(Yicai Global) June 19 -- Digital sales hosts are becoming more and more popular by Chinese livestreamed e-commerce merchants due to their low costs and high sales conversion rate in some areas. But an industry insider said that it will still take many years for marketing by avatars to really develop fully, The Paper reported yesterday.

It will take at least five to 10 years for virtual e-commerce hosts to become more sophisticated, a person in charge of ‘Make a Friend,’ a livestreamed e-commerce platform that uses Key Opinion Leaders.

The biggest advantage of using virtual hosts lies in the cost savings, as it takes a lot of time and resources to train a real person, the report said, citing distiller Guotai Spirits.

Avatars can also work around the clock and their transaction conversion rate, or the proportion of sales to the number of visits to the studio, is nearly triple that of real hosts. Guotai stopped using human livestreamers a month after it launched its digital sales hosts.

Sales at another vendor have increased 99-fold since it started using avatars in January, the report said. The transaction conversion rate is now 11 percent, 31 times that of real people.

Despie some success stories, most avatars are still coarse and crude, and so they are unable to attract customers unless the discounts are generous, other industry insiders said.

A leading cosmetics firm uses digital salesmen between 11 p.m. and midnight, and does not use them during prime time and for holiday promotions, the report said.

The cost of virtual hosts has dropped significantly in recent years to under CNY1,000 (USD140), whereas before it cost several thousand yuan an hour, the cosmetics company said. It therefore makes sense to use virtual hosts in off-peak times as it is difficult for human hosts to broadcast 24 hours a day.

Editor: Kim Taylor