The Rise of Sleepless Digital Hosts: Can They Challenge Top Streamers and Unlock a Trillion-Dollar E-Commerce Market?

Digital humans are evolving at remarkable speed.

A decade ago, they were little more than static “virtual models.” Today, they can livestream, sell products, and even generate real revenue. Their rise in e-commerce reflects both rapid AI advancement and the industry’s urgent need to cut costs and boost efficiency.

In 2024, JD.com’s Richard Liu unveiled his digital avatar for livestream selling. In 2025, Baidu partnered with tech personality Luo Yonghao to launch a digital version of him—setting new livestream sales records.

According to representatives from “Make Friends,” Baidu’s AI-powered digital humans can now achieve both “form and spirit” — interacting smoothly with audiences in a way that feels almost soulful. As a top-tier IP, Luo Yonghao can offload repetitive, time-consuming streaming through his digital twin and focus on product selection and creative work.

Yet, industry voices remain clear: no matter how realistic, digital humans still cannot fully replicate or surpass real human hosts. The livestreaming battlefield remains challenging, and many insiders emphasize that digital humans’ main value is still cost reduction.

E-commerce merchant Li Jin notes that since Taobao’s Double 12 test in 2021, digital human hosts have been used across major platforms, with some brands streaming 4–12 hours daily. Their advantages are obvious — 24/7 streaming, multilingual support, and scalable replication across multiple rooms. However, they lack emotional resonance and still struggle with real-time, high-quality interaction.

An executive from a livestream agency adds that cost pressures have pushed merchants to adopt digital hosts, though platforms like Douyin keep tight restrictions on them. “Douyin likely won’t loosen rules. It is fundamentally different from platforms that grew on transactional commerce; its core is still content.”

The rise of digital human hosts reflects both technological progress and the search for order in a chaotic e-commerce environment.

Top human streamers charge sky-high appearance fees, with single sessions costing millions of yuan. Scandals and “house-collapse” incidents only heighten risks for brands relying on star anchors. In contrast, digital humans never sleep, take no commissions, and can replicate the persona of popular streamers, capturing traffic around the clock.

But can such a seemingly perfect solution scale?

A Costly Trial Still in Proof Stage

According to sources familiar with the project, Baidu’s collaboration with Luo Yonghao was overseen personally by Robin Li. The effort required extensive linguistic and visual data — Luo supplied text from past livestreams, sales scripts, interaction habits, high-resolution photos, videos, and user behavior data. All of this formed the foundation for training a highly realistic digital twin.

Industry insiders say Baidu invested heavily in the partnership. Whether the digital human team will launch another celebrity avatar this year remains uncertain due to budget demands.

The results, however, were compelling. Luo’s digital debut drew over 13 million viewers in six hours, generating more than RMB 55 million in GMV. In some 3C categories, performance even surpassed his real-person broadcasts in May.

During the session, Luo’s trademark humor remained intact. His digital self bantered with digital co-host Zhu Xiaomu in a style nearly indistinguishable from real life. Micro-expressions, tone, eyebrow raises, smiles—even climbing onto a chair to test its backrest—appeared fluid and lifelike.

E-commerce competition is intensifying. With China’s internet population nearing saturation, the market has shifted from expansion to retention. As of June 2025, China had 976 million online shoppers—86.9% of all netizens.

In September 2024, top influencer Zhang Dayi abruptly halted new product launches, citing industry pressure: the pace of change is too fast, platforms too numerous, competition too fierce. Navigating between Taobao, JD.com, Pinduoduo, Douyin, and others is “harder than walking a tightrope,” she wrote.

Against this backdrop, digital human livestreaming has emerged as a possible answer to growth anxiety.

“Make Friends” reports that Luo Yonghao’s digital avatar used AI multi-agent coordination to achieve three times the interaction frequency of human hosts and generated more than 97,000 words of product explanation via AI knowledge retrieval.

Crucially, digital hosts supplement rather than replace humans. During peak hours (8 p.m.–midnight), real hosts focus on high-interaction content. During off-peak times (such as late night), digital humans maintain traffic. Humans emphasize categories requiring physical demonstration (e.g. clothing), while digital humans focus on standardized items like 3C products.

Still, the digital-only model is far from proven. While Luo’s digital host achieved a 78% substitution rate for standardized goods in his debut, large-scale expansion remains under evaluation.

Some industry leaders say that while digital hosts dramatically reduce labor costs, their efficiency boost remains uncertain. Adoption is currently limited to categories with less reliance on live sales performance.

Ten Years of Progress: From “Display Dolls” to Real Sales

Digital humans were once expensive showpieces. A Baidu executive revealed that first-generation digital models cost RMB 5–6 million each and took six months to build. Early iterations focused on voice synthesis and image modeling.

In 2020, Baidu launched AI digital character Du Xiaoxiao, then introduced digital service features in Baidu App in 2022. But monetization lagged and business impact remained minimal.

That changed in 2021 with digital beauty influencer Liu Yexi, who amassed millions of followers in days on Douyin. Capital flooded the sector, pushing digital humans into the spotlight.

Though Liu’s popularity has cooled, production costs have plummeted. Industry sources say that creating a digital human now ranges from a few hundred yuan to tens of thousands, with only the most finely tuned models costing more.

In 2023, an AI arms race began. In early 2024, Baidu revealed that 20% of GMV growth in Baidu Youxuan came from model-driven transactions. The platform also opened backend tools allowing merchants to create digital hosts for free.

By April 2025, Baidu announced its “3.0 persuasive” digital human — ultra-realistic voices and faces, native script generation, and AI “brain” capability. Two months later, Luo Yonghao’s digital version successfully achieved livestream performance comparable to real humans.

Baidu isn’t alone. In 2020, JD.com introduced Yanxi. In 2024, a digital “Dong Ge” based on Richard Liu drew over 20 million viewers on debut and generated more than RMB 50 million in sales. By 2025, Yanxi evolved into JoyAI.

JD claims its JoyStreamer hosts cost just one-tenth of real humans while outperforming 80% of them. Digital hosts have surpassed 17 million total viewers and driven more than RMB 700 million in GMV.

During the 618 shopping festival, JD even organized the first large-scale “president livestreams,” deploying digital avatars of top brand leaders including Gree’s Dong Mingzhu and Hisense’s Hu Jianyong. More than 5,000 brand studios now use JoyAI, which has boosted off-peak conversion rates by 30%, contributing tens of billions of yuan in GMV.

Scaling Still Faces Multiple Hurdles

There is no doubt digital humans can perform, but mass adoption remains distant.

Some experts believe Luo Yonghao’s success stems largely from his unique persona. Without a strong brand identity, ordinary people have little hope of achieving similar results through digital avatars. Meanwhile, user curiosity about virtual hosts may be temporary, and real emotional connection is still hard to replicate.

In 2024, e-commerce expert Li Mingtao said digital humans cannot replace real hosts because emotional bonding is a human advantage. Digital hosts are low-cost, professional, and fast to iterate, but still struggle to inspire real fan loyalty. To maintain user experience, platforms have begun restricting digital livestream time.

Regulatory pressure is also increasing. China’s 2024 policy on “AI-generated synthetic content” mandates clear labeling on all AI-generated images, videos, and virtual scenes. Digital streams are allowed — but must declare themselves.

Failure to do so could mislead consumers, blur accountability, and create risks in fraud, privacy, and data abuse.

Platforms are cracking down. Douyin prohibits virtual hosts from posing as real people. In late 2024 alone, the platform shut down more than 170,000 recorded livestream rooms, banned over 30,000 accounts, and removed 11 agencies involved in illegal virtual broadcasting.

These “never-off-air” AI hosts must now disclose their identities. Balancing digital and human roles has become essential. Overuse of digital avatars could provoke backlash among human hosts and undermine industry stability. Meanwhile, digital humans still need better emotional and interactive realism.

Companies are experimenting with hybrid models: real hosts plus store broadcast, digital rotation support, and more. So far, no single digital stream or store feed rivals top human streams in viewership or sales.

For companies like “Make Friends,” once heavily dependent on Luo Yonghao, digital humans are seen as amplifiers, not replacements. The team may consider building avatars for mid-tier hosts in the future.

Even so, digital trials are bringing value. Analysts note that Luo’s avatar helped Baidu differentiate itself as an AI-driven e-commerce platform, opening new possibilities for growth.

Digital humans have begun to shake the livestreaming world. Whether they can scale — and meaningfully transform the trillion-dollar e-commerce market — remains the question.