8 top learnings from MW immersion: live commerce (Hangzhou)

We have just completed MW Immersion: Live Commerce [Hangzhou]!

Over 3 days, leaders & decision makers from Southeast Asia and India participated in over 10+ visits, sharings and networking events, including exclusive visits to all of the top 3 MCNs in China: Yowant, Befriends and Joy Media.

Here are some of the key learnings:

1. Digital humans/AI still accounts for <1% of total live commerce in China:
   However, since March there has been a significant breakthrough in AI for video generation. Brands and marketers will save a lot of time and resources by using AI to generate unlimited promotional short videos;
2. What makes a top live commerce host/KOL? Is it appearance, EQ, talent or training? Two top MCNs told us that these are merely basic requirements. The most important trait that differentiates a top host/KOL is aspirations and hard work. This can be identified;
3. The MCN business model continues to evolve:
   All top MCNs we have visited have evolved to more than just talent network and live ecommerce, into areas such as brand building, supply chain management and many more, depending on their respective (and differentiated) strengths;
4. Platform’s sustained investment was vital for live commerce to take off:
   A question many asked is why live commerce hasn’t taken off in other countries, despite some attempts by platforms. A consensus response from Chinese players is that the platforms need to have the commitment to invest despite initial low or negative ROIs. It takes time for the ecosystem to form and start spinning on its own.
5. Ecommerce platforms evolve to control the supply chain:
   They do not have a choice (no pun intended). Pinduoduo/Temu is moving aggressively into that area – if others (Alibaba and JD) do not follow, they will lose out in efficiency;
6. China’s scale is unique, which is good for local players in other countries;
   Scale makes a lot of business models possible in China, and only in China. Chinese players, who are used to playing at scale, find it difficult to operate effectively on their own at smaller markets. They need partners;
7. Southeast Asian players should go directly to the Chinese supply chain, instead of Chinese brands to look for products;
   Many Chinese new brands are not recognised in Southeast Asian markets. When local MCNs work with them, a key challenge is who pays for brand building in the market, and invests in inventory.
8. Pinduoduo already has >100m video DAUs
   For Temu, video is just a matter of time.

One key question that Southeast Asian MCNs asked: How do you turn around a KOL if they are not performing well? At which point will you give up?

The answer: there is a formula based on efficiency, and luck. Joy Media shared the details in the closed door session.

Check out highlights of the immersion:

Thank you to all participants and partners who made this immersion such a fruitful one!!

In the coming weeks, we will release more articles/podcasts featuring insights and key questions during the immersion. Stay tuned!

We are planning a few more immersions in Q3/4 this year (ecommerce, retail, live commerce). Register your interest by filling in this form and we will share more detail with you!