Is Kuaishou the Next Big Thing for Luxury Livestreaming in China?

Key Takeaways:

  • With its users largely concentrated in lower-tier cities and rural areas, short video and livestreaming platform Kuaishou has been largely overlooked by major luxury brands.
  • With nearly 380 million daily active users and billions in revenue, the platform is increasingly difficult to ignore.
  • By livestreaming its recent Spring/Summer 2022 menswear collection on Kuaishou alongside Weibo and WeChat, Louis Vuitton gave Kuaishou significant luxury credibility, potentially a harbinger of what’s to come in the months ahead.

Over the past few years, China’s video platforms have become powerful drivers of luxury, fashion, and beauty purchases, piquing the interest of global brands hoping to tap China’s younger millennial and Gen Z consumers on the platforms that matter most to them. And while Douyin (TikTok’s Chinese counterpart) gets most of the attention, the past 18 months have seen more high-end brands experimenting with Bilibili, looking to capture the modest but growing spending power of its more than 61 million daily active users (DAUs), more than 80 percent of whom are under the age of 25. 

Louis Vuitton, Gucci, and Dior are among the digitally adventurous luxury brands that have launched official accounts or ad campaigns on Bilibili. But Kuaishou, despite boasting nearly 380 million daily active users, has yet to attract much attention from global luxury brands. 

This most likely comes down to a misreading of Kuaishou’s user demographics. The platform is a money-making machine, hitting a gross merchandise value of RMB 118.6 billion ($18.3 billion) from e-commerce transactions during the first quarter of 2021, up nearly 220 percent from the same period last year. But its user base is largely concentrated in lower-tier cities and rural areas, in contrast to Douyin and Bilibili, which are geared towards the users in first- and second-tier cities, a more traditionally desirable audience for luxury brands. 

But consumers in lower-tier cities are, according to McKinsey & Company, “flush with disposable cash” owing to lower costs of living, with ample free time to follow trends and make online purchases. During the recent 618 shopping festival, Alibaba reported that Tmall Luxury Pavilion sales to consumers in third- and fourth-tier cities were up by 80 percent compared to 2020, with some far-flung locations, such as Qitaihe in northern Heilongjiang Province and Inner Mongolia’s Xilingol League, seeing luxury sales growth of over 150 percent. As a result, luxury’s disinterest in platforms that cater to these shoppers no longer makes much sense. 

With or without the active participation of luxury brands, the platform has made efforts to upgrade its image in terms of e-commerce. Last year, Kuaishou partnered with luxury e-commerce retailer Secoo to launch a 24-hour livestreaming channel around the time of the June 618 shopping festival. In just five hours, Secoo sold nearly $15 million worth of products from the likes of Louis Vuitton and Gucci, though that event relied heavily on discounts and subsidies to boost sales. More recently, Kuaishou has collaborated with Secoo to establish a 75,000-square-foot luxury “livestreaming base” that will allow as many as 300 hosts to broadcast simultaneously, and with JD.com to promote e-commerce livestreaming for beauty brands. 

Meanwhile, some leading influencers on Kuaishou, such as Luo Jia, the self-proclaimed “luxury livestreaming king,” have developed strong and lucrative followings, with Luo hosting sessions for Emporio Armani and Versace. 

More brands may be poised to test the waters on Kuaishou via content. On June 24, Louis Vuitton (which took its first stab at e-commerce livestreaming last spring on Xiaohongshu) broadcast its Paris fashion show for its Spring/Summer menswear 2022 collection on Kuaishou through a collaboration with Nylon magazine, marking the first ever livestream of a luxury brand runway show on the platform. Louis Vuitton also livestreamed the show on more established platforms for luxury brands such as Weibo and WeChat, but the results from Kuaishou are likely to attract attention from rival brands and luxury groups. Of the 131 million total views across platforms, Kuaishou reportedly contributed a significant chunk: 39 million, compared to Weibo’s 44 million. 

In the near-term at least, Kuaishou is likely to remain more a place to buy affordable beauty products and food, or offer virtual gifts to influencers, than a major luxury hotspot. But with brands far less concerned about working with a wide variety of digital channels in China than they were less than a decade ago (when many grappled with the idea of joining Weibo or WeChat at the risk of losing brand equity), it is very likely we’ll see a greater willingness from brands to incorporate Kuaishou into to their overall marketing strategies. At this point, any exposure — especially to a young and highly engaged audience of hundreds of millions of daily users — can’t hurt.

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Content Commerce, Market Analysis