Wu Xiaobo is a famous finance and company-focused writer, with a brand built on bestselling books and an annual year-end show in which he shares insights into the business world. So of course, he figured he could sell milk powder. Spoiler alert: he was wrong.
Like thousands of other Chinese celebrities and online personalities, Wu was venturing into livestreaming e-commerce, a mashup of online chat show and QVC-style hard-sell advertising that’s become the hottest thing in the world of Chinese marketing in 2020. Livestream e-commerce shows have reached dizzying sales figures, with celebrity salespeople like star influencer Viya regularly selling RMB 72 million ($10.3 million) in a three-hour show.
Other business figures have tried their hands as celebrity spokespeople. Dong Mingzhu, chairwoman of home appliance manufacturer Gree Electric, sold RMB 310 million worth of goods in a three-hour live stream in May. As Wu has said, “You are not living the year 2020 if you have never watched or hosted a livestream session” (our translation).
Wu’s June 29 debut on Taobao Live, the Alibaba-owned platform that accounts for nearly 60% of the market by transactions, was much anticipated. Themed on promoting “new national products” from Chinese domestic brands, the stream was advertised on billboards at train stations and airports, while Taobao Live promised to do everything it could to push users to view. Wu himself spent over a month preparing.
34 brands paid up to RMB 600,000 for a spot on the five-hour show, with the cheapest “flash sale” slots going for RMB 300,000. While exact figures were not announced, if each of the 34 merchants paid the lowest price Wu would have earned RMB 10 million for the show.
It was a commercial flop. Even though 8.3 million people tuned in to watch Wu pitch products like milk powder, snacks, and bedsheets, they bought only RMB 22 million worth of featured goods. One brand representative told local media that it paid the full RMB 600,000, and earned less than RMB 50,000 during the event, far short of the company’s sales target of RMB 1 million to RMB 1.5 million. Yashily, one of the brands that paid to be featured, sold only 15 tins of milk powder.