Livestream is flash sale on steroids⚡
Three men wearing strawberry hats sold over a thousand bottles in an hour on Facebook live. We couldn't sell more because we had no stock left.
👋 Ola! Welcome to Out of Singapore. I am Shantanu, writing about building businesses from scratch every week. I love my Saturdays - I get to write this newsletter out of great spots in the city. Today’s writing spot is the National Library. Several floors of peace, quiet and writing spots. Tons of books to go through. I want to spend a full day here without phone or a laptop, only reading books in the quietness. Although, I don’t quite like the area around library - one one side you have opulence (read five-star hotels) and on the other is Bugis, a super-crowded-noisy-no space to walk touristy area.
Before we move to the main story, tell me this
We stocked out⚡
For five days a week, I run a health supplements brand out of an industrial building. We are a new face, about 5 months old as of Aug 2023. We have struggled in terms of sale. Supplements requires a high trust level by consumers. After 4 months, we finally organised a livestream last Sunday.
We stocked out⚡
Yes, we stocked out. We sold more than the stocks we had, so we had to take pre-orders. We even took pre pre-orders with wait time of 1.5 months😅. Here is a snapshot from the livestream
Distribution channels for consumer brands
The common channels available to consumer brands are
DTC (via Shopify, BigCommerce or custom CMS).
Online marketplaces such as Amazon, Shopee, and Lazada.
Retail chains such as NTUC FairPrice, Guardian, and Cold Storage.
Offline distributors and resellers
Social commerce stores (Instagram shop, Tiktok shop)
Social comment or post shopping (I am still testing this)
Livestreaming or Live Sales
Live sales is updated version of tele-shopping or TV-shopping. Remember the TV channels which would show you products and ask you to call to order? There would be a toll free number where you call and the order is confirmed for delivery. I don’t quite remember how the payment was done since digital payment systems did not exist.
All these mediums take time to scale up. You start by listing your product, running marketing campaigns, drive traffic and then hope users to make a purchase. That get’s us to the main point.
Livestream is flash sale on steroids⚡
The possibility of a livestream is USD 1.7 Mn in sales. That’s the record set by the famous Chinese livestreamer Li Jiaqi in 2021. Top livestreamers in Singapore clock anywhere between USD 50K to 250K in less than 2 hours of live sales.
Traditional distribution channels are time taking, lot of process and boat load of costs that make selling not profitable. The blended ROAS (total sales/total marketing spend) is upwards of 50%, sometimes over 100% on DTC. To reach a USD 100K in monthly sales can take several months, if not years.
Livestream, on the other hand, has the fastest turnaround for sale. One hour of livestream can fetch you over USD 30K in GMV if you are new. If you slightly matured brand, this number can cross USD 100K. When you imagine from a new consumer brand perspective, these numbers are super high. A brand that does 1 mn in monthly GMV, makes 33K daily. With a livestream, you can make that amount in 1 hour!
You can achieve these results on livestream because you get
#1 Undivided attention of high intent shoppers
When you advertise on Facebook and Google, we are fighting for attention. It is constant struggle to win in a sea of choice.
On a livestream, you are the ONLY brand. The viewers are invested. A customer gets to know about the brand, gets all questions answered and is fighting for stocks with more shoppers eyeing the same brand.
#2 A Sensory explosion
The experience of shopping on livestream peaks our senses. It takes you out of the boring and static website product pages. Now you have a person holding the product, talking about it, breaking down the benefits, trying out the product, and making a pitch to you live!
One of our products is sold in pure powder. The taste is strong sour and slightly salty. The livestreamer tasted it and shared about it on the stream. Consumers started asking more questions on taste. It was instant gratification at a magnified level.
With so much sensory involvement, making a purchase is seamless decision.
#3 A competitive shopping contest
There were 200+ live shoppers on our livestream. Each of them competing for the stocks available for sale. This was not a awareness driving exercise, it was a flash sale. Everyone needed to make a decision fast, be faster than someone else on the livestream.
The comment section of our livestream is gold. There were 773 comments in under 2 hours!
Let me repeat. Livestream gives you
Undivided attention
Sensory explosion (and involvement)
Competitive shopping behaviour
Supply crunch is the final nail in the coffin. Our products ran out of stock in less than 2 mins. The moment a product was put up for sale, orders came crashing in and soon they were not able to order anymore. When one product stocked out so fast, it was clear that either one has to order within seconds or they won’t get the product.
To ensure customers are not dissatisfied, we offered pre order stocks. This stocked out as soon as it was released. 🤯
There are few more things that made this a success - a hero product, engaging sales person, the right consumer fit, existing demand in market and high trust relationship between customers and the livestreamer.
If you are interested, you can watch the whole experience here.
Thanks for reading today’s edition. It took me longer to write this time. I was sure of the topic but could not find the right presentation until today (it’s already Sunday).
In an other story, I hit 25 pullups this week. My fitness journey is going strong💪
I have lately been anxious and stressed. I have given up my calm demeanour. Calmness doesn’t seem to work at my workplace.
What shall I do when I am anxious? Simple ma, watch Jisoo 😍
Jisoo agrees 🙈
Hahah, okay bye! Have an awesome week ahead 🥂