Get All Access for $5/mo

Is Live Commerce Dying In India? ShareChat, run by Mohalla Tech Pvt. Ltd., has scaled down its live commerce division

By S Shanthi

You're reading Entrepreneur India, an international franchise of Entrepreneur Media.

Pexels

Last year, live Commerce was touted as the next big frontier for India's booming e-commerce industry. A RedSeer report said that India's live commerce would reach $4-5 billion by 2025. It also added that beauty and personal care (BPC) was expected to grow the highest by surpassing $1 billion in GMV with live commerce.

The key factor that led to the boom was Gen Z and millennial customers from across the country, especially from tier II and III cities in India, spending more time on social media than ever before. This led to short video apps gaining huge popularity, thereby leading to an uptick in live commerce.

According to Ankur Bansal, co-founder, and director, BlackSoil, "Users can watch influencers try out their favorite products which they can buy directly through the video app. Consumers in tier II and tier III cities are able to connect better with the product through live commerce as it is somewhat successful in removing the language barrier."

The key players in the space include Roposo, Josh, Taka Tak, and Chingari. Many social commerce startups such as Trell, Bulbul, 2Mall, Simsim, among others, also started offering video/live commerce on their sites where users usually record themselves with a product review, unboxing, or a haul show. Live commerce is predominantly done by resellers and marketplaces such as Amazon, Myntra also have live commerce layers.

However, live commerce seems to be slowly fading.

Live commerce not alive anymore?

ShareChat, run by Mohalla Tech Pvt. Ltd., has scaled down its live commerce division. According to news reports, the reason behind this is the company's shift in focus to profitability. "Live commerce is an important, long-term strategic bet for us and we shall continue to invest in scaling it over time. However, in the immediate term, we have calibrated the budget outlay for this area. That said, it's far from being shut down," a ShareChat spokesperson said.

The company had to let go of about 420 people out of 2,100 employees in January this year and about 5 per cent of its workforce in December 2022.

Social commerce startup Trell is also reportedly slowly shifting its focus from social commerce to an advertisements-centric model. Snapdeal has still not introduced live commerce quoting unit economics as the reason behind it. Meesho ran pilots to commercially launch its live commerce business by the end of December 2022. However, it has still not been launched.

Further, the Indian government is also now looking at regulating this sector to curtail unfair trade practices and misleading promotions online. Last month, the government announced guidelines for social media influencers, making it mandatory for them to disclose material benefits they may have received from brands in lieu of promoting their products and services online.

In the US too, live commerce seems to be slowly losing its popularity. Meta announced that effective March 16, 2023, Instagram users will no longer be able to tag products while live streaming. The move is being looked at as a reflection of the challenges live commerce is facing in the US market, where TikTok has also scaled back its live commerce services due to slowdown in sales. Earlier, Facebook also announced shifting its focus on Reels, and shutting down of live shopping feature from October 1, 2022.

Cost, shipping times, and return policies are some of the issues faced by consumers in Europe, according to a survey, along with the inability to find an exclusive offer.

What works for China does not always work for the US and Europe. In the live commerce space, it also seems to be true for India. TikTok ban, the longer duration of live stream shopping, D2C brands focusing on offline expansion are some of the reasons that are slowing down growth in this segment in India.

S Shanthi

Entrepreneur Staff

Former Senior Assistant Editor

Shanthi specializes in writing sector-specific trends, interviews and startup profiles. She has worked as a feature writer for over a decade in several print and digital media companies. 

 

Business News

Want to Start a Business? Skip the MBA, Says Bestselling Author

Entrepreneur Josh Kaufman says that the average person with an idea can go from working a job to earning $10,000 a month running their own business — no MBA required.

Leadership

Your Definition of Leadership Is Outdated — Here's How to Be a Better Leader in the Modern Workplace

In my nearly thirty years as a leader, I've focused on setting a clear vision and empowering my team to achieve our goals. We prioritize establishing shared objectives while allowing for flexibility when needed.

Starting a Business

They Showed Up to Apple With a Product They Built in Their Dorm Room. Now These Entrepreneurs Are on the Way to Changing the Way Fans Watch Sports.

How Rahat Kulshreshtha and Gaurav Mehta launched Quidich Innovation Labs, technology that is literally changing the game of sports viewership.

Business News

How Nvidia CEO Jensen Huang Transformed a Graphics Card Company Into an AI Giant: 'One of the Most Remarkable Business Pivots in History'

Here's how Nvidia pivoted its business to explore an emerging technology a decade in advance.

Thought Leaders

25 Common Characteristics of Successful Entrepreneurs

Do you have what it takes to get through hard times? Here are the traits that help home-based business owners thrive.

Leadership

Why Hearing a 'No' is the Best 'Yes' for an Entrepreneur

Throughout the years, I have discovered that rejection is an inevitable part of entrepreneurship, and learning to embrace it is crucial for achieving success.