Live streaming during the big sale season is a big aspect for China’s e-commerce industry. Instead of influencers, e-commerce platforms are now turning to AI-generated videos hosting streams.
China’s massive live-streaming e-commerce sector is known to peddle everything from lipstick and food to smartphones, cars and even rocket launch services. A major retail event like Singles Day can easily generate tens of billions of dollars in sales overnight.
While major Chinese cities such as Shenzhen and Hangzhou are racing to establish global live-streaming e-commerce hubs, many Chinese tech companies are now pushing generative artificial intelligence (AI) technology to develop virtual live-streaming hosts capable of 24-hour sessions, further increasing interest in this area.
Generative AI refers to algorithms such as those powering ChatGPT and similar services, which can be used to create new content such as voice, code, images, text, simulations, and videos.
This application to generative AI highlights how this technology is wreaking havoc on certain traditional occupations in China as well as the broader job market.
The emergence of new generative AI-powered virtual hosts could significantly disrupt the lives of more than 400,000 human livestreamers across platforms such as Alibaba Group Holding’s Taobao Live, Tencent Holdings’ WeChat and Douyin, and ByteDance’s Kuaishou Technology. Alibaba, which owns the South China Morning Post, is also part of the picture.
According to Hugo Huang, founder of Sansongshuzi, a Guangzhou-based virtual hosting provider, the cost of hiring virtual hosts for online marketing campaigns is much lower than hiring human livestreamers. His company says he offers virtual hosts who can appear in short videos and live-streaming sessions for as little as RMB 500 (US$70) a month.
In contrast, the typical cost of hiring a human host and renting a physical studio reaches around RMB 50,000 per month, making using a virtual host a much more cost-effective option for both small vendors and big brands. This significant cost differential could accelerate the adoption of AI-powered virtual hosts, potentially banishing many human livestreamers from their current jobs.
Several major brands in China’s live-streaming e-commerce space have shown keen interest in exploring the potential of generative AI-driven virtual hosts. According to Gao Zilong, COO of WH Zones, a Beijing-based startup that specializes in virtual influencers, major consumer brands, including local consumer electronics giants and international cosmetics conglomerates, are working with his company to launch online campaigns using virtual livestreamers. These virtual hosts are designed to look like certain celebrities.
Gao believes that combining the technology of virtual hosting with the influence of popular human celebrities within local fan bases can greatly improve online sales for brands.
Two types of virtual hosts are currently being developed: two-dimensional (2D) simulation technology and three-dimensional (3D) simulation technology. 2D hosts are more cost effective, while 3D hosts offer more creative possibilities.
However, Gao points out that in order for 3D virtual hosts to match the capabilities of human livestreamers, the total cost of using them will be even higher than hiring live hosts.
Despite the hype around virtual hosts in China’s live-streaming e-commerce market, this AI application is still in its early stages. Zhang Yi, CEO of research firm iiMedia, commented that at the moment this application is limited and there is ongoing debate as to whether this business model can be widely adopted.
Aside from the cost advantage, Zhang believes online youth are more likely to be attracted to digital personas and more willing to embrace this new technology. The attraction of virtual hosting to the younger generation may contribute to the further development and adoption of this AI-driven approach in the live-streaming e-commerce market.
At a recent corporate event hosted by Baidu in Hangzhou, China, Baidu, a renowned online search giant and advocate of artificial intelligence (AI), showcased a new workflow based on large-scale language models, which is also the technology behind the chatbot Ernie Bot. This workflow allows users to enter specific keywords related to products, sales goals, content length, and in return generates a script that a human host can use to showcase the product during a live streaming session. Additionally, AI-powered solutions offer other content that hosts can use to effectively engage with their online audience.
Baidu showcased a successful vendor success story that used the same AI solution to sell Shanghai Disneyland tickets, achieving a staggering 540,000 RMB in just one month.
AI offers significant advantages in generating content for live hosts and creating virtual livestreamers, but some platforms still prefer human performance. Sansongshuzi’s Huang said platforms like Douyin and Kuaishou continue to favor human livestreamers over virtual livestreamers. He emphasized that while virtual livestreamers may not get as much attention on these platforms, e-commerce platforms like Alibaba-owned Taobao do not limit the visibility of virtual livestreamers on their platforms. The race between AI-powered virtual hosts and human livestreamers is still going on, and it is clear that they coexist on different platforms in the livestreaming e-commerce market.
