Liu Qiangdong’s First Live Stream: What’s the Signal?

Liu Qiangdong's First Live Stream: What's the Signal?

By Yuan Ming from Sina Technology

“3! 2! 1! Here’s the link!”

Last night, Liu Qiangdong’s AI digital persona (hereinafter referred to as “Liu Qiangdong”) made its debut.

Although there have been many “avatars” of celebrities and top anchors active in live streaming rooms before, the appearance of a “stand-in” created by technology for the e-commerce giant’s number one position is historically unprecedented.

What signal does Liu Qiangdong’s live broadcast really send?

Not all categories are suitable for “Liu Qiangdong”

At 6:18 last night, “Liu Qiangdong” appeared in the live streaming room. In less than 50 minutes of live broadcasting, “he” shared his exercise habits, repeatedly praised the excellence and efforts of “Cai Xiao Brothers,” and quickly introduced several brands of air conditioners and televisions from Hisense, Midea, and others.

There are two completely different opinions in the industry about this live broadcast mode.

Some people believe that the use of new technology for digital person live streaming is a good business. This mode of live streaming is replicable, cost-effective, and can fill the idle time slots after real people’s broadcasts. With a large number of self-operated products on JD.com, employing numerous anchors for explanations is costly. Using digital persons for live streaming can embed them in many products.

However, some people bluntly say that emotional communication is most needed for live streaming sales. For example, Li Jiaqi gained huge attention by interacting with fans. But it’s difficult for digital avatars to establish a connection. It might work for novelty, but lacks longevity.

In fact, Sina Technology found during the live broadcast that “Liu Qiangdong” only had a few movements and expressions throughout, and the tone was also stiff. Although there was interaction with netizens, it seemed no different from reading a script, rather than genuine interaction.

According to statistics, 20 million viewers watched this live broadcast, and Liu Qiangdong’s popularity is beyond doubt. However, in the process of widespread promotion in the future, consumers are inevitably prone to visual fatigue towards him. After all, the most important function of live broadcasting is real-time interaction and providing emotional value.

More importantly, not all categories are suitable for AI live streaming. Some analysts believe that AI live streaming is more suitable for products with strong technical characteristics, such as electronics, etc. However, it is still difficult for AI live streaming to achieve widespread popularity in more personalized categories such as clothing and cosmetics.

JD.com previously stated that after uploading product links in the live broadcast backstage, Yanshi digital persons can intelligently “read” product details, find key specifications, selling points, and other information, and automatically generate live broadcast copies, broadcasting 24 hours a day. The script that merchants needed five hours to write can now be generated with one click, improving the efficiency of live room operation; the cost of virtual anchors is less than one-tenth of that of real persons.

However, there doesn’t seem to be an obvious response from the capital market to the debut. JD.com announced the launch of AI Liu Qiangdong’s live broadcast on the evening of April 15th. As of the close of April 16th, JD Group’s stock price fell by 2.3% to 98.85 yuan.

Liu Qiangdong's First Live Stream: What's the Signal?

Repeatedly Emphasizing “Low Prices,” JD.com Is Being Chased All the Way

During the live broadcast, “Liu Qiangdong” repeatedly mentioned words related to “low prices,” such as “offering benefits to consumers,” “bringing low-priced goods to consumers,” “affordable prices,” etc. It’s not hard to see JD.com’s current eagerness to promote “low prices.”

It is well known that Pinduoduo, which relies on low prices, dealt a heavy blow to JD.com. According to the financial report data of 2023, although Pinduoduo’s total revenue is less than JD.com’s, its revenue increased by 90% year-on-year, and its net profit margin is 24.2%, while JD.com’s corresponding figures are 3.67% and 2.23%, respectively.

Faced with rapidly growing competitors with higher profit margins, offering low prices has become something JD.com must do.

Previously, JD.com mainly relied on self-operated businesses and pursued a route of quality e-commerce, limiting the space for the implementation of low-price strategies. In 2023, JD.com launched the “Hundred Billion Subsidy” strategy. JD Group CEO Xu Ran also stated at the financial report performance conference that in 2023, JD.com would accelerate the construction of platform ecology and low-price mindset.

However, relying solely on JD.com’s own subsidies to cut prices is not enough. Over the past year, JD.com has taken various measures to attract 3P merchants (third-party merchants) to join. Specifically, JD.com has provided fairer traffic policies to 3P merchants, allowing 1P (self-operated merchants) and 3P to compete. Whoever has lower prices and more product choices can get more traffic bias.

Previously, JD Group CFO Shan Su also stated that the focus in 2024 would be on attracting more small and medium-sized businesses in industrial belts to join and enriching the supply of goods.

In this live broadcast, “Liu Qiangdong” also mentioned that JD.com does not charge pit fees for procurement and commission for influencers. While offering benefits to consumers, it also attracts excellent merchants to join. Financial data shows that the number of 3P merchants on JD.com increased by 188% in 2023, and the number of new merchants increased by 4.3 times in one year.

Currently, JD.com is still in the midst of being chased by competitive products. Although the strategy of low-price subsidies and attracting merchants has caused JD.com to “bleed” in terms of operations, it is a necessary “pain” in the long run.

Can “Liu Qiangdong” become a tonic for JD.com’s counterattack? We still need to wait for time to give an answer.

Responsible Editor: Hao Xinyu

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