Livestream shopping booms as small businesses hit social media

Last year, Anthony Velez, CEO of Bagriculture, a small business selling pre-owned designer handbags, made up to $100,000 a month across his seven brick-and-mortar stores in New York City.

This year, business is much different: Velez has closed all of his physical locations, but he’s generating up to $100,000 a day.

The secret to his success, he told CNBC, has been diving into the world of livestream shopping.

“All the metrics exceed any other form of shopping I’ve seen – period,” Velez said. “We can go live on three to four platforms simultaneously.”

The trend involves a seller broadcasting live video of themselves showing and explaining products while viewers ask questions and make purchases in real time. Livestream shopping started on social media in China, and according to Coresight Research, has grown into a $512 billion market.

That market size might explain why some major platforms are rushing to grab a piece of the action here in the U.S.

“Poshmark, eBay, TikTok. [I’ve gotten] nonstop phone calls,” Velez said. “TikTok flew in from China to meet with us.”

In its most recent quarterly report, Coresight Research, which tracks the livestreaming e-commerce industry globally, projected that U.S. livestream sales would reach $32 billion by the end of 2023. However, CEO Deborah Weinswig told CNBC the firm has since revised that projection.

The original estimate was set early this year, she said, and didn’t fully take into account South Korean internet giant Naver’s acquisition of Poshmark. At the time, TikTok Shops, a way for users to buy products within the app without having to go to a separate e-commerce store, was also still getting its footing.

Now, “we believe that livestreaming sales in the U.S. could easily reach $50 billion this year,” Weinswig said. The firm also estimates livestream shopping will account for more than 5% of total e-commerce sales in the U.S. by 2026.

TikTok, Poshmark and eBay all told CNBC they’re currently testing livestream shopping.

“We’re really bullish for the growth of this new way to shop,” said eBay’s chief product officer, Eddie Garcia. “The sky’s the limit … and we’re gonna keep learning. We’re going to keep investing.”

Garcia, who oversees eBay Live, the company’s livestreaming platform, said it is currently focused on fashion and collectibles, with plans to expand from there.

“We have 134 million buyers all around the globe who are chomping at the bit and really thrilled to engage with sellers in this new way,” Garcia said.

Meanwhile Velez said he’s still fine-tuning his deals with the platforms, which involves handing over some of his earnings. Right now, he pays between 13% and 20% of each sale to cover things like payment processing and promotions.

“We give a percentage our sale in exchange for visibility, ease of use,” he said.

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