China’s ‘Lipstick King’ confronts slower growth, AI disruption in live-stream shopping
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Streamer Li Jiaqi (in black top) is famed for selling billions of dollars worth of beauty products to more than 100 million followers.
PHOTO: REUTERS
- China's livestream shopping faces slower growth amid a weaker consumer market and increased competition.
- AI technology is reducing livestream costs by up to 90%, but human hosts remain vital for building trust and influencing buyers.
- Regulations require clear AI content labelling, and brands focus on profitability, shifting from celebrity hosts to technology-driven operations.
AI generated
SHANGHAI – For nearly a decade, China’s “Lipstick King” has been the face of the live-stream shopping industry, helping to grow a niche format into one of the country’s most important retail channels.
Now, despite slowing growth and artificial intelligence reshaping the sector, Li Jiaqi, famed for selling billions of dollars worth of beauty products to more than 100 million followers, bets it will still depend on people like him.
“Growth may not be as explosive as it was four or five years ago,” said Li, who began live-streaming in 2016, but he added that the sector had moved into a “stable and healthy phase”.
The industry is grappling with a weaker consumer environment, where retail sales rose just 0.4 per cent in August on the year, down from July’s 0.6 per cent, while growth of 1.1 per cent over the first eight months of 2026 reflected sluggish household spending.
Yet, live streaming has reshaped China’s shopping habits, with online retail sales exceeding 36 per cent in 2025, up from less than 18 per cent in 2021.
“It is still growing, but the growth is a lot more difficult,” said Ashley Dudarenok, founder of digital consultancy Chozan.
“Merchants need to compete a lot harder for customers’ wallets... and the expectations of customers are as high as ever, but the budgets are lower.”
AI helps to cut costs
Against that backdrop, AI is rapidly lowering costs.
E-commerce platforms and merchants are increasingly deploying digital hosts that can stream around the clock at a fraction of the cost of human presenters, raising questions about how much of the workforce will remain essential.
JD.com made its AI hosting service free to merchants in December 2025 and said adoption surged within three months. AI hosts can reduce the operating costs of live streaming by 80 per cent to 90 per cent, it added.
“AI is already changing the live-stream e-commerce industry,” Li said. “We’ve been studying how to integrate AI into livestream commerce.”
But the technology has limits, he argued.
“I don’t believe AI can replace human hosts,” he said. “AI is always yesterday’s version of me, while today’s version of me can offer new ideas and new perspectives.”
He sees AI as a tool that can improve efficiency rather than replace presenters, allowing an AI version of himself to keep viewers company overnight while he rests.
He was even more sceptical about AI’s ability to influence buying decisions.
“Human beings are constantly thinking. AI is thinking too, but its thinking is based on previous human thinking,” he said. “That’s why I see AI and live-stream e-commerce as complementary. AI won’t replace human hosts.”
China’s “Lipstick King” Li Jiaqi said he does not believe AI can replace human hosts.
PHOTO: REUTERS
Others in the industry share that view.
Digital presenters still struggle to replicate the trust and judgement that drive sales, said Lu Lin, a 23-year-old host at livestreaming agency Romomo based in the commercial hub of Shanghai.
To a shopper who specifies height and weight, she said, “AI might respond, ‘You should wear size M or size L.’ But a human host would say something more nuanced. It’s not just about answering the question. It’s about building trust with customers.”
The debate is also playing out among regulators and consumers. Rules for clear labelling of AI-generated content took effect in September 2025, while ByteDance-owned Douyin – China’s version of TikTok – has banned fully AI-generated live streams and requires disclosure of the use of digital hosts.
Backlash has greeted some influencers who revealed that AI avatars were appearing in their place.
“I think a human live-streaming host is sort of an endangered species, but it depends,” Dudarenok said, adding that as AI-generated content becomes more common, consumers may gravitate back towards the authenticity of human hosts.
“I don’t think they’re going to disappear completely, but the less successful hosts... they will have to use better tools or change occupations.”
Profitability has become a priority for brands, said Zhang Junling, vice-president of Romomo, as the industry moves beyond the discount-driven model that fuelled early growth.
As margins tighten, dependence on celebrity hosts is dwindling, with fierce competition making large-scale systems, technology and operational capabilities more critical, he said.
“Competition is no longer simply between individual live-stream channels or individual hosts,” Zhang added. REUTERS