eCommerce players are now turning to the next frontier of online shopping – live commerce, or selling products online through live video. — Reuters
NEW DELHI: India may be the largest “connected” nation with more than 800 million Internet users, but its online shopper base is just around a fourth of this number.
A key reason users stay away from online shopping is scepticism over the quality of products sold on the Internet, as well as after-sales service.
eCommerce players looking to reach out to this large, untapped customer base are now turning to the next frontier of online shopping – live commerce, or selling products online through live video. This is often done in collaboration with influencers, which gives shoppers the real-time ability to establish a rapport with brands.
India’s nascent live commerce market is expected to notch up a gross merchandise value of around US$5bil (RM21.4bil) by 2025, according to Redseer Strategy Consultants.
As this sector soars in India, the government is now looking at regulating it to curtail unfair trade practices and misleading promotions online.
Last week, the government announced guidelines for social media influencers, including virtual ones, making it mandatory for them to disclose material benefits they may have received from brands in lieu of promoting their products and services online.
These disclosures should be clear and “extremely hard to miss”, said the Department of Consumer Affairs in a guide released last Friday. For instance, they should be superimposed on an image or placed in the video itself, and not just in its textual description, to make them noticeable.
Disclosures should be displayed continuously and prominently during an entire live-streaming session as well. Influencers have been advised to review claims made on their channels and also use the products or services before endorsing them.
Rohit Kumar Singh, secretary at the Consumer Affairs Department, told reporters that the guidelines were “an obligation for them (social media influencers) to behave responsibly”.
Failure to disclose benefits can invite prosecution under India’s consumer protection legislation. This could involve a penalty of up to one million rupees (RM52,560), with subsequent offences incurring fines of up to five million rupees (RM262,383).
The government has, meanwhile, also initiated discussions with stakeholders, including experts and eCommerce entities, on the need to regulate the wider real-time online selling practices in the country.
The Bureau of Indian Standards has reached out to members of its retail, eCommerce and e-payment services sectional committee, seeking their feedback by the end of January on live commerce norms proposed by the International Organisation for Standardisation (ISO).
“The thought process is essentially whether this should be the standard that India adopts or if it should frame its own rules,” Sachin Taparia, a member of this committee, told The Straits Times.
The ISO standard draws from the regulatory framework in China, which is acknowledged as the market leader for live commerce.
The gross merchandise value of China’s social commerce industry was valued at US$363bil (RM1.55 trillion) in 2022 and could hit as much as US$2 trillion (RM8.56 trillion) by 2028.
Taparia said India should look at framing its rules to address the specific needs of Indian online shoppers, many of whom seek greater interactivity with sellers online.
According to a Jan 11 report released by LocalCircles, a community-based social media platform, seven out of 10 Indians surveyed think live commerce will enhance their eCommerce experience, with individuals wanting to use the facility for product demos and queries such as those related to terms of sale, returns and warranties.
If live commerce capability is introduced, approximately 35% of those polled would be willing to bargain with sellers.
“This behaviour comes from years and years of offline purchases that we’ve always done as a society,” Taparia pointed out.
While many Indian Internet users look at products online, they still prefer to purchase them, especially high-value ones, at a physical store. — The Straits Times/ANN
