What is the correlation between?

  • Livestreams
  • Community
  • Commerce

Commerce relies on trust, which is why building a community around a brand is becoming increasingly more important. We recently discussed how livestreaming can be used as a way to build trust with consumers, and not just among the younger generations.

Going beneath the surface to determine how livestreaming can be used as a tool in the community building process to build trust requires a lot more research.

Livestreaming, Community & Commerce

The Community Business Model

The Community Business Model continues to accelerate as we kickstart 2024.

Community Business Model

From afar, building a community can seem easy, but the reality is much different. Building an authentic and self-sustaining community is one of the hardest endeavors there is.

First off, finding the right people requires some kind of shared values and purpose. Without that, there is no real “glue” to keep people connected and incentivized to build the community out further.

Secondly, all communities require some form of leadership, transparency, and governance. To keep leaders, community managers, moderators, and others invested in a community means there has to be some kind of financial incentive to do so.

Membership models work well for some type of communities on an array of possible Community Networks; others build more ad hoc, donation-based models on sites like Patreon. In the middle are brands that build communities to sell their product or service.

The whole CAC (Customer Acquisition Cost) argument supports community growth as a new channel for Customer Acquisition, but not at the expense of everything else (ie. lead generations, Ads, SEO, etc). Communities need to be nurtured, rarely do they explode in growth organically in any way that can be sustained.

For those who are exceptional community builders, it can become the main thrust of a range of possible business models, and so entire empires are being built on Slack, Discord, and a range of other community-centric platforms around the world.

Ironically, it may be Artificial Intelligence (AI) that actually becomes the major thrust for the next wave of communities.

Human Connection in an AI Era

Several new content models are being built on top of AI, with AI Article Writers for blogs/sales/ads being one example. Photography, video, and even 3D visualizations are also popular new Generative AI use cases.

The natural extension of this is to expect people to begin experimenting with, and saturating the Net 24/7 with content in search of an edge. Because why not?

The result – humans are losing trust in brands as a whole in the places where this content is being pushed.

Authentic content is being drowned out by a proliferation of unprecedented digital noise driven by bots, AI, and disguised promotions. It’s only natural that real people feel increasingly distrustful and skeptical of the content they encounter.

Advertising Week

According to Forbes, 76% of consumers are distrustful of AI content, and further to that 54% believe they can detect the difference between human and AI-generated content.

The majority remain upbeat about some of the possible use cases of AI. But consumers are wary of being duped by those in search of shortcuts to make money, a tradition as old as time.

Original ideas, accuracy of the data, and insight are fundamental elements in sales & marketing towards building trust with consumers.

Consumers are already distrustful of brands from the beginning. And the vast majority of people base their purchases on recommendations from family and friends. Fundamentally, people want to trust brands, but just don’t.

Community is a medium to bridge the ‘trust gap.’ The vast majority will base their opinions or perceptions of a brand from the recommendations and insights shared by those in their inner circles.

Thus, it stands to reason that if trust is the goal, strategies should be built in ways that augment social capital. Ironically, the AI Era provides a major catalyst for community commerce due to concerns with provenance, information accuracy, and the desire to see human creativity flourish.

What Even Is A Community?

The problem from the above is to define what a community is.

For many in the younger generations, it is defined by a Discord server, while for many in the older generations it is much more correlated to IRL (real life) connections. The middle Millennials tend to a value a hybrid between digital and physical relationships.

There are opt-in types of communities (membership), and then there are more loosely constructed (product, service) with no formal commitment.

Creators and Influencers have become an intriguing intermediary in the construction of a community due to their abilities to influence conversations in ways that produce more connection.

Livestreamers in particular have influenced about half of consumers between 18 – 49 into purchasing a product.

Younger generations are becoming increasingly likely to trust Creators and Influencers as much or more than their family and friends when it comes to recommending new products or services.

In the absence of a strong sense of community/connection IRL, many turn to a variety of online social networks to make connections that feel like community to them.

We can surmise that a community – in this day and age – is a place (whether physical or digital) that we can go and feel a sense of enhanced connection to others and a mutual benefit to belonging.

Brands can cultivate this, individuals can cultivate this, and teams can cultivate this, but in many ways it has become a lost art. This is where live streaming comes in.

Livestreaming Builds Social Capital + Connection

If part of the future is about trying to discern between fact & fiction due to the boon in AI content, then a premium will be placed on virtually everything and anything that is verifiably real.

Livestreaming is one emerging avenue to achieve this. If we think back to the original diagram at the top – Human vs. Bots on a livestream, what will happen (inevitably) when some technologies can be used to masquerade Bots as Humans?

Livestreaming - Human vs. Bot - Video & trust

What factors would we expect to recognize to differentiate the two, presuming the physical appearance and motions were identical?

In looking at research on livestreaming from China (where social commerce has already reached the mainstream market), we get some clues about how important the interaction is.

The real-time interactivity, visualization, and personalized services fostered by live streaming commerce have become the unique advantages that differentiates live streaming commerce from traditional e-commerce

Understanding the Role of Livestreaming Commerce

Where there is no live interaction between livestreamers and the audience (ie. traditional social network model), there are several ways that people can be spoofed.

Building Familiarity and Social Capital

An analysis in the West on Twitch (principally for gamers) showed that people who were part of a given community would regularly appear in the live chat in order to build familiarity, and that familiarity would become a conduit to relationships forming in that specific community.

Even where the streamer themself was dominant in terms of screentime, narration, etc, an enhanced feeling of connectivity prevailed.

The consumption of media elicits a feeling of connectedness with the media personality [29]: This connection leads the recipient to believe that they know the person better than others, and know their reasoning, characteristics, values and wishes [20].

Influencing factors for building social capital on live streaming websites

Historically, developing relationships is linked to physical proximity. The internet has obviously changed several factors in terms of how relationships are formed, but looking at an array of studies on live streaming across Asia and the West shows how the mechanisms (live video interaction + chat) can be used to build real social capital and community.

At the commerce level, the streamer is the connection between the consumer and the product. They bridge the gap. But it’s not just the performance on stream, most successful streamers have already built relationships with people off stream as well:

If the streamer wants to improve the sales performance of their live streaming room, they can consider measures to establish an effective trust relationship with consumers outside the live streaming room.

Influence of Streamer’s Social Capital on Purchase Intention in Live Streaming E-Commerce

Thus we can think in relative terms of important characteristics like empathy, foresight, and social interaction to building trust across a community. Livestreaming can augment and enhance these characteristics, thus accelerating trust and ultimately commerce in some cases.

The Home Shopping Network (HSN) shows us one example of this phenomena in the Western world back in the 80’s and 90’s, but as of yet we haven’t seen livestreaming used as a mechanism to scale-up commerce outside of Asian markets.

The ‘Creator Bridge’ to Connection

Livestream + Community

With the advent of AI, Bots, and who-knows-what-else in the future, comes a natural and introspective desire to enhance human connections wherever possible.

With so much experimentation, money, and energy being poured into Generative AI, we are probably not far away from certain personas being artificially crafted simply to gain followers and exploit trust. It may already be happening.

The need for human connection is one thing in everyday life, but it remains to be seen how amplified the need for transparency is between humans and the brands they support. Any bluff by a brand to replace human engagement with a bot on major marketing channels is likely to be met with rebuke.

There will be questions about how people will know, but the research above stated 54% can already ‘sense’ content that is artificially written. Intuition is a powerful force, and if we extrapolate this we can presume that a near majority of people will also be able to tell where Bots present themselves in humans in video form.

Some businesses and brands will embrace this, and that is a business decision like everything else; the problem will come relative to lack of transparency for those value the real human-to-human interactions.

With the social commerce market looking like it is set to explode in the West in the years ahead, and a major market opportunity awaiting, the Creators who bring expertise, professionalism, and empathy to viewers will likely be able to generate huge returns for the brands who hire them.

‘Bridging Connections’ represent a type of ‘inter-network’ connection in social-capital research. More simply, a bridge to new markets if we think about how livestreams can reach anywhere with an internet connection.

Right now, we still mostly see short-form videos posted on TikTok etc. driving a majority of the social commerce, especially since TikTok Shop launched in the US market. But with an increased focus on community and authenticity, more brands will likely look towards livestreamers to be the bridge between them and their customers.

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