- Facebook has announced that it will shut down its live markets by October.
- Business owners are now testing other apps to continue tapping into the $25 billion market.
- Creator economy expert Ryan Detert said the move opened the arena for other platforms to shine.
If there’s one thing the pandemic has taught business owners, it’s that adapting to unexpected changes is a critical skill for an entrepreneur.
So when Facebook recently announced that it would shut down its live shopping features by October to focus on Reels, some of its early adopters were surprised but not defeated.
“I was shocked,” said Britney Renbarger, its founder Pink Tag Boutique, a digital women’s clothing store. She told Insider that she started using live shopping for her business in October 2020. But as she committed to doing so, she quickly turned her focus to the other sales and marketing channels she was testing.
Live shopping is a technology that combines shopping and entertainment, allowing sellers to speak directly to their audience and answer questions about their products. Pandemic shutdowns accelerated the rise in US trend, with Coresight Research estimating the market value to be $25 billion by 2023.
But before suggesting that Meta’s decision is the beginning of the end for live markets in the US, Ryan Detert, the CEO of marketing firm Influential, offers a more optimistic outlook: It’s the beginning of a new era. that the US could finally catch up to China’s live streaming market. Meanwhile, entrepreneurs can still use technology to tap into a growing market to build loyal customer bases.
“People know the game is a multi-hundred-billion-dollar game — they’re not going to give it up,” Detert said. “Whether the platforms themselves provide the tools or outside third-party platforms, creators and brands will find ways to monetize these social audiences.”
Moving on to other platforms
Facebook wasn’t the only big company to explore live markets, so it makes sense to focus on features that are more likely to bring in revenue in an uncertain recession economy, Detert said.
When Insider reached out for comment, a spokesperson for Facebook’s parent company Meta said the company had “nothing else to add beyond the guidance we’re providing to Help Center article.”
Live streaming markets have been popular in China for over a decade, where the industry has been is appreciated worth $305 billion last year, up from $63 billion in 2019, according to Coresight Research. The US is three years behind China in the live market game, and this is evident not only in market value but also in the slow growth of consumer sentiment, Detert added.
“Consumers are going to operate in a slower way, whether it’s a big push from a social platform or these personalized companies,” he said. “The bigger question should be, how do you give the West the right fertile ground to deliver what the East has been able to deliver?”
Two charts show how the market value of live markets in the US trails the market in China by about three years.
Courtesy of Influential, McKinsey
For US consumers to reach Asia-Pacific shopping levels, Detert believes platforms like Facebook, Instagram and TikTok must have access to the precursor to live shopping, live streaming, he said.
“Everybody has a maker market now,” Detert said. “They’re all going to be live streaming, live shopping and shoppable video, and that’s where I think a lot of that will continue over the next 18-plus months.”
While most Americans aren’t yet ready to shop live, some consumers have shown interest in the entertainment-meets-shopping medium. Renbarger estimated that only 15% of her sales came from live shopping, but that the real return on her investment was the loyal customer base she had built from hosting weekly Facebook shows.
“When we’re online only, we don’t really have one-on-one interaction with our customers,” he said, adding that live shopping has built trust between shoppers and Pink Tag.
Kelley Cawley, a retailer, has seen enough interest in her Facebook Live broadcasts that she’s not ready to give up the channel. Last year, her daily shows increased her sales by 88%, she previously told Insider. He plans to continue making Facebook Live videos while using another platform for product sales.
“Our ultimate goal is to choose an option for our business that is extremely easy for the customer to switch to,” Cawley said.
A vibrant shopping renaissance
Detert said business owners had two options in this environment: They could continue to use the social media platforms that host live shopping or use one of the many apps, such as TalkShopLive, CommentSold or Bambuser, that integrate with Shopify and give businesses more control over data.
In fact, he thinks it’s the right time for startups to shine in the live shopping space, he said.
“This is going to be a renaissance for them for the next six to 12 months,” Detert added. “I wouldn’t be surprised if, at some point, some of these are acquired by some of the big platforms.”
Many business owners like Renbarger already use other platforms. He recently started using Cartr, an app that connects his Shopify store with videos he posts on Facebook.
“I’m really grateful we use Cartr,” he said. “We can still do live shopping, but then we also do TikTok and Reels.”
