Farmers are embracing the livestream trend to sell Buddha's hand fruit during peak season in Jinhua City of Zhejiang Province.
China's livestreaming industry has transformed into a multi-billion-dollar market, but recent scandals and regulatory challenges raise questions about its sustainability and ethical practices.
What began as a niche form of entertainment in the early 2010s has ballooned into a giant industry, with over 700 million livestreaming users in 2023, making China the world's largest market.
As of the end of 2023, China boasts over 15 million professional livestreamers, equating to one in every 100 people.
China's Ministry of Human Resources has officially recognized livestreamers as a profession on July 31. It allows the livestreamers to benefit from state-sponsored vocational training subsidies and skills certification.
The dramatic rise is fueled by the widespread adoption of mobile Internet and the explosive growth of short video and livestreaming platforms.
Platforms like Douyin (the Chinese equivalent of TikTok), Taobao Live and Kuaishou now drive e-commerce, education, entertainment and social interaction.
However, the booming industry has been marred by a series of controversies known as "house collapse," where top influencers, such as "Crazy Brother Little Yang," fall from grace due to scandals.
Renowned livestreamer Li Jiaqi is known for testing up to 300 lipsticks in a single session, earning the nickname "Iron Lips."
E-commerce livestreaming became a dominant force in China's digital economy during the mid-2010s, thanks to pioneers like Viya and Li Jiaqi, known as the "Lipstick King."
Li described livestream commerce as an opportunity to "connect manufacturers with consumers directly." His rapid rise stemmed from his ability to sell thousands of lipsticks in minutes.
The COVID-19 pandemic accelerated the trend, prompting brands to shift to livestreaming amidst dropping traditional retail avenues.
The livestreaming economy generated 1.2 trillion yuan (US$168.6 billion) in 2021 and reached about 5 trillion yuan by 2023, according to Shenzhen-based ASKCI Consulting.
Yet, as the industry grew, challenges emerged for streamers who must juggle product promotions, personal image management and audience engagement.
According to iResearch, the increase in complaints of the Chinese livestreaming e-commerce market has outpaced market growth, surging by 47.1 times over the past five years, far more than in traditional e-commerce.
Dong Yuhui kicks off his outdoor livestream series, "Walking with Hui in Hubei," in March 2024.
Recent controversies have highlighted the precarious nature of influencer fame. High-profile streamers like Dong Yuhui and "Northeast Rain Sister" have faced significant backlash.
Dong, an educational content creator, made factual errors during a live session about Marie Curie, claiming she discovered uranium and invented the X-ray machine.
"One poorly phrased sentence can lead to national scrutiny," he noted, acknowledging the heightened expectations that come with fame.
Northeast Rain Sister's scandal illustrates the darker side of this industry. In October 2023, she was penalized for promoting sweet potato vermicelli that contained no sweet potato but instead was made from cassava.
Following an investigation, she was fined 1.65 million yuan for "false or misleading commercial promotion." The incident not only resulted in financial penalties but also led to a significant drop in her follower count – from 24.27 million to 22.38 million.
Other influencers, like "Crazy Brother Little Yang," the chairman and cofounder of the Three Sheep, have also faced the repercussions of their actions.
Amid multiple controversies, including false advertising of products, his brand faced fines totaling nearly 69 million yuan, with a drop in followers from 120 million to 114 million in just a month.
Chen Yinjiang, deputy secretary-general of the Consumer Protection Law Association of China Law Society, said false advertising is the most prominent issue in livestreaming.
"Unlike traditional retail or e-commerce, consumers rely entirely on the host's recommendations to make purchases," Chen told China Central Television.
"Currently, we regulate this primarily under the Anti-Unfair Competition Law, but stricter advertising regulations are needed," Chen said.
Northeast Rain Sister captivates audiences on Douyin with her entertaining livestreams.
Ma Liang, a researcher at Renmin University of China, noted that many issues in livestreaming arise from professional litigators revealing problems, rather than proactive disclosures from government agencies.
"It highlights the challenges of regulating livestreaming, which is new, fast and chaotic," Ma told CCTV.
Ma said many hosts attempt to shirk responsibility, claiming they only promote products and have no connection to the logistics or brands.
However, there must be accountability, because consumers expect hosts to stand by their recommendations. Platforms also undoubtedly share responsibility, Ma said.
China's new Consumer Rights Protection Law, effective July 1, imposes stricter regulations on deceptive practices in livestreaming.
It prohibits fabricating transaction data and manipulating user reviews, aiming to deter fraudulent activities and increase penalties for violations.
The law establishes accountability for platforms, hosts and brands, making it harder for influencers to evade responsibility after unsuccessful promotions.
In contrast to the rise of influencer-led sales in previous years, brand-led livestreaming is also emerging, leveraging stable supply chains and direct factory access to offer a distinct approach.
Crazy Brother Little Yang (right) and his brother Big Yang are taking China's livestreaming industry by storm for their energetic and engaging style.
A recent study led by Zhou Xiaoguang, deputy director of the Digital Economy Committee of the Labor Economics Association, showed a large number of livestreaming brands in industries like traditional clothing, fishing gear and furniture across rural regions in east province of Shandong and south Guangdong Province.
In Nankang of east Jiangxi Province, known for its furniture production, many carpenters returned from working in Guangdong, bringing back skills and establishing a furniture industry hub.
Their younger generation now combines traditional craftsmanship with modern technology, using livestreaming to sell their products.
In 2024, Nankang is home to over 50,000 furniture-related manufacturers, with more than 10,000 operating on Douyin, where e-commerce sales can increase by over 30 percent, according to the study.
Zhang Jiacheng, 59, went from an outcast to a successful rural livestreamer in the northwestern province of Gansu, using his earnings to change his family's life.
"Many companies have successfully built their brands through livestream e-commerce. This highlights the inherent value of the livestream e-commerce business model," said Zhao.
The rise of AI virtual hosts also presents new competition for human influencers. These digital entities can stream continuously, reducing costs and simplifying operations, though they lack the personal touch and interactivity of human hosts.
During this year's 618 shopping festival, JD.com's AI hosts appeared in over 5,000 livestreams, attracting more than 100 million viewers and generating significant engagement.
Sales representatives for AI digital livestreaming tools like BocaLive said they now support over 100 foreign digital personas, enabling quick video production in various languages.
With features like real human voice integration, they aim to enhance realism and engagement in livestream sales for the booming cross-border e-commerce sector.
An AI-generated livestreamer makes debut at World Artificial Intelligence Conference in Shanghai.
