Artificial intelligence (AI) avatars are rapidly gaining prominence, demonstrating their immense commercial potential and challenging the conventional role of human hosts. A recent livestreaming session conducted on Baidu’s e-commerce platform, Youxuan, showcased this transformative power, generating an astonishing 55 million yuan (approximately US$7.6 million) in sales over a period exceeding six hours. This remarkable performance featured digital renditions of prominent livestreamer Luo Yonghao and his co-host, Xiao Mu, marking a new milestone in virtual human technology applications for sales.
Luo Yonghao, who commenced his successful livestreaming career in 2020, confirmed that this was his inaugural experience leveraging virtual human technology for commercial purposes. The AI avatars used in this record-setting session were meticulously created by Baidu’s generative AI, which analyzed an extensive five-year archive of video content featuring Luo and Xiao Mu. This sophisticated analysis allowed the AI to accurately replicate the hosts’ distinct personalities, mannerisms, and established styles, creating highly convincing digital counterparts capable of engaging with audiences and driving sales effectively.
While the economic advantages, such as reduced operational costs and the capacity for continuous, non-stop streaming, are undeniable, the integration of AI avatars also introduces new complexities. These include navigating compliance with advertising regulations and adhering to various platform rules. Despite these challenges, Luo Yonghao’s team has expressed intentions to conduct more AI-hosted streams in the future, recognizing the immense potential for scalability and efficiency. Furthermore, they are exploring the development of multilingual versions of these AI avatars, which could significantly expand their reach to global audiences, transcending linguistic barriers and tapping into new international markets.
This breakthrough in AI-powered livestreaming is not an isolated phenomenon but rather a natural progression within China’s uniquely evolved e-commerce landscape. The country has pioneered the seamless integration of entertainment and commerce through livestreaming over the past decade. As far back as 2018, Taobao, one of China’s largest e-commerce platforms, reported generating over 100 billion RMB (equivalent to approximately $15.1 billion USD) in gross merchandise volume through livestreaming alone, representing an astounding 400% year-on-year increase. This robust foundation established livestreaming as a primary shopping channel in China, deeply embedded in consumer behavior; for instance, in 2016, approximately 18% of total retail sales in China occurred online, significantly higher than the 10-12% seen in the United States during the same period. The market was already characterized by a massive audience of 456 million livestream viewers and thousands of human hosts collectively producing an estimated 150,000 hours of content daily. Unlike Western platforms, where livestreaming primarily focuses on gaming and entertainment, Chinese consumers have long utilized these platforms specifically for product discovery and direct purchasing, thereby creating a fertile ground for AI-driven innovation.
The superior performance demonstrated by AI hosts, exemplified by the 55 million yuan generated in just over six hours, signals a potential and profound restructuring of the livestreaming labor market. Industry experts have observed that while AI avatars may not yet surpass the sales capabilities of elite human sellers, they consistently outperform average livestreamers. This has contributed to a reported 20% drop in average wages for human hosts, highlighting the economic pressure faced by human talent. The economic rationale for adopting AI avatars is compelling: they eliminate the need for costly production teams and dedicated studios, and their ability to operate continuously, 24 hours a day, seven days a week, without breaks, addresses both cost and scalability limitations inherent with human hosts. For brands and e-commerce platforms, the investment calculation becomes increasingly straightforward: AI hosts offer the promise of achieving superior results at a lower cost, while also mitigating the unpredictability often associated with human influencers, such as scheduling conflicts, performance variations, or public relations issues.
In response to this rapid technological advancement, Chinese authorities are proactively developing regulatory frameworks to address the unique challenges posed by AI-powered digital humans in livestreaming. Zhejiang Province, a key economic hub, has already introduced 30 specific guidelines. These guidelines explicitly prohibit the unauthorized use of AI deep synthesis technology and mandate that digital humans must be clearly identifiable as non-human entities to prevent deception. Concurrently, major platforms are also establishing their own internal policies. WeChat, a dominant social media and messaging platform, has adopted a particularly stringent approach by entirely banning AI-powered digital influencers on its livestreaming platforms, aiming to preserve content authenticity and consumer trust.
Furthermore, the Cyberspace Administration of China has proposed comprehensive regulations that would require clear labeling of all AI-generated content, a measure designed to protect consumer interests and prevent any misleading or deceptive practices. These regulatory responses underscore the inherent tension between fostering technological innovation and ensuring trust and transparency within the rapidly evolving livestreaming marketplace, with a strong focus on preventing marketing tactics that could erode consumer confidence.
Featured image credit: Youxuan
