TikTok's rival Kwai to roll out live shopping service in Brazil - PingWest

TikTok's rival Kwai to roll out live shopping service in Brazil

TikTok's rival Kwai to roll out live shopping service in Brazil

Rebbeca Ren

posted on 5 hours ago

In order to avoid head-on competition with TikTok, Kuaishou opted to focus on the Latin American market.

China’s second largest short video company Kuaishou is working with partners to launch the e-commerce business in Brazil, Chinese e-commerce media Ebrun reported, citing people familiar with the matter.

Kwai, the company's short video app for international markets, is now doing live shopping experiments in Brazil with partners such as Casas Bahia, the top local appliance department store, and AmazFit, Xiaomi's fitness wristband. During the pilot period, users are able to make in-app purchases while watching the live streaming.

At present, the live commerce feature is only available to selected customers in Brazil, Paul Fernandez, Sales Director of Kuaishou Americas, told the press, adding that Kwai will not collect commissions from sales for the time being.

With a population of more than 660 million, Latin America is the most critical market for Kwai. The TikTok competitor claim that it has approximately 300 million users worldwide, of which the region contributes 60 million active users.

In Brazil alone, where the platform has been operating for almost two years, Kwai held an average of 26 million monthly active users in the first quarter of 2021.

The Kwai for Business advertising platform was launched in Brazil in Oct., bringing together features for advertisers to create and insert sponsored content in the app.

Social commerce is gaining popularity in Brazil, the largest economy in Latin America, with a penetration rate of 38.7% this year. Most recently, Facily, a São Paulo-based social commerce marketplace, closed on a $250 million Series D funding round at a valuation of $850 million.

In China, both e-commerce marketplaces and short video platforms are actively fighting in the social commerce sector. In terms of gross merchandise volume (GMV), Kuaishou lags behind TikTok's sister app Douyin. 

The company lowered its GMV target for 2021 from 750 billion～800 billion yuan ($126.10 billion) to 650 billion yuan. In contrast, Douyin's e-commerce department aims to achieve 1 trillion in total sales this year.

Previously, in order to avoid head-on competition with TikTok, Kuaishou opted to focus on the Latin American market and shut down Zynn, its short video service for the North American market, in August.

But now, under TikTok's aggressive expansion in the populous region, Kuaishou's domination may become unsecured. Ampere's latest consumer survey suggests that Latin America (LatAm) had the highest percentage increase in TikTok users in the past six months; the proportion of respondents having used TikTok in the past month in Brazil rose from 25% in Q1 2021 to 38% in Q3 2021.

As of December 8, the market value of Hong Kong-listed Kuaishou has plummeted by 500% from its peak this year, owing to the tightening oversight of the internet industry and the downturn in the consumer market. According to the company's Q3 earnings, total revenue climbed by 33.4% year on year to 20.5 billion yuan ($3.23 billion), while net loss widened by 401.4% year on year to 4.82 billion yuan ($0.76 billion).

Recently, some employees from Kuaishou posted on anonymous workplace community app Maimai, saying that the company is conducting large-scale layoffs and would decrease its headcount by 30%.