market with the GMV increasing from $3B in 2017 to an $171B in 2020.
Amongst the early adopters in India, Flipkart has placed a bet on live commerce through its fashion lifestyle platform Myntra. In November 2021, Myntra launched a video live streaming and commerce platform, M- Live, allowing influencers, brands, and experts to host live concept and styling sessions. Flipkart aims to churn 1,000 hours of streaming per month and believes that social commerce is likely to engage up to 50% of its audience in the next 3–4 years. It also reported that Meesho is currently building its own live commerce platform.
Opportunities galore
The nascent stage of the industry in India provides a large opportunity for brands but also brings forth a few challenges. The audience’s understanding of live streaming is currently tied to Instagram’s live-streaming platform, limiting the traffic brands are driving to their own platforms. With first-party data not being available to brands and big tech players making tracking further challenging, brands will have to find new ways to drive traffic to their own platforms and build their own communities.
As e-commerce evolves and brands look for ways to engage and differentiate, and as consumers look for a more immersive shopping experience, live commerce platforms are set to gain traction. With emerging business models around live commerce, which one the industry adapts best remains to be seen.
About IvyCap Ventures
IvyCap Ventures — an early stage Venture Capital firm that nurtures entrepreneurs and their ideas into sustainable businesses, leveraging our Global Alumni Ecosystem.
