[MICE Trend] Live commerce as part of the exhibition, admittedly establishing itself as the main trend in a year?
Promotion and sales of products on a live broadcast of exhibition/
Joined by platform companies such as Naver, Kakao, and others/
Drew interests of the MZ generation who are familiar with video and mobile
"Hello, everyone. Did you enjoy browsing the exhibition booths at the Cafe Show? If you look around here...(the camera zooms in the back of the narrator), I would like to introduce a brand that has studied a lot on the coffee beans. (Reading the live comment) A participant mentioned a craving for dripped coffee. Let me explain one by one." (from 'Live Commerce' at 2020 Seoul Cafe Show)
Live commerce is a coined term of Live, meaning real-time and e-Commerce. It settled down quickly in the Korean market, used to TV home shopping, online and mobile markets. Representative live commerce services are Naver's 'Shopping Live,' Kakao's 'Shopping Live[HE1],' CJ Olive Young's 'Ol-Live,' Timon's 'TV On,' and Coupang's 'Coupang Live.' The live commerce market is booming as large platform companies like Naver and Kakao joined. Customers connect to a specific platform at a scheduled time to see the products on sale and listen to the host's narration. Customers can add comments and make inquiries to do thorough research before purchasing the product. Although optimized for the mobile platform, the service is accessible via the web with little difficulty. Customers may buy the product at a lower price using different event coupons.
Last year's Korean live commerce market is sized from 3 to 4 trillion won depending on the institution. Many expect it to grow to 8 to 10 trillion won by 2023. As live commerce picked up, manufacturers of consumer goods such as cosmetics and food and TV home shopping companies joined on the bandwagon by using their own platforms. In such a smooth sailing, live commerce is expected to be on the rise for a while since its primary target customers are the MZ generation, who are very familiar with obtaining information and purchasing via video.
Real-time non-face-to-face shopping 'live commerce' is emerging as a breakthrough of the MICE industry amid the prolonged COVID-19 pandemic. Last year's live commerce was one of the methods to activate the rarely visited exhibition halls. However, it appears to serve a specific purpose as 'live commerce 'is directly correlated with the sales of exhibitor's products. 'Live commerce' is expected to play a significant role in the MICE industry's exhibition sector during the coronavirus era, just as the video conference in the meeting industry.
According to the Association of Korea Exhibition Industry(AKEI), the Korean exhibition industry responded to the COVID-19 outbreak merely by postponing or canceling the exhibitions last November. As of October last year, 326 exhibitions, 65% of the 509 planned exhibitions, were delayed or canceled. Against this backdrop, 'live commerce,' a pilot project attempted at a few exhibitions, was well received as a new potential and became a center of attention.
17compnies participated in three exhibitions last year
'370,000 views, 640,000 likes, 170,000 comments'
The first attempt of Korean live commerce was at the 38th Baby Fair held at COEX between the 20th and 23rd of August, 2020. Kakao Commerce ran 'Kakao Shopping Live' jointly with Befe Inc. for two days from the 22nd of August. It sold products of exhibiting companies via 'kakatotalk shopping' after the Baby Fair concluded. The largest Asian coffee exhibition, '2020 Seoul Cafe Show', was held at COEX on the 4th ~7th of November same year and saw Naver Shopping Live engaged by a score of exhibiting companies. Subsequently, Korea International Furniture & Interior Fair (KINTEX, 19th~22nd of November) and Suwon Pet Show (Suwon Convention Center, 27th~29th of November) also showed their participants products on Naver Shopping Live. AKEI announced that 17 companies from three exhibitions aired the live commerce and achieved a historic record of 370,000 views, 640,000 likes, and 170,000 comments.
This past February, AKEI and Naver Shopping Live signed an MOU to promote hybrid format exhibitions linking exhibition and live commerce. AKEI would be responsible for identifying and selecting exhibitions to air live commerce on and planning and making its content. Naver would provide the online streaming platform and technology as well as promotion support, such as banner advertisements on the Naver Platform. A wide variety of exhibitions this year utilized live commerce under the MOU. Those exhibitions were SPOEX 2021 in February, exco BeKi in March, Coffee EXPO Seoul in March, and Seoul Living Design Fair (May). This year's live commerce included a new trial of broadcasting all exhibition booths.
What is so special about live commerce that customers are reacting to it? The Knowledge Management Society of Korea published an interesting research result in its academic journal 'Knowledge Management Research.' According to the study 'Investigating the Factors Influencing the Use of Live Commerce in the Un-tact Era' by Professor Ae-Ri Lee of Sangmyung University, factors like two-way communications, immediacy, or remote presence do not carry significant influence over consumers' purchase decision. Instead, different interactivity features, such as displaying detailed information upon click or chatting rooms that customers can control themselves, appear to influence purchase intentions. Seemingly unbiased product reviews also had a significant impact on purchases.
Particularly, environmental factors that convey the warmth of people and the sense of social belongings or 'togetherness' were as important as convenience. Professor Lee emphasized, "Live commerce takes place in a non-face-to-face environment. However, hosts chitchat with customers participating in real-time and bring them together, increasing the feeling of social belongings. These features help communicate authenticity and validity to customers, which is the most decisive factor in driving repeat purchases."
The MICE industry has now entered into the live commerce market. How far can the industry extend from the current B2C-focused consumer goods exhibition? Experts pay attention to the scalability of live commerce. What matters is the potential synergy that brings up the value of exhibition. Hee-Gon Hwang, professor of the Convention and Event Management Department at Hallym University of Graduate Studies, diagnosed, "live commerce is expanding in the exhibition industry and an undeniable trend. However, it may cause damage to the original purpose if only a few selected companies are promoted, when exhibitions are about seeing products of many different companies to encounter surprises and become immersed. He added, "It is about time that we defined values of off-line exhibitions and online live commerce respectively and thought about how to create synergy."
Recent estimates predicted the Korean live commerce market would grow to 25.6trillion won by 2025. Future Media Institute analyzed in its industry analysis report 'Live commerce rising as a trend in the post-Covid era' that live commerce can be categorized into five types based on its platform: large distribution companies, existing e-commerce, large portals, live commerce specific platform, and SNS. Different platforms will leverage their strength and weakness in their differentiation strategy.
The prospects of the US market are promising. With the likes of Amazon and Google commencing live commerce, the market is expected to grow significantly. Social media channels also signal the introduction of live commerce, and exhibitions targeting B2C will actively seek ways to link live commerce.
B2B marketing also saw over and over the positive impact of digitization of marketing and sales on earnings. It is analyzed that B2C marketing consumers themselves are contact points of B2B business target, hence more far-reaching power. Consumers are getting used to digital marketing, which allows easy access to not only the product information but also other purchaser's reviews. The exhibition industry should keep abreast with such changes and identify how to connect participating companies and their customers effectively. In this vein, live commerce will be an attractive option for hybrid-format exhibitions where people visit the exhibition hall to see and experience the products while products are sold online in real-time.