How nightclubs in China used livestreaming to unlock revenues during lockdown

On January 23, when Wuhan went into a full lockdown following the spread of the coronavirus, it sent a message across the nation that other cities would have to go through something similar. But this also meant a dire impact on businesses — especially restaurants and nightclubs. 

With the fear of losing revenues overnight, a nightclub — One Third — in Beijing decided to go back to the drawing board to reimagine their revenue source at a time when large crowded spaces would become a breeding ground for the virus. Prior to the pandemic, this club could accommodate 2,000 people in its 2,500 square metres of space. 

“They realised that the business will go zero for a really long time on the same day Wuhan announced lockdown. So the management team quickly started to plan a solution,” said Debra Lou, an executive at Beijing-based consulting firm. 

After multiple brainstorming sessions, the One Third team decided to take their business of music and entertainment online. On February 8, they organized their first ‘cloud disco’ event on gaming company NetEase’s live-streaming platform which was received with great jubilation and positive reviews. Enthused by the response, the team decided to run the same event on TikTok the following day. 

Result: They earned a net amount of Rs 1 crore in revenue through an event that lasted five hours with a total of over 1.2 million viewers. 

At the same time Shanghai-based TAXX Bar also launched a cloud disco session on TikTok which saw some 71,000 participants with a total earning of $53,000 after the deduction of commissions to the platform.

This has now become a phenomenon in China with nightclubs turning to live-streaming platforms to keep their businesses alive. The initial success in February also prompted TikTok and other video apps to quickly launch ‘cloud disco’ features including a list of pubs and discos for users to choose from.

Viewers login, choose the pub they want to attend the live DJ session of, invite their friends and also send virtual gifts on the platform. 

Pubs aren’t the only ones that are riding the wave of live-streaming in China, which has almost become mainstream during the pandemic. With over 900 million internet users in the country, many of them now use live-stream for entertainment and shopping.  

Many entrepreneurs also took to live-streaming and selling products over the last few months. For instance, Luo Yonghao, founder of consumer devices firm Smartisan, had his first livestream session in April where he made sales worth $15 million. Similarly, Dong Mingzhu, the president of  Gree Electric, China’s largest household appliance maker, sold products worth RMB 300 million and RMB 700 million through livestreams on Kuaishou and JD.com, respectively. 

In contrast, India’s live-streaming segment has slowly picked up over the last few years with apps such as Bigo Live and Likee garnering users and uptick. Bigo and Likee allow users to live stream from the comfort of their homes. Livestream commerce, on the other hand, was introduced to India through the launch of BulBul, over a year ago.  

As for the norm of live streaming disco sessions in China, experts believe that it will continue to exist in the long run even as the country has lifted its lockdown. 

“It will last long even after the pandemic when pubs are opened,” said Lou. “It can become an add-on to offline dancing because in this way, people who can’t physically make it to the club are able to do so through online platforms.”