By Angus Street
China and the Chinese diaspora are gearing up for the world’s biggest online shopping festival – Singles’ Day – on November 11th.
Singles’ Day (光棍节) originated in 1993 at Nanjing University as an on-campus celebration of the young and dateless. November 11th or 11/11 was chosen for the cluster of ‘ones’ in its numerical date because the number ‘1’ as everyone knows, is the loneliest number. But rather than wallowing in self-pity, Single’s Day was something special, a chance to spoil yourself through unconscious consumption like couples do on Valentine's Day.
In 2009, Alibaba caught the zeitgeist offering ‘Double 11’ deals and trademarked the term in 2012, turning a self imposed celebration of singledom into a multi-billion dollar annual shopping extravaganza.
The commercial figures surrounding Singles Day are epic, extraordinary, and scary. To give you an idea of what to expect this year, here’s what happened in 2015.
- 40,000+ vendors participated
- 6 million products were on offer from over 30,000 different global brand
- 2 million pieces of underwear were sold within first hour
- 120,000 orders placed every minute
- $1.8 billion worth of sales in the first 8 minutes
- $6.5 billion worth of sales in the first 1.5 hours
- $17.64 billion worth of sales in the first 24 hours
Under Jack Ma’s visionary leadership, Alibaba will undoubtedly increase these numbers in 2016. While I didn’t back a winner in the Melbourne Cup, I’d be putting my money on the fact that Alibaba’s Singles’ Day will be even bigger and better this year despite competitors such as JD.com jumping on the Singles’ Day bandwagon.
Alibaba controls over 50 per cent of the e-commerce market through its network of C2C (Taobao), B2C (Tmall), B2B (1688.com & AliExpress) and Flash Sale (JuHuasuan) platforms.
For a seller, Alibaba is a market within an already massive market. In order to create brand awareness and generate sales, vendors must spend significant amounts on advertising within the Alibaba platforms, offer aggressive discounts and compete to ensure that when a buyer searches for their products, its at the top of the page.
For a buyer, Alibaba is a powerful search engine. In the same way the Western world relies on Google to scour for discounts, sale items and product information before purchasing. This is great for both consumers and vendors, as they have a captive audience of shoppers who are visiting with a purpose – to spend, save and shop.
So what tricks does the world’s largest retailer have up their sleeve for another record-breaking Singles’ Day?
Alibaba has already launched a series of campaigns to get the ball rolling. On 23 October, Alibaba live streamed an eight-hour fashion show in Shanghai with fifty international brands, during which viewers were able to pre-order the clothes as displayed by models walking down the runway.
Alibaba has also released an augmented reality mobile game with consumers following a "Tmall Cat" mascot to merchants around China to earn discounts and prizes.
Most importantly, Alibaba will work closely with its thousands of vendors to ensure maximum consumer engagement. Vendors will be asked to slash their prices to participate in Singles’ Day with a minimum discount of 50% required on their products. This not only impacts the distributor or wholesaler mark-up, but it also affects the slim margins that manufacturers are making. This is tough for Australian suppliers who traditionally have tighter margins.
Campaigns are simultaneously launched to have products preloaded into consumers’ carts and at midnight, those transactions are automatically processed through Alibaba’s payments service, Alipay. This generates a huge spike in sales and kicks off the on-the-day media and promotions campaign to drive consumers to Alibaba platforms.
Participation in Singles Day is the year’s most important day to create brand awareness so taking a hit to the profit margin in favour of direct consumer engagement is a decision worth considering. Remember, those epic, extraordinary, and scary figures.
The reach Alibaba generates from its incredibly clever marketing and promotional campaigns to ensure consumers, from the far reaches of regional China to the high income suburbs of Tier 1 cities, will get the chance to view, engage and purchase your products.
Now, it’s time to ensure you leverage all that Singles’ Day has to offer after the frenzy and chaos fades away and convert discount shoppers into loyal customers. Enjoy the craziness of Singles Day and good luck in grabbing a bargain just like Alibaba.