(We originally posted this on November 24, 2020. You can read more of our original ideas in our archive.)
Problem: Commerce online is an individual experience.
Solution: A modernized QVC platform, reinvented for the mobile or gen Z / millennial market.
For those who are skepitcal, I’ll point to the extremely successful example of Taobao in China; one of the leaders of livestream shopping. Livestream shopping has taken China by storm. As described by WeAreSocial, “First practised by e-commerce platforms back in 2016, this year it proved an invaluable bridge across the gap between goods suppliers and consumers during the peak of lockdown caused by COVID-19. Over the country’s latest annual shopping festival on July 1, livestream shopping generated US$449.5m in sales on one day, alone.”
Journalists at Forbes and TechNode argue that this live-streaming could potentially be the future of commerce, especially as individuals continue to work-from-home. As Forbes goes on to describe, “Alibaba’s Singles’ Day, the world’s largest online shopping event held in China, was a blowout this year as it reported a record $74 billion in sales over 11 days.” In large part, these revenues were driven by social commerce and social shopping.
So what’s going on here?
E-commerce live-streaming started in 2016 and has exploded since then. TaoBao (an Alibaba company) has mastered engagement in social shopping and as a result is seeing huge benefits in customers wanting to purchase new products through an extremely fun industry and market. Moreover, big brands are betting that engagement in shopping is actually better than simply purchasing in isolation. If you truly want to understand the market, I encourage you to watch this video here because it deeps dive into the human element of live streaming for e-commerce.
“QVC’s revenue is greater than Shopify, Etsy, Pinterest, Zoom, and Twitter—combined.”
The opportunity is huge in the US: as described by Chris Cantino who explains both the Market Size and even mocked up an image of what a product like this could look like (see above). Just last year, for instance, QVC made nearly $11 billion in revenue last year and is currently has a market capitalization of close to $50 billion. This “shopping on television” option is the closest thing that exists in the United States to social shopping; however, even in the face of this, QVC has not developed a compelling, millennial-targeted mobile app. This business, however, would focus on that.
One example of a company already running in this space with quite a bit of traction is Popshop Live. Just about 2 weeks ago, Benchmark Capital invested in Popshop at a valuation of almost $100 million. As reported by The Information,
Silicon Valley’s top venture capital funds have faced off again for an equity stake in a nascent social media app. This time it’s Popshop Live, a livestreaming app that enables individuals and businesses to sell products such as comic books and DIY crafts directly to customers.
The Los Angeles–based startup has raised Series A funding at a pre-money valuation of approximately $100 million. Benchmark beat out rivals including Andreessen Horowitz and Lightspeed Venture Partners to lead the round, according to people familiar with the talks. To help secure the deal, Matt Cohler, a general partner at Benchmark who stepped back from investing in 2018, is joining the startup’s board of directors.
Many have seen the relation between Popshop and the potential future of shopping. With one customer even saying, happily, “This app is so fun, it’s like QVC shopping meets Snapchat! I love meeting the sellers and commenting with questions.” This business (a competitor) would speed up the product iteration lifecycle, provide loads of data about the future of product selling, and more.
Monetization: A processing fee per sale on the platform.
Contributed by: Michael Bervell (Billion Dollar Startup Ideas)