China’s Singles’ Day (November 11th) has grown into the biggest shopping event on the retail industry calendar, generating more sales than Black Friday and Cyber Monday combined.
What started out as an occasion to celebrate being single has exploded into a multi-billion dollar shopping extravaganza that attracts participation from hundreds of thousands of international retailers.
It’s undeniably an event that offers massive potential for companies to boost their brand exposure and drive sales, but it’s vital to find the right marketing and communication strategies to really make the most of Singles’ Day.
The Singles’ Day Phenomenon
Singles’ Day traces its origins all the way back to 1993, when students at Nanjing University chose ’11/11′ as the date to celebrate being single. The tradition quickly expanded to other universities and eventually across Chinese society as a whole.
While there is still an element of Singles’ Day that celebrates either being single or being in a relationship, it is now primarily a shopping holiday, largely because of the influence of Alibaba Group. About a decade ago, the Chinese retail conglomerate spotted the potential to turn the occasion into a consumer event and has been reaping the rewards ever since.
In 2018, Alibaba set a new Singles’ Day record with approximately 213.5 billion yuan ($30.7 billion) in sales over the course of just 24 hours.
The event has become much more than just a Chinese concern, with some 180,000 international brands participating last year. According to experts, one of the key factors in the success of Singles’ Day is the way brands approach it, with an emphasis on product quality and the overall customer experience, rather than simply cutting prices.
Making the Most of Singles Day
Chris Tung, chief marketing officer at Alibaba, told Campaign that Singles’ Day is “totally different” to events such as Black Friday and the traditional Boxing Day sales in the UK. Rather than choosing from whatever items are available at the lowest possible price, consumers have “trust that the best brands are launching the newest models” on Singles’ Day, according to Mr Tung.
Apple’s iPhone XR, for example, debuted in China shortly before November 11th 2018, while both Adidas and Nike have released exclusive and limited-edition shoe designs specifically for the event.
Many brands start their planning for Singles’ Day six months ahead of the event, Mr Tung said, with some even allowing a whole year to prepare for the anticipated impact on procurement and inventory.
For many consumers, this shopping holiday is more about the overall experience than simply finding bargains.
Tiffany Lung, of Hong Kong-based research and tech firm Tofugear, told CNBC the American retail sector “runs on a price-driven concept”, which “ultimately upholds” the whole idea of Black Friday sales.
She contrasted this with how China celebrates Singles’ Day, “with a fun and social experience through games and entertainment”.
This ties into a theme that has been explored before on the Locaria blog – the need for brands hoping to succeed in China to offer something deeper and more meaningful than simply low prices. Chinese consumers are much more likely to connect with retailers that present a compelling brand message, or provide content that elicits an emotional reaction.
To realise the potential of Singles’ Day, you need to prepare with targeted market research, scoping and testing. You also need to have the right tools, knowledge and communication capabilities to ensure investment in strategies such as social media marketing and SEO will yield results.
China’s Ecommerce Explosion
The runaway success and rising international significance of Singles’ Day is part of a wider trend of growth in China’s ecommerce industry as a whole. Finding the right recipe for success in this market could elevate your business to the next level of international success.
According to eMarketer, China is on course to overtake the US and become the world’s leading retail market in 2019, with total sales rising by 7.5 per cent to $5.636 trillion. US retail sales are expected to increase by 3.3 per cent to $5.529 trillion.
Offering some background to the trend, Monica Peart, senior forecasting director at eMarketer, said: “In recent years, consumers in China have experienced rising incomes, catapulting millions into the new middle class. The result has been [a] marked rise in purchasing power and average spending per person.”
The World Economic Forum identified the popularity of shopping festivals like Singles’ Day as one of the key contributors to China’s “ecommerce explosion”. Another significant factor is a recent “consumption upgrade”, which has seen increasingly affluent consumers place a greater emphasis on high-quality, niche products and prestigious international brands.
Regardless of the underlying drivers of this trend, it’s clear China’s retail industry – and ecommerce in particular – is a source of great opportunity for brands with international ambitions.
Locaria can offer the locally relevant expertise and market knowledge you need to make the most of this potential. To find out more, call us on +44 (0)20 3948 6800, or browse through our services and solutions.