AI avatars help Chinese 7-hour livestreamer generate $7.65M in sales

Chinese livestreamer Luo Yonghao and his co-host generated $7.65 million in sales during a seven-hour session using AI avatars of themselves on Baidu’s e-commerce platform. The digital human performance outpaced Luo’s previous personal livestream, signaling a potential shift in how AI-powered virtual influencers could reshape China’s massive e-commerce livestreaming industry.

What you should know: The AI avatars were built using Baidu’s generative AI model, which learned from five years of video content to replicate Luo’s jokes and presentation style.

• Luo, who has 24.7 million followers on ByteDance’s Douyin platform, started livestreaming in April 2020 to pay off debts from his failed smartphone company Smartisan.
• His previous livestream on Baidu’s Youxuan platform lasted just over four hours and generated fewer orders for consumer electronics and food products.
• The session marked Luo’s first time using virtual human technology for product sales.

The big picture: This success represents what analysts are calling a “DeepSeek moment” for China’s livestreaming and digital human industry, referencing the AI company that rattled global markets with its cost-effective ChatGPT rival.

• Livestream shopping exploded in China after the pandemic, with Douyin surpassing traditional e-commerce giant JD.com to become the country’s second-largest e-commerce platform.
• AI avatars can dramatically reduce production costs by eliminating the need for large teams, studios, and human hosts who require breaks.

Why this matters: The technology addresses key pain points in the booming livestreaming commerce sector while potentially expanding global reach through multilingual capabilities.

• Digital humans can stream continuously without breaks, maximizing sales opportunities during peak shopping periods.
• Future implementations could enable Chinese brands to reach international audiences by livestreaming in multiple languages simultaneously.

What they’re saying: Industry experts see this as a watershed moment for virtual human technology in commerce.

• “The digital human effect has scared me … I’m a bit dazed,” Luo told his 1.7 million Weibo followers after the session.
• “We have always been skeptical about digital people livestreaming,” said Wu Jialu, head of research at Luo’s Be Friends Holding company, noting that Baidu now offers “the best digital human product currently available.”

Challenges ahead: Technical capabilities are no longer the primary barrier to widespread adoption of virtual human livestreamers.

• Compliance and platform requirements pose the biggest challenges, with digital humans needing training on advertising regulations.
• Major platforms like Douyin have implemented restrictions on virtual human technology, especially for non-interactive avatars.
• Products sold via livestreams tend to have high return rates due to impulse purchasing behavior.

Competitive landscape: Major Chinese tech companies are racing to develop digital human technology for various applications.

• Tencent has created tools for digital news anchors, while JD.com and Alibaba’s Taobao offer their own livestreaming sales portals.
• Several businesses experimented with virtual human livestreamers during the 2023 Singles Day shopping holiday.