This Live-Stream Entertainment Shopping Company Wants to Bring Live-Host Commerce to the World
Source: Streetwise Reports
October 6, 2021 (Investorideas.com Newswire) Shopping meets entertainment meets community in the latest form of online commerce: The live-host sector has mesmerized China and is now finding happy shoppers in the U.K., South America, and worldwide.
Entertainment will be the new "e" in ecommerce if trends that started in
China gain traction the way the cofounders of OOOOO Entertainment Commerce Ltd. (OOOO:TSX.V) expect; the live-streaming shopping app - which is basically a virtual video mall - "allows brands to engage and sell to consumers in a new way."
This form of live-streaming commerce features creators and influencers hosting their own shows on a dedicated channel. It's "a modern version of QVC on a streaming app," according to OOOOO cofounder Sam Jones, formerly of well-known Wish and Ballr.
OOOOO Entertainment Commerce's technology gives key opinion leaders and influencers a platform to create, edit, and share opinions in short, live videos that highlight specific products. In addition to being posted on OOOOO's own channels, the videos are shared across the hosts' own social media networks.
Expanding the Platform to New Audiences
"So you open the [OOOOO] app and notice a show about earrings. You weren't thinking about earrings, but you are drawn in by the host telling you a story about these earrings. You watch. You click. You buy," says Jones.
OOOOO will establish production studios in the U.K., and through its gamified platform, it will engage content creators, introduce merchants, and produce high-quality content. As part of the collaboration, OOOOO will receive compensation for these services.
In addition, the firm is building several studios in the U.K. "Some of the sellers are not set up to be the creators of live content," Jones said. "We're very early in this space in the UK and lots of the sellers do not have the infrastructure or the people who are properly trained in running live shows, so we felt that it was crucial for our company to build several studios in the U.K. that can be our hub where we can bring clients and allow them to learn and study the data and the insight while they're making that content."
Building the Brands
OOOOO launched its first channel, cosmetics.tv, in the U.K. in November 2020 and quickly displaced Amazon at the top of that country's Shopping Top Choices on iOS. The app now boasts more than 200,000 viewers and customers in the U.K.
Jones likens the company's growth strategy to the development of a mall, first building out anchor tenants, the biggest, most frequented stores. But there's no old-school department stores here.
The company has initially focused on three major categories: sports, fast fashion, and beauty and wellness. OOOOO landed the biggest sports company in the U.K. - JD Sports, which also has shops in Europe, the U.S., Asia, New Zealand, and Australia - along with leading fashion players BooHoo, ISAWITFIRST, and Missguided Ltd.
"These companies bring their own Instagram … following, and they have an army of influencers that serve them. The reason we like fast fashion is that the turnover of content and product is rapid and we think this lends itself to video because there is no shop to go and try on these products and to watch a live video or a short video of these products gives you an idea of what they're actually like rather than a photograph," Jones explained.
But things don't stop there.
Earlier this month, OOOOO announced a partnership with Ann Summers, a British multinational retailer, who retails curated collections of lingerie and adult toys.
We know what you're thinking: Show us the money.
Well, OOOOO generates revenue by charging what Jones calls "wafer-thin pricing." To attract large retailers, its initial strategy is to charge an "almost unnoticeable" 6% of gross merchandise value in exchange for providing them an all-mobile interactive platform that reaches hundreds of thousands of potential customers.
So What Is the OOOOO Experience?
The company is focused on attracting and retaining users, and one way is harnessing the power of gamification to garnish loyalty among followers. One feature of the app is that users are rewarded with coupons to spend within the app. Another feature is Lucky Box, which allows happy shoppers to share the app with their friends. If five friends join the community, the user receives a real box of products. Even better yet is the Share and Save feature: When a viewer shares a product with five friends, the viewer pays a reduced price on the product.
In addition to the Share and Save, OOOOO sweetens the pot with accrued in-game credits followers can then use like cash-back for future purchases, as well as instant polls where followers can vote for what's hot or not.
The Daily Deal, another new skill, allows sellers to make products available at a highly discounted price. "This is a clearance function for sellers, but it's also offering tremendous value to the consumer in that the behavior we're trying to create is that you return to the app every day to see the daily deal," Jones explained.
Real-time participation is encouraged as shoppers tune in live to try to grab a Wheel Spin - a fortune wheel pops up randomly and users can click for a discount that is available for use on purchases in the next 30 minutes. But brands can also now keep a playback of their live shows in the app so that viewers can watch them again and mine for products they may have initially missed.
And OOOOO has its eyes on markets worldwide. It recently launched a joint venture with B2W Digital. In Brazil, the largest ecommerce market in Latin America, B2W offers more than 99 million products from 96,000 sellers. OOOOO also expects to extend into Europe before year's end and then drop in the U.S. as well.
The key for its U.S. expansion, Jones said, is finding the right partners to provide the needed logistics and infrastructure support.
"We're a technology company, we don't want to get into the trucking or warehouse business," quips Jones.
A Model Proven Successful in China
"I saw the rise of this technology in Asia over the last five years and am very confident in the thematic of the space and in our team," Jones declared.
In China, where entertainment shopping is nearly a $200-billion business, Pinduoduo Inc. (PDD:NASDAQ) is the hands-down leader. It introduced the concept of the "team buy," aka discounted group pricing. It also pioneered the use of gamification as a way to entice users to open the app and engage daily.
This is a very different approach from traditional online retailers like, say, Amazon, whose platform is designed to get you to buy a pair of sunglasses, leave the site, and wait for delivery. The Chinese apps are designed to keep you in the app, coming back to play games, watch shows, refer friends, make purchases, and - best of all - have fun.
Jones see this as an opportunity "to fill the talent gap and to reskill retail employees displaced by the shifts in how people shop. It is a great example of using technology to connect people, to reward them, and to keep them coming back to the app. If we do that successfully, we prevail against the Facebooks and Amazons.
"Entertainment shopping is so popular in China that it has spawned a new (government-approved) category of employment: live host. OOOOO wants to promote that concept in the rest of the world. It has a joint venture with the Chinese company, Gathering Stars, to teach companies and individuals how to develop content, stage and create live shows, and choose products and track data.
Ready for more OOOOO? Watch CEO Sam Jones break down the business in this video.
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