Singles’ Day: Are You Ready?

Stephen DeAngelis

November 1, 2017

Last year, Alibaba Group reported Singles’ Day sales “totaled $17.8 billion of gross merchandise volume across Alibaba’s China and international retail marketplaces, a 32% increase over [2015’s] shopping event.”[1] If you’ve never heard of Singles’ Day, you will. Daphne Howland (@daphnehowland) reports, “Shoppers from 235 countries and regions completed cross-border Singles’ Day transactions [last year], and 37% of total buyers purchased items from international brands or merchants. Japan, the U.S., South Korea, Australia and Germany led all countries selling to Chinese shoppers on Singles’ Day. The top U.S. brands were Apple, Nike, New Balance Playboy, and Skechers, while the top European brands were Siemens, Philips, Adidas, Jack Jones and Only.”[2] Jack Ma, Alibaba’s founder, co-opted a little known Chinese pseudo-holiday to become the world’s largest shopping holiday. The so-called “holiday” is neither official nor does it have deep, historical roots. Eva Dou (@evadou) reports, “Singles’ Day was a tongue-in-cheek holiday begun by some Chinese young people in the 1990s to commemorate the lonely hearts among them, with the evocative date 11-11.”[3] According to Wikipedia, “Singles’ Day is an entertaining festival widespread among young Chinese people, to celebrate the fact that they are proud of being single. The date, November 11th (11/11), is chosen because the number ‘1’ resembles an individual that is alone.” Michael Zakkour (@michaelzakkour), Vice President, China/Asia Pacific Practice, at Tompkins International, reports, “What used to be known as ‘Singles Day’ in China has been redefined and rebranded as ‘The 11/11 Global Shopping Festival’ by the holiday’s e-commerce patron saint, Alibaba.”[4]

 

Singles Day and the Digital Path to Purchase

 

Zakkour reports Singles Day began a decade ago when “Alibaba used Singles Day to offer massive discounts to draw consumers to their platforms Tao Bao and then Tmall.” The marketing ploy worked and by 2015 it had become “the largest single-day retail event in human history.” In the United States, retailers look to Black Friday and Cyber Monday sales to boost their bottom lines; but, retailers would do well to try and grab a piece of the Singles Day pie as well. According to Zakkour, Jack Ma’s dream is to use the holiday to reinvent and digitize retail — “first in China, and then around the world, and to take the first step in ‘serving two billion global customers’.” Retailers may well ask themselves whether Singles’ Day will replace Black Friday as the kick-off of the holiday shopping season. Moving the start of the shopping season up by several weeks provides retailers with more opportunities to sell their wares both at home and abroad. Additionally, moving the holiday shopping season forward takes advantage of trend already being demonstrated by mobile shoppers on the digital path to purchase. Corinne Ruff (@corinnesusan) reports, “Nearly 60% of mobile-first shoppers start their holiday shopping between October and mid-November, compared to just 36% of in-store-first shoppers that start early, according to a Facebook IQ study.”[5]

 

Retailers, however, have been reluctant to embrace Ma’s vision of serving two billion global customers on Singles’ Day, even though it has six times the sales volume of Black Friday. Hayley Peterson (@hcpeterson) explains, “US retailers … have been reluctant to add another ‘Black Friday’ or ‘Cyber Monday’ to their fall calendars. ‘All retailers are laser-focused on ramping up for the period from Black Friday to Christmas,’ says Danny Silverman, head of product strategy at ecommerce analytics firm Clavis Insight. ‘To participate in Singles’ Day would sap sales from that critical period.'”[65] It seems to me, a sale is a sale, whether it’s made on 11/11 or on Black Friday. With mobile-first purchasers already shopping early, joining the Singles Day craze seems like a no-brainer. Unfortunately for U.S. retailers, there is a hitch making them reluctant to jump on the Singles’ Day bandwagon — 11/11 is Veterans’ Day in the United States. Overlooking or downplaying Veterans’ Day to promote Singles’ Day could result in significant domestic backlash. Peterson notes U.S. retailers that do participate in the global sales effort have opted to adopt a two-pronged marketing strategy — one strategy for the U.S. and another strategy abroad. She reports, “Several US-based companies do in fact participate in Singles’ Day — including Walmart, Macy’s, Gap, Target, and Costco — but very few of them offer deals to domestic shoppers.”

 

Targeting Global Markets

 

For retailers desiring to take part in the Singles’ Day celebration, Lindsey Grossman (@ltgrossman) recommends concentrating on Chinese consumers.[7] She offers seven suggestions to help retailers get started:

 

  • Seek guidance. “Online giants like Alibaba and Tencent have access to a wealth of knowledge about Chinese consumers and share some of those customer insights publicly. Another option is to seek out groups like the Global Innovation Forum, which connects entrepreneurs with local innovators, policymakers and influencers (including logistics and financial services companies helping small businesses sell to China).”
  • Get to know your customer. “The rising middle class in China has spurred demand for high quality goods and exclusive international experiences. Statistics show that Chinese consumers buying outside of China are most interested in luxury goods and retail (clothes and jewelry), health and wellness (vitamins and baby formula) and travel.”
  • Get discovered. “Getting your product discovered in China is challenging for an overseas business. Leveraging powerful Chinese e-commerce ecosystems like Tmall, can be a relatively low-cost way to increase visibility and learn about the Chinese market. … Given the competition from large international brands who also leverage Tmall to sell their goods, smaller brands should consider working with a third-party operator to support their end-to-end operations and enhance their discoverability on the platform.”
  • Make the checkout experience a breeze. “Offering payment methods that Chinese consumers use daily is imperative if you want Chinese customers to complete the checkout process. Alipay and WeChat Pay represent two of China’s most widely used payment methods with over a billion users between them.”
  • Use Short Message Service (SMS) alerts, especially for subscriptions. “While SaaS and subscription companies are becoming increasingly popular in China, consumers are not yet accustomed to agreeing in advance to make recurring payments for products. A best practice, especially when working with Chinese consumers, is to send an SMS reminder (or even better, a message on WeChat) before taking a recurring monthly or annual subscription payment. Chinese consumers tend to check their SMS and WeChat app more frequently than email.”
  • Understand the culture of buying. “Customers in China also like to scrutinize products from many different angles before making the decision to buy. Take a look at Alibaba’s numerous e-commerce platforms — especially Taobao — and consider increasing the number of product photos as part of the shopping experience. In China, there’s an accepted norm of haggling down prices. Unlike eBay, where prices go up in an auction, prices on Chinese websites like Taobao might start high and get negotiated down. Don’t be surprised if some consumers write in to customer service and inquire about discounts.”
  • Increase support. “Given the widespread popularity of WeChat and other real-time tools in Alibaba’s e-commerce ecosystem, Chinese consumers have come to expect near-immediate responses from the businesses they buy from. They also often expect to build a relationship with the seller before making a purchase. Consider incorporating a chat feature on your website for real-time engagement and use customer support tools to automate responses.”

 

Singles’ Day is too big for retailers to ignore. As a digital path to purchase event, it dwarfs Cyber Monday or Amazon’s Prime Day. Because it corresponds to America’s Veterans’ Day, it probably won’t catch on in the United States; but, in the years ahead, it may nevertheless mark the beginning of the holiday shopping season.

 

Footnotes
[1] Daphne Howland, “Alibaba’s Singles Day shatters expectations with $18B in sales,” Retail Dive, 14 November 2016.
[2] Ibid.
[3] Eva Dou, “Swinging Singles’ Day: Alibaba Holiday Drives Shoppers in China,” The Wall Street Journal, 11 November 2016.
[4] Michael Zakkour, “How Alibaba Plans To Reinvent Retail With 11/11, Its Global Shopping Festival,” Forbes, 2 November 2016.
[5] Corinne Ruff, “What retailers should know about mobile shoppers for the holidays,” Retail Dive, 5 October 2017.
[6] Hayley Peterson, “Why Americans don’t participate in the biggest shopping day in the world,” Business Insider, 6 November 2016.
[7] Lindsey Grossman, “7 ways to get ready for Singles Day and the Chinese marketplace,” Retail Dive, 6 October 2017.