E-commerce is a way of life for retail in China, but until recently it had barely touched the agricultural industry, one of the country's least innovative sectors. But this changed the past year with the pandemic accelerating farmers' move online.
Farmers have taken to live streaming on online platforms, typically the domain of urban influencers showcasing luxury and consumer goods for a digital audience. Live-streamed shows provide links to featured products, making it easy for viewers to click and purchase.
The technology is enabling China's rural sector to rapidly create a direct farm-to-kitchen business model, something which would have previously taken years to achieve.
China's largest e-commerce platform Pinduoduo received more than one billion orders for agricultural products in the first quarter of the year, an increase of 184% compared to the same period last year. Alibaba aims to sell 400 billion yuan (US$61 billion) worth of agricultural products a year on its platform by 2022.
The coronavirus pandemic was a key turning point. Producers often relied on national offline distributors to deliver their goods, but as lockdown measures swept the country early this year, logistics providers could not fulfill orders.
Online retailers stepped in to fill the gap, with the likes of JD.com and Taobao launching promotions for farmers, allowing them to live-stream their content and providing access to their delivery networks.
By May this year, Taobao Live had 50,000 rural live-streamers, as compared to fewer than 1,000 last year. It has plans to reach more than 200,000 by year-end.
For Chinese farmers, the adoption of live streaming comes with a new set of skills to hone, including video production, marketing and customer service.
From broadcasting the process of harvesting produce, to talking to fans about features of goods such as tea leaves, flowers and strawberries, and simply filming their pastoral life, farmers suddenly find themselves becoming online creators with up to thousands, even millions, of views and followers.
While this can be daunting, new challenges come with new opportunities. Many companies are helping to plug the skills gap, offering training workshops and simplifying processes for farmers to begin live streaming.
This digital inclusion of China's rural sector has vast potential for uplifting people's livelihoods. According to Taobao Rural Livestreaming, top rural live streamers can earn a monthly income of more than 10,000 yuan, eight times the average for agricultural producers.
For the rest of Asia, where live streaming is in a fledgling state compared with China, this channel presents an unprecedented digital sales opportunity for farmers.
Thailand's government is pushing the agricultural sector, which employs more than 40% of the country's workers, to embrace technology under the Thailand Agriculture 4.0 initiative. But so far, the trend of rural producers filming their products and marketing them online has not caught on.
Faced with the headwinds of the pandemic and economic uncertainty, live streaming could transform the sector, helping Thailand's rural producers cut middlemen costs by marketing their products to consumers directly.
Suwatchai Songwanich is an executive vice-president with Bangkok Bank. For more columns in this series please visit www.bangkokbank.com