It doesn’t sound like a big deal… but it is.

$135 billion dollars (to be exact). That’s how much revenue is expected to be generated in e-commerce sales via livestreams in China this year.

Last year live-streaming was 1 of the top 3 most used tactics used by marketers in China. With Covid19 audiences, competition, and uses have increased.

Alibaba owned ‘Taobao Live’ increased 7X in first-time customers. Pinduoduo’s live-streaming views grew 5x in March (month over month).

In February users averaged 120 minutes watching livestreams on Douyin (compared to 89 minutes with other content). On Bilibili a similar trend emerged. On average, users watched 190 minutes of livestream content and 105 minutes of other content.

The number of industries flocking to livestreaming to drive sales has been mind-bending.

JD.com partnered with DJ’s to host weekly livestream performances. Alcohol brands sponsored the events and viewers could purchase with a single click. One whiskey advertiser increased sales 70 percent. Beer sales of another partner increased 40 percent.

On Douyin (ie TikTok in China) one livestream hosted by Luo Yonghao an entrepreneur and digital personality, drove $15.5 million in sales and 48 million viewers all in a 3 hour time span.

A Taobao live-streamer, Austin Li, generated 16 million viewers to watch (and purchase) his lipstick.  

Even the farming industry has turned to live-streaming.

With traditional supply lines decimated due to Covid19, live-streaming has become a lifeline. Taobao now has over fifty thousands farmers live-streaming. They’re selling their crops direct to consumers.

“Growers who had once sold 90% of their products offline have now flipped to selling 90% online. Live-streaming has not only helped the industry weather the crisis—it’s forged an entirely new way of business that is likely to continue long after the pandemic is over.”

MIT Technology

China has mastered ‘shoppertainment’.

It seems as though each week there is a new streaming record being broken, new use, or new sales record. With dollars and audiences so massive, it’s a foregone conclusion we’ll see attempts by brands and platforms to replicate the habits and features here in the US.

First reported by The Information, the YouTube version of TikTok has been dubbed ‘Shorts’. The TikTok competitor is rumored to live within the existing YouTube app and take advantage of YouTube’s music licensing deals.

This doesn’t come as a total shock. YouTube has been quietly incorporating TikTok style features for some time now. Over the last month or so YouTube’s app has changed features that mirror TikTok in three big ways:

1) Emphasizing categories vs search
2) Curating content experiences
3) Providing content prompts

CATEGORIES VS SEARCH

Last week I wrote about how YouTube shifted its emphasis from search to more curated experiences (like TikTok) and was bracketing content categories in a manner very similar to hashtag challenges.

Historically, YouTube placed an emphasis on search (it being the second largest search engine). Recently the search feature was changed to ‘explore’. Now when you click on ‘explore’, there are categories of content featured that site above recommended and trending videos. Previously the app had trending and recommended content. This mimics TikTok’s has ‘discover’ feature.

At the top of TikTok’s discover page is curated content categories, hashtag challenges, and list of trending hashtags. 

YouTube is evolving from specific video recommendations to an emphasis on broader categories. 

CURATED CONTENT

When you click on a content category there’s a header and  curated list of videos to watch. This is layout is similar TikTok.

On TikTok if you click through to one of the content categories or hashtag challenge there’s a banner across the top, description of the content and then a curated list of TikTok’s to watch.

PROMPTING CONTENT CREATION

YouTube seems to be taking cues from TikTok’s hashtag challenges. TikTok’s hashtag challenges act as prompts for users to create content. Creators often jump on the challenges in hopes of being featured high up on the challenge pages and getting exposure.

YouTube has begun experimenting with its own hashtag challenges.
Due to Coronavirus millions have been forced to stay home. YouTube helped get the word out by launching the Stay Home #withme challenge. The Stay home #withme challenge invited creators to make videos around activities anyone could do from home. 

YouTube consolidated all #withme videos under the hashtag (much in the same way TikTok does). YouTube doesn’t typically create or promote specific content asks from its community. In making this change YouTube mirrored hashtag challenges.

These are big shifts for YouTube.

Search has been such a big part of the site, that playing a larger role in promoting ’discovery’ seems as though the platform is looking to modify behavior in a significant way. Additionally, YouTube has historically been passive in content creation. With the launch of #withme YouTube clearly provided a prompt for the broader community.

These changes, which are influenced by TikTok, are likely providing data to YouTube to inform their ‘Shorts’ launch.

The tenth, US based Vidcon, has come to its conclusion.

The conference has grown dramatically, from its humble beginnings – a few hundred people in LA – to tens of thousands of attendees filling the Anaheim Convention Center.

I’ve been to every Vidcon that’s been hosted in the US and its crazy to look back and see how much it has grown.  Brands now flock to Vidcon, and whole industries have been built upon the influencer economy.

This year I identified five overarching trends that really dominated Vidcon.

#1 CHINA, CHINA, CHINA

It’s been just under a year since China based ByteDance rebranded Musical.ly as TikTok, and in that short period of time they turned the platform into the most buzzed about social network.

While most big YouTubers were hidden away from throngs of fans at Vidcon, only coming out for meetups and panels, TikTokers were everywhere doing collaborations, and generally making their presence felt. It didn’t hurt that the platform also hosted the biggest bash of the event with a live performances from 2Chainz

TikTok wasn’t the only Chinese based platform with a presence at Vidcon. Haohao Xu, the Sr Director of Tencent hosted a fireside chat where he discussed Tencent’s push beyond China.

Seunghae Ahn, Product General Manager at Baidu also did a talk and highlighted Baidu’s video capabilities, and robust influencer ecosystem. The key takeaway being, that Chinese creators are expanding beyond their native platforms into YouTube (and beyond) and that there’s a massive MCN industry developing to help non-Chinese based creators develop audiences on Baidu properties.

#2 DIVERSIFYING REVENUE STREAMS

One of the hottest topics at Vidcon this year was how influencers can monetize their audiences beyond relying solely upon ad dollars.

For context, over the last few years the major platforms (YouTube, Facebook, etc) have applied more stringent rules for what content can and cannot be monetized, and CPM’s for most creators have declined. As a result, a whole ecosystem has emerged to help creators diversify revenue streams so that they’re not solely reliant upon advertising dollars.

At Vidcon, YouTube’s Chief Product Officer, Neal Mohan announced the launch of ‘Super Stickers’ which fans can purchase and deliver to their favorite creators (at a price), of which the creators get a significant percentage. They also announced additional tiers to their Channel Membership program, which acts similarly to Twitch’s subscription features and offeres varying degrees of exclusive content in exchange.

Just ahead of Vidcon, Facebook hosted a number of creators up in Malibu and announced a number of similar updates.

Facebook announced that Stars, a tipping feature currently being used exclusively in gaming streams, is going to be rolled out beyond gamers as part of an expanded beta to a small group of video creators. Additionally, Facebook like YouTube is going to begin testing, paid subscription features.

#3 WHERE WERE THE MCN’S?

One of the most noteworthy trends was a lack of (most) MCN presence.

First and foremost it is worth noting the exceptions – Collab, AwesomenessTV and Studio71 all had their presence felt. Studio71 hosted their annual bash, always the best party at Vidcon. Collab had an exclusive lounge and parties as well, and AwesomenessTV was plastered across Vidcon with advertising and booths.

However, in years past MCN’s dominated the conversation at Vidcon. They were a hot topic at most panels and keynotes, and for years were amongst the biggest sponsors. A lot has changed – Maker studios is non-existent, having been purchased and then shuttered by Disney, both Machinima and Stylehaul shut down. Countless other MCN’s have quietly shut down or are puttering along, but without the fanfare they once had.

The only reference to MCN’s that I noticed at any of the panels and talks I attended was in Baidu’s presentation in reference to the development of a Chinese MCN ecosystem.

There were rumblings of MCN’s having side meetings with YouTube about the fact that they feel as though they no longer feel supported by the platform.  Beyond that MCN’s were hardly mentioned and there were no panels or keynotes where they were the primary topic of conversation.

#4 VOLUME OF PLATFORMS

At the first Vidcon, 10 years ago, YouTube was the only viable social video platform. There was no Instagram, Facebook hadn’t launched video, and Vimeo, Dailymotion, etc were already left in the dust by YouTube’s sheer scale.

Fast-forward 10 years and there are over a half dozen major players in the social video space each vying for the attention of creators. Linkedin now has video, there’s YouNow and Twitch pushing to dominate livestreaming, Snap, Instagram, and TikTok are battling each other over short form content, and IGTV and Facebook Watch are making real attempts at chipping away at YouTube’s scale. Even Pinterest has a video offering it was touting to advertisers.

#5 DAMAGE CONTROL

Social media platforms have had a rough couple of years; at Vidcon it was clear YouTube wanted to take the opportunity to spruce up their image.

YouTube emphasized all the good they’re doing. During their keynote Neal Mohan, Chief Product Officer at YouTube went out of his way to highlight how diverse the platform is, and how they’re going to invest in education.  Hardly a word was mentioned about the recent controversies they’ve been embroiled in regarding censorship, de-platforming, radicalization, and demonetization. Other than a brief reference to updates to their terms of service coming out within the next six months you’d think everything was humming along smoothly.

I admire all the good that YouTube has done but the YouTube presentation felt like an attempt to white wash there image in front of an industry audience instead of addressing the real issues they’ve been facing over the last several years.

Regardless, as in years past Vidcon was a great way to get insight into what’s changing within the industry as well as connect with creators and other companies within the ecosystem. I’m also still shocked at how few brands and agencies invest in having a presence. Ten years in, I’d argue that Vidcon is the best, and most undervalued way to tap into the biggest influencers on the planet.

In November of 2018, Facebook quietly released Lasso, which a spokesperson described as “a new standalone app for short-form, entertaining videos — from comedy to beauty to fitness and more.”

The app is strikingly similar to the wildly popular app, TikTok, which is owned by the Chinese tech company, ByteDance. TikTok has grown incredibly quickly, with hundreds of millions of active users worldwide, and is increasingly perceived as a threat to Facebook amongst the youth market.

What is Facebook Lasso?

Facebook Lasso is a social network where users create 15 second videos. Users can can sync their videos to music and audio tracks, all while layering on various visual effects.

Lasso is primarily focused around a full screen ‘Recommended’ video feed serving you one video at a time where a user can swipe up or down to see algorithmically recommended videos. Viewers can like, comment, or click through to a users profile and choose to follow their favorite creators.

Similar to TikTok, Lasso has a browse page largely organized around popular hashtags (reflecting the popular challenges/trends on the platform). Lasso deviates a bit from TikTok in that at the top of the browse page Lasso features ‘Today’s Top Creators’ whereas TikTok uses similar real estate to highlight a variety of initiatives from popular challenges, to new creators on the platform, as well as brand activations.

Here’s the official description of Lasso from their IOS app store page:

Lasso makes it easy for anyone to create and share short videos with fun effects. Follow creators, discover popular video trends and join in by putting your own spin on them. Once you’ve found a type of video that’s trending, whether it’s #comedy or #fail, you can use the in-app camera to put your own spin on it with special effects, music and editing tools. Add hashtags to your video to share it with the world! You can also add your videos directly to your Facebook story.

COOL CAMERA TOOLS AND EFFECTS

Get high-quality video editing tools, effects, text on video tools, music and more from the in-app camera.

A MASSIVE MUSIC LIBRARY

Lasso’s music library is one of the biggest. From pop hits to vintage classics, you’ll find whatever song you need to take your videos to the next level.

THE LATEST HASHTAGS AND CHALLENGES

Lasso lets you know which hashtags are trending and which ones might be soon. Be one of the first people to discover a new trend or one of the first to create a video for it!

SHARE DIRECTLY TO YOUR STORY

Lasso seamlessly connects to Facebook so you can post your videos to your story with a single tap. Whether you want your video to show on all your social profiles or just in one place, you have control over what you share and where it goes.

According to Techcrunch, Lasso was developed by Facebook’s Watch team under leadership from Facebook’s lead product designer, Brady Voss.

Why did Facebook launch Lasso?

Undoubtedly Facebook sees TikTok as a threat.

Tik Tok’s global user base is massive and growing quickly. TikTok platform has a reported 800 million total installs to date (not including Android uses in China) and is frequently ranked as the No. 1 free app in Apple’s App Store.

According to Variety, “the U.S. Global downloads of TikTok for the month of October 2018 exceeded 68 million, a year-over-year increase of 395%; that included about 6 million in the U.S.”

Beyond the sheer volume of users, the thing TikTok has which Facebook does not, is a younger/teen audience, an estimate 66% of TikTok users are younger than 30-years-old.

In recent years younger consumers have fled Facebook (or never signed up to begin with). According to a 2018 PEW study Facebook isn’t even in the top three most used social networks amongst teens.  Although Facebook does own Instagram, which still has a firm hold on the teen usage, it is worth noting that since 2015 Facebook went from having the #1 & #2 most popular social networks amongst teens to #2 & #4.

According to a Piper Jaffray survey just 5 percent of U.S. teens cite Facebook as their favorite social platform and the percentage who use it monthly has dropped from 60 percent to 36 percent since Spring 2016.

With so many surveys showing Facebook is losing its grip on younger consumers its clear why they’d see an app gaining traction amongst hundreds of millions of teens as a threat.

HOW IS FACEBOOK LASSO PERFORMING SO FAR?

By all accounts Lasso is not attracting much of an audience. According to CNBC, as of February of 2019, Lasso had been downloaded by an 70,000 U.S. users – in the same period of time TikTok had been downloaded by 40 million U.S. users.

In exploring the Lasso community none of the creators on the platform have significant followings. I never found anyone with more than 3.5K followers. In fact, the most popular creator I could find was James Henry, with 3.1K followers on Lasso vs his 1.6 million followers on TikTok.

Meanwhile, there are dozens, if not hundreds of creators on TikTok with millions of followers. TikTok has even gotten so popular it has begun to attract mainstream celebrities such as Arnold Schwarzenegger, DJ Khaled, and Ryan Seacrest (to name a few).

In exploring the Lasso community there doesn’t appear to be much happening. I noticed that the level of engagement it takes to be designated the ‘Top Creator Of The Day’ is very low. In the days I explored the app the content creators featured in the ‘Top Creators Of The Day’ section had fewer than 5 comments.

Currently, Lasso isn’t even amongst the top 200 most downloaded free IOS apps, while TikTok has been consistently been in the top 20 (occasionally hitting the #1 spot). To top it off Lasso has 4.3 stars in the IOS Store and 3.5 rating in the Google App store. Meanwhile TikTok has a significanly higher rating of 4.8 stars in the IOS App store and 4.4 stars in the Google App store.

Lasso’s social media following is tiny. As of April 2019, Lasso has 141 followers on Twitter, the Lasso Facebook page only has 1,928 followers, and their Instagram has just under 7.5K followers. In all Lasso’s social media footprint is under 10,000 fans and followers while TikTok has over 9 Million followers on their US focused Facebook page alone.

HOW FACEBOOK IS PROMOTING LASSO

Ultimately, it just doesn’t appear as though Facebook is doing much to promote their new app. Outside of partnering with a handful of creators from other platforms to appear in a handful of Facebook ads, the only other promotion that I could find was that they sponsored a party at Playlist Live, a popular influencer convention.

When visiting Lasso’s Facebook page, I took a look at the ads that they’re running to drive installs. All of the 24 different ad types Lasso is running targeting US & Mexico audiences feature a handful of ‘Star’ creators from the platform.

Lasso appears to give these creators they’ve partnered with a ‘star’ designation, the Lasso equivalent of a verified account. When looking at the same featured creators on other platforms they tend to have hundreds of thousands to several million fans and followers across TikTok, YouTube, and Instagram.

Meanwhile has been incredibly aggressive in building a community and actively acquiring users, and courting influencers. Reports point to hundreds of millions of dollars in ad dollars to promote TikTok. Apparently, in Q1 of 2019 3 percent of all ads seen by users of Facebook’s Android app were promoting TikTok.

HOW DOES LASSO FIT INTO FACEBOOK’S VIDEO STRATEGY?

Video is going to play an important role in unlocking ad dollars for Facebook, and it undoubtedly wants a significant piece of the estimated $16 billion that eMarketer estimates will be spent on mobile video ads in 2019.

However, in spite of Facebook’s efforts to chip away at YouTube’s market share, they’ve had mixed results. Facebook luanched Facebook Watch, which has YouTube style pages and functionality in 2017. In 2018, Facebook launched IGTV as a standalone video app meant to appeal to the more vlog/influencer crowd. Yet, none of these initiatives have come close to becoming a true ‘YouTube killer’.

IGTV is largely considered a flop. Of the top 10 Instagrammers, only half have ever even posted to the IGTV platform. Furthermore, Facebook recently began pushing IGTV videos into the instagram feed, a move many point to as evidence of a need to drive audience to a largely dormant platform.

Facebook is seeing slightly better luck with Watch than they are with IGTV but still coming up short. According to a Morgan Stanley study 75% of Facebook Watch users are viewing short-form videos (under 20 minutes) weekly, and 78% of respondents said they have used YouTube in the last 12 months, compared with 43% for Facebook Watch. As a result, YouTube “remains the online video leader.”

WHAT NEXT FOR FACEBOOK LASSO?

We’ve seen Facebook in situations similar to the one it is in today with TikTok – where an upstart social network is garnering the youth audience.

With the advent of Snapchat, Facebook responded by deploying at least four Snapchat copycats — Poke, Slingshot, Lifestage and Flash — before simply taking the Stories feature that was so popular within Snapchat and copying it to Instagram. Shortly after taking the stories feature and applying it to Instagram, Snapchat usage plummeted.

Assuming TikTok continues to grow, its likely we’ll see more investment in Lasso or the development of additional TikTok/Lasso – like apps from Facebook. Ultimately, if that doesn’t work its likely we’ll see TikTok features copied and integrated throughout the Facebook ecosystem.

However, with TikTok, Facebook has a far more formidable competitor than they had with Snapchat. TikTok is part of ByteDance a Chinese based firm which has a $75 billion valuation, and recently raised $3 Billion with Softbank.

Although, Lasso doesn’t appear to be successful, I expect it to be one of many attempts by Facebook to grow a younger user base and fend off TikTok’s stranglehold on teens. With billions at its disposal, and a track record of buying or copying (in order to smother) emerging competitors, it is unlikely this is the only TikTok defense Facebook has in the works.