Investigating the cross-channel impact of live streaming on retail sales: Evidence from a live streaming e-commerce platform in China

The rapid advancement of live streaming technology has given rise to a novel selling channel, enabling real-time, two-way interaction between retailers and consumers and thereby transforming the operational landscape of e-commerce channels. When considering the adoption of live streaming, retailers must carefully evaluate potential cross-channel spillover effects, as these can significantly impact overall sales performance after implementation. However, the presence, magnitude, and underlying mechanisms of such spillover effects remain poorly understood and warrant further empirical investigation. This research aims to evaluate the overall effect and the cross-channel spillover effects generated by the introduction of live streaming channels, along with their underlying mechanisms. Using a difference-in-differences combined with propensity score matching approach and panel data from a leading e-commerce platform in China. We find that the introduction of live streaming channels significantly enhances overall shop sales performance. Furthermore, it not only enhances the sales performance of live-streamed products on traditional online channel (inward cross-channel spillover effect) but also drives increased sales of non-live-streamed products within the same shop on traditional online channel (outward cross-channel spillover effect). Additionally, the implementation of live streaming channels substantially improves a shop's reputation and expands its fan base, indicating that live streaming plays a key role in building brand equity.