Streaming sales trend secures Canadian beachhead

British firm eyes Vancouver for mobile e-commerce studio

Sam Jones, CEO of OOOOO Entertainment Commerce Ltd.: “We are taking a big bet that this style of commerce is coming to the West” | Chuck Chiang

A burgeoning British firm listed on the TSX Venture Exchange is betting on the next big e-commerce trend – live-stream videos selling products directly to consumers on their cellphones – in its bid to enter the Canadian market.

The company, OOOOO Entertainment Commerce Ltd. (TSX-V:OOOO), launched in the U.K. last November and has operations in that market and in Brazil. The company is also slated to enter the South African and Italian markets soon, and company CEO Sam Jones is hoping Canada isn’t too much further behind after that, and is eyeing the potential launch of a studio in Vancouver.

During a recent visit to Vancouver, Jones explained why OOOOO chose to list in B.C.

“Canadian investors really understand e-commerce, mainly because of Shopify (TSX:SHOP),” Jones said, noting Vancouver law firms Boughton Law Corp. and Sangra Moller helped bring OOOOO to list at the Venture Exchange. “The TSX-V is a great place for smaller companies to list, because it provides a pathway for us to thrive and become a much bigger company.”

Jones said the company is a western take on an already increasingly dominant retail trend happening in markets like China, where influencers and personalities market products in live-stream videos using cellphone apps.

Although still relatively unheard of in North America, selling through live-streaming video shows (on Chinese apps created by companies such as Pinduoduo Inc., Taobao Live, Beijing Kuaishou Technology Co. Ltd.) is already taking China by storm, with the total size of the market already reaching RMB90 billion ($17.8 billion) in 2019. That market was expected to hit RMB112 billion ($22.2 billion) in 2020 – before the pandemic put e-commerce sales into overdrive.

Jones cited the success of one live-stream host’s popularity with mobile-app audiences that recently generated RMB1.7 billion ($336.5 million) in transactions from one 12-hour show – a staggering number of sales driven by one person using a single cellphone camera to broadcast.

“The value of this in China is that, currently, one in nine transactions are happening through live-streaming,” Jones said. “For some brands in China, their entire marketing strategy is through that one live-stream host. He has millions of followers, and they trust him to present them with diamonds in the rough.”

That is the model, Jones said, that OOOOO would like to emulate. He sees it as the “ultimate disruptor” in modern retail – completely cutting out physical retail and its costs for brands and manufacturers to sell directly to an audience, while also maintaining a personal connection to consumers that, up to this point, only bricks-and-mortar has been able to provide.

“In China, they are probably five or six years ahead of the West, purely because mobile penetration and people’s reliance on devices are so prevalent,” Jones said. “Many people in China don’t even have a laptop; so mobile software there is so much more advanced than what we have in the West. We are taking a big bet that this style of commerce is coming to the West.

“We are trying to provide the infrastructure, technology and people to power the live-stream economy. We think you have to be an idiot to not see what is coming.”

The OOOOO app currently has 300,000 downloads in Great Britain, and the company is already running a number of shows from studios in the U.K. The company recently started construction on a 20,000-square-foot studio space.

To this point, OOOOO’s efforts have been focused on the platform side of the equation: building an app that allows audiences to make purchases directly from the videos showing them the products, hiring hosts who are able to engage the audience and creating studio spaces to give brands access to the sales platform.

“What we’ve realized dealing with many brands in the past year is that few of them understand how to do live-stream commerce,” Jones said. “It’s a very foreign concept – but in China, there are now big studios where brands can go and sell. That’s why we are now putting in place studio space, and I’d imagine we’ll be putting a studio here in Vancouver as well.”

OOOOO’s recent efforts have even caught the eyes of ByteDance Ltd.’s TikTok platform, which has entered into a partnership with Jones’ startup, he said.

Jones added that the British OOOOO app has already seen conversion rates (the ratio of audience members who make purchases versus the total number of people watching a show) as high as 20% because of the trust an audience builds with a live host.

He is hoping that, as OOOOO creates more partnerships with brands and manufacturers, and builds up larger audiences, it can take advantage of the new network of retailers and consumers to bring top products directly to market.

“Our vision is to build partnerships all over the world, and using that network to source the best products from the East,” Jones said. “If we build this network properly, it will not just be a network of companies using our tech, but also a launchpad for the best new products directly from where they are created, straight off the conveyor belt.” •