YouTube Introduces 'Gifting' Feature for Vertical Streams, Boosting Livestream E-Commerce Competition

YouTube has launched a new "gifting" feature for its vertical livestreams, allowing users to purchase digital gifts for streamers. This feature, similar to TikTok's live gifting system, is set to enhance user engagement and provide a new revenue stream for content creators. The gifts will be converted into "rubies," which creators can redeem for a monetary value, offering a direct financial benefit for their content.

How the Gifting Feature Works

Creators who receive digital gifts through YouTube’s gifting program will earn "rubies." Each ruby is worth one cent, providing a small yet meaningful income stream for creators. The gifting feature operates similarly to TikTok’s LIVE Gifts program. TikTok users can purchase "coins" to buy virtual gifts for creators, who, in turn, earn "diamonds" based on the popularity of their livestreams. These diamonds can be redeemed for real money or virtual rewards, incentivizing creators to engage with their audiences during livestreams.

Livestream E-Commerce: A Growing Revenue Channel

Livestream e-commerce has quickly become a competitive and profitable sector within online sales. In 2022, US e-commerce sales surpassed $1 trillion, with livestream shopping accounting for about $20 billion. This number is projected to grow significantly, with livestream e-commerce expected to reach $68 billion in the United States by 2026, according to Statista. YouTube's addition of the gifting feature positions it as a direct competitor to platforms like TikTok, which have been leading the charge in livestream-driven sales.

TikTok’s Dominance in Livestream E-Commerce

TikTok's parent company, ByteDance, has established a strong foothold in the livestream e-commerce sector, particularly through its Chinese sister app, Douyin. Douyin has generated hundreds of billions in annual sales, largely driven by influencer-led livestreams. ByteDance has extended its e-commerce influence to international markets via TikTok, which has successfully integrated live selling features, including the TikTok Shop, where creators can sell their products directly to their audiences or through affiliate links.

Google’s Push to Expand YouTube’s Shopping Feature

In addition to the gifting feature, YouTube has been expanding its own shopping capabilities. YouTube Shopping allows creators to create "collections" of products that viewers can purchase during livestreams. Initially available in the US and China, the feature has recently expanded to Indonesia. Google is also working to incentivize creators to engage with YouTube’s gifting system by offering a 50% bonus on the gifts they receive, up to $1,000, for the next three months.

How YouTube’s Gifting Enhances the Livestream Experience

The gifting feature on YouTube will be visible as an overlay on livestream videos, enhancing the interactive experience between creators and viewers. YouTube aims to make these livestreams more engaging, giving both creators and their audiences a fun and interactive way to participate in the broadcast. The gifting system adds a layer of excitement and interaction that can drive more engagement, ultimately benefiting both the content creators and the platform.

The Future of Livestream E-Commerce

With the addition of the gifting feature, YouTube is positioning itself as a strong competitor in the livestream e-commerce market, a sector already dominated by platforms like TikTok. As livestream shopping continues to grow in popularity, YouTube's ability to leverage its massive user base and creator community could play a significant role in its future success in this space. By offering new features like gifting, along with expanding its shopping tools, YouTube is tapping into the growing demand for interactive, live, online shopping experiences, which are expected to see continued growth in the coming years.

Conclusion

The introduction of the gifting feature for vertical livestreams on YouTube represents a significant move by the platform to enhance user engagement and create new revenue opportunities for creators. With the growth of livestream e-commerce, YouTube’s efforts to expand its shopping and gifting features will help it stay competitive with other platforms like TikTok, which have already found success with similar tools. As livestream shopping continues to evolve, YouTube’s new offerings may play a pivotal role in shaping the future of online sales and content creation.