Naver 'Labang' Leads to Surprise Monthly Sales of 200 Million Won

Small and Medium Business Sales Volume and Revenue Increase by About 50%
Also Leads to Increase in Regular Customers
Live Commerce Market Expected to Reach 10 Trillion Won in 2023

Live commerce, or so-called ‘Labang,’ which sells products through live broadcasts in the e-commerce market, has established itself as a major trend. It has been shown to significantly contribute to increasing sales for small and medium-sized enterprises (SMEs). As the market size of Labang is expected to grow to 10 trillion KRW in 2023, competition among IT companies is intensifying.

Naver’s ‘Labang’ Boosts Sales

On the 28th, Naver released the ‘D-Commerce Report 2021,’ which includes research by Professor Kim Ji-young of Sungkyunkwan University on Naver Shopping Live. According to the report, Naver Smart Stores that conducted Shopping Live saw average sales volume and revenue increase by 49% and 48%, respectively, compared to stores that did not use Shopping Live. Stores that did not use Shopping Live experienced only 7% and 16% increases in sales volume and revenue, respectively.

The use of Shopping Live by sellers also led to an increase in loyal customers. Stores that conducted Shopping Live showed increases of 128% and 47% in store bookmarks/news subscriptions and visitor numbers, respectively. The effect was particularly notable among SMEs in various sectors such as fashion, daily necessities, and food. Smart Stores like ‘Monotime’ (Chungbuk Geumsan Fashion Road Shop), ‘Gukdae Mask’ (daily necessities), and ‘Jayeon Edeoh’ (directly shipped from production sites) implemented a strategy of consistently operating Shopping Live more than 7 to 8 times per week, achieving monthly sales exceeding 200 million KRW. According to Naver, 31% of all Shopping Live sellers conduct live broadcasts once a week. The number of sellers has surged by 2622% compared to the early days of the service. Among them, over 50% are active sellers who conduct live broadcasts twice or more per week, and this proportion is gradually increasing.

Shopping Live is analyzed to have led to increased sales by combining the advantages of offline and online, commerce and social media. Naver Shopping Live allows sellers to introduce products directly through live broadcasts and real-time chat, and anyone can easily conduct live broadcasts with just a smartphone without the need for a separate studio or large equipment. Providing ‘tools’ that connect loyal customers, such as store bookmarks and news subscriptions, also increased the purchase conversion rate.

A Naver representative explained, "In the case of Shopping Live content, it technically connects loyal customers, so people with high interest find it and the purchase conversion rate is high," adding, "Even after the live broadcast ends, it is provided as video on demand (VOD) through Naver’s video editing technology, increasing post-purchase rates." With this technological combination, Naver Shopping Live’s cumulative views have surpassed 700 million, and cumulative transaction volume has exceeded 500 billion KRW.

Intense ‘Live’ Competition Among IT Companies

According to Kyobo Securities, the domestic live commerce market size is expected to grow from 400 billion KRW last year to 10 trillion KRW in 2023. In response to this growth, IT companies are actively expanding their businesses. Kakao, for example, merged its subsidiary Kakao Commerce back into the company and acquired the live commerce platform Grip Company for 180 billion KRW. Kakao also has a grand plan to enter the global market for live commerce in cooperation with Grip. Kakao Shopping Live has surpassed 150 million cumulative views, with an average of 200,000 views per broadcast, marking a 56% growth compared to the previous year.

Coupang is also strengthening its related business by recruiting live commerce sellers. Since piloting Coupang Live earlier this year, Coupang has been actively guiding sellers to live commerce channels and recruiting sellers.

An industry insider said, "Middle-aged and older consumers who are accustomed to traditional home shopping are newly entering the market, and the MZ generation (Millennials + Generation Z) tends to shop through videos," adding, "As live commerce continues to grow, competition among companies to secure market share will become fiercer."

This content was produced with the assistance of AI translation services.