---
title: "Three Live-Streaming Worlds, Three Business Models"
description: "Live-streaming commerce, ignited by internet celebrities, has now diverged into two worlds and two types of live-streaming. A third type is emerging and may become the new mainstream. The first world is 'live-streaming influencers,' parasitic on major platforms. The second world, such as Yiwu's 'live-streaming villages,' receives little media attention. The third..."
author: "刘春雄"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2020-09-26"
language: "en"
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# Three Live-Streaming Worlds, Three Business Models

> Live-streaming commerce, ignited by internet celebrities, has now diverged into two worlds and two types of live-streaming. A third type is emerging and may become the new mainstream. The first world is 'live-streaming influencers,' parasitic on major platforms. The second world, such as Yiwu's 'live-streaming villages,' receives little media attention. The third...

Live-streaming commerce, ignited by internet celebrities, has now diverged into two worlds and two types of live-streaming. A third type is emerging and may become the new mainstream.
**The first live-streaming world is 'live-streaming influencers,' parasitic on major platforms.** This is the focus of media attention, the selling point of platform traffic, and the hotspot for companies competing to 'fill the pit.'
**The second live-streaming world rarely receives media attention, and it's hard to be high-profile.** For example, in Yiwu's 'live-streaming villages,' every household does live-streaming, and it has become the mainstream business model for some companies.
**The third live-streaming world is taking shape.** Dong Mingzhu's live-streaming has shown many the prototype of brand-owner live-streaming. But because of Dong's dual identity as a celebrity chairwoman, her role as CEO of a brand is overshadowed by her celebrity status.
**The highlight of live-streaming may be in the third world.**
**-01-
Live-streaming influencers evolve toward 'new manufacturing'**
It's barely plausible to call live-streaming new retail, but how can we say live-streaming influencers evolve into new manufacturing?
In live-streaming influencer commerce, well-known brands are increasingly rare, and products are mainly in highly fragmented industries. Such industries were long-tail in the past, but now they are the best for live-streaming influencers. **Because the survival rule in long-tail industries is not good brands, but good products.**
Live-streaming influencers start by selling others' (brand owners') goods, then shift to selling their own (new manufacturing supply chain) goods. **This is the inevitable logic of influencer evolution.**
'In a decentralized world, create a bigger center.' Billion-yuan brands lose the spotlight, while influencers with tens of billions in sales dominate media headlines. This is the 'media darling' created in a decentralized landscape. This is true of any attention economy.
Despite the current media influence of influencers, what share do they actually hold in the commercial world? How much do they contribute to the overall economy? Will they become 'living Lei Feng' for big platforms like the many 'Taobao brands' of the past? **We need to deeply analyze the impact of live-streaming influencers on business.**
## **1. Live-streaming influencers are small platforms parasitic on traffic giants**
This sentence has three keywords: **influencer small platform; traffic giant; parasitic.**
An influencer can be seen as a small retail platform. The influencer is a retailer, constantly selecting quality products to recommend to users.
It's important for brand owners to understand this. **Influencers choose brands not to endorse them, but as a 'batch retail' promotion activity.** Except for dual-identity influencer-chairmen like Dong Mingzhu, live-streaming influencers are not 'spokespersons' for any brand; the 'slot fee' is essentially no different from the traditional KA 'entry fee,' except for the amount.
Traffic giants, including Alibaba, Douyin, and Kuaishou, have the ability to direct traffic but also face the dilemma of traffic exhaustion. **Platforms have large traffic and need influencers to monetize it. Traffic is exhausted, and influencers are needed to activate it.**
What is the relationship between influencer small platforms and traffic giants? I used the word 'parasitic.' **Without traffic giants, influencers find it hard to monetize. Without influencer activation, platform activity rates decline.**
**Since it's parasitic, it's difficult for influencers to go solo. Without the strength to 'switch channels,' they risk being 'banned' by platforms.**
## **2. Live-streaming is influencer monetization, not brand monetization**
In influencer live-streaming, fans trust the influencer, not the product. Trust in the product is a transfer of trust in the influencer. Live-streamed products are either well-known products at 'lowest price across the internet' or low-awareness products where users don't care about the brand.
**Influencers can monetize because it's the result of continuous trust-building and strict product selection.** Top influencers have a sea of products to choose from, a strict selection process, and rich experience. Many celebrities fail on their first live-stream because they can't select products or have no products to choose from.
**Since it's influencer monetization, users won't transfer their trust in the influencer to the product or brand.**
## **3. Influencers can drive traffic, but they neither save brands in times of need nor add glory in times of success**
In the first half of this year, many startups hoped to rely on influencer live-streaming to become famous overnight. Now it seems they expected too much.
A single live-stream by a top influencer can sell over 100 million yuan, but that's the total sales of dozens of products. Whether an influencer can launch an unknown brand is still unknown, as there are no such cases. **After all, live-streaming is influencer monetization, not brand monetization.**
**The contribution of influencers to brand owners is reflected in four aspects:**
**First, 'one-time sales volume.'** After deducting slot fees and commissions, brand owners often lose money. Therefore, whether it brings benefits beyond sales is key for brand owners;
**Second, influencer fan retention.** If the influencer's fans match the brand, some fans can be retained. So far, overall retention rates are very low;
**Third, brand exposure.** Live-streaming increases brand exposure. For big brands, exposure needs are not strong; for emerging brands, one live-stream offers limited exposure. Unless the live-stream itself becomes a topic, like Wu Xiaobo's famous 'fifteen cans' after his live-stream 'crash';
**Fourth, increasing e-commerce store weight.** But platforms have already introduced measures to reduce the weight of off-site traffic.
## **4. Brand owners distance themselves, new manufacturing supply chains emerge**
**The relationship between influencers and brand owners is changing.** The 'lowest price across the internet' approach is not beneficial to brand owners. Especially as influencer fans become more 'private-domain,' dependence on platform traffic and brand endorsement decreases.
Top influencers are transitioning from retail platforms to '**new retail + new manufacturing**' platforms, because most live-streamed categories are low-awareness, and influencers have formed independent supply chains, bypassing brand premiums. Influencers have become 'cross-category influencer brands.' Ma Yun's dream of 'new retail + new manufacturing' is taking shape among top influencers.
As the influencer trend recedes, the landscape of top influencers is set. Top influencers evolve toward new retail, and well-known brands begin to keep their distance. Keeping distance doesn't mean not doing live-streaming. **Brand owners distancing from influencers is precisely the start of their normalized live-streaming. 'Store live-streaming' is the normalized form for brand owners.**
**-02-
Vibrant 'live-streaming villages,' live-streaming as a channel**
Unlike the over-attention on influencers, some places, like Yiwu in Zhejiang, have '**live-streaming villages**' where every household does live-streaming. It has become the norm for business.
Many in influencer live-streaming are motivated by 'losing money for publicity.' But in 'live-streaming villages,' live-streaming is business; they don't do things that don't make money.
**This type includes both 2C and 2B live-streaming. 2B may even be the focus.**
2C live-streaming is the normalization of e-commerce platform live-streaming. **Previously, e-commerce sold images and text; now they sell live-streaming. Live-streaming doesn't require celebrities; the boss lady or store staff can do it, at most hiring an unknown but skilled small influencer from an MCN agency.**
**2B live-streaming solves channel problems for many small businesses.** China has too many industrial clusters. Every county in Zhejiang has at least one industrial cluster, and Yiwu has countless in small commodities. Henan's GDP has consistently ranked fifth nationally, partly because it has over 200 industrial clusters, averaging two per county.
Within industrial clusters, there are many small and medium enterprises without brands, sales teams, or complete sales networks. **Their business mainly comes from three sources: 1. OEM for local branded companies; 2. Wholesale to the whole country through various wholesale markets; 3. A few salespeople directly facing agents and end customers in various regions.**
Live-streaming villages are especially prosperous in industrial cluster areas, mainly focusing on 2B live-streaming.
The smaller the enterprise and the more lacking in traditional networks, the better the effect of 2B live-streaming. The barrier to entry is low, and the influence among enterprises in a cluster is strong. If one is effective, others follow.
**To some extent, live-streaming is an online sales (wholesale) network for small businesses. Deep distribution requires strong channel teams and organizational management, while live-streaming only needs a few people to form a sales network. It's a lifesaver for small businesses.**
**-03-
Live-streaming enhances deep distribution, BC integration**
Dong Mingzhu's live-streaming initially used her celebrity status, but the first broadcast was poor, selling only 230,000 yuan. On '6·18' in 2020, she sold 10.2 billion yuan.
Soon, experts noticed that Dong's live-streaming differed from ordinary influencers; the main traffic didn't come from fans but from 'organized traffic' from offline channels. **The model is: traditional channels direct traffic, Dong Mingzhu monetizes through live-streaming.**
**This is a typical combination of traditional channels and live-streaming tools. Unlike influencer live-streaming, Dong's is a combination of B-end (channels and stores) and C-end (from stores to users), a BC-integrated live-stream.**
Earlier, Mousse mattress completed a live-stream on March 3-4 with 4,000+ stores and 1.5 million KOCs, achieving 128 million information touches and over 100 million in sales. It was also BC-integrated.
Since late May, Xiaoshile, known for new marketing since 2017, has used live-streaming tools for BC-integrated live-streaming. They use the county as a unit, combine local small influencers, and through 'hundreds of stores linked, thousands of groups resonating, ten-thousands of people live-streaming,' this BC-integrated approach activates terminals and achieves sustained sales growth.
Xiaoshile's logic: first connect C-end through terminals (B-end), then create C-end momentum through live-streaming, directing traffic to B-end, thus activating terminals (like restaurants and retail stores).
Because a county-level terminal can be activated in less than a week, they call this '**flash live-streaming**.'
BC-integrated live-streaming can be used for periodic sales, like Dong and Mousse, or combined with deep distribution, focusing not on sales but on terminal empowerment.
In deep distribution, terminals are the end. With live-streaming and deep distribution, BC integration makes terminals the starting point.
**BC-integrated live-streaming starts at the terminal and ends at the terminal. It starts from the terminal and strengthens it. Live-streaming is an effective tool for channel operations.**
**-04-
Three live-streaming business worlds**
Live-streaming is an efficient business tool, not exclusive to influencers. **From the brand owner's perspective, there are three business models:**
**First, for small and medium enterprises, live-streaming is an online channel.** In Chinese FMCG marketing, channel driving is essential. The core of smallness is weak channel organization and management.
As a communication tool, live-streaming is less effective than face-to-face but more effective than other methods (phone, WeChat). Therefore, small businesses are happy to build online networks and maintain customer relationships through live-streaming. Of course, penetration is sufficient, but online live-streaming channels still lack the strength to compete with offline channels.
**Second, for strong brands, live-streaming is a rare tool to strengthen channel driving, promote deep distribution to C-end.**
Since advocating new marketing, we've pushed for online-offline integration. In 2020, we found live-streaming an effective tool. BC-integrated live-streaming has complex technical paths and is highly professional, not attracting media attention. But it's an efficient tool for brand owners, whether for recruitment, new product launches, or holiday activities. After months of practice, we've summarized a model.
**This model is a three-step online-offline integration: experience as the opening move, thoroughly doing one store, and exploding one county online. The main tool for explosion is live-streaming.**
In promoting the live-streaming model, we've also summarized three strategies: **single-store rolling, small-area rolling, and national sensation.**
**Third, as a platform retail tool, live-streaming will see two trends: first, brand owners normalize live-streaming, with 'store live-streaming' as standard and internal live-streaming teams as standard; second, top influencers will evolve from 'helping brand owners sell' to 'building their own supply chains,' marginalizing brand owners.**
Source: Teacher Liu's New Marketing (ID: liuchunxiong1964)


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