Keep on shopping - how Singles Day keeps getting bigger
For the first time, Singles Day will be hosted in six countries in Southeast Asia capitalising on the nascent e-commerce sector in these countries.
Singles Day is by far the world's largest shopping event - and the records just continue to tumble.
Since e-commerce giant Alibaba started the retail festival in 2009 (adopting an obscure Chinese alternative holiday to Valentine's Day), sales have risen from around US$7 million to US$24.2billion in 2017, more than double the online sales for the US Thanksgiving period, including 'Black Friday'.1
The 24-hour period of '11.11' (as it is also known) demonstrates the sheer power of Chinese consumption. Last year, Alibaba processed 812 million orders, handling 1.5 billion transactions through its payment service AliPay, peaking at 256,000 transactions per second. This Sunday's event is set to be even bigger.2
From discount day to global extravaganza
Just 27 retailers were involved in the first 11.11. Now, more than 180,000 global brands are participating through Alibaba's Tmall and Taobao retail platforms (with the company's rivals also establishing their own discount deals).
But the event is far more than a chance to find bargains online. Singles Day also demonstrates Alibaba's 'New Retail' model in action, merging the online and offline experience through the use of disruptive technology.
As an example, 200,000 'mom & pop' stores across China will be providing online sales promotions and augmented reality-based red packets, offering discounts at virtual'corner stores', operated by Tmall.
Source: Bloomberg. eMarketer, comScore, Bernstein analysis; US date covers 5 days from Thanksgiving through Cyber Monday
Expanding the global reach
In its 10th anniversary year, 11.11 is now part of a month-long Global Shopping Festival (pre-orders have been available through Tmall since the middle of October). Not only that, a second spin-off event, geared towards smaller companies is being promoted for 12 December (or '12.12').
The emphasis though as 11.11's footprint grows ever larger, is firmly on global reach. For the first time, Singles Day will be hosted in six countries in Southeast Asia, through Alibaba offshoot Lazada, capitalising on the nascent e-commerce sector in these countries. Indications are that in countries like Indonesia, the scale of e-commerce has been understated and it is already starting to eat into the profits of offline retail.
From an emerging market investor perspective, 11.11 demonstrates not just the unmitigated power of e-commerce in these regions, but also how analytics are leading to a greater understanding of consumption patterns.
A prime example is that Alibaba has greatly improved the technology it uses for its recommendation feeds on its platforms, meaning there is now a far greater likelihood of users buying the products they click through to (and from the company's point of view they are also looking for ways that this can be monetised).
Last year, Alibaba processed 812 million orders, handling 1.5 billion transactions through its payment service Alipay, peaking at 256,000 transactions per second.
With planning already underway for Singles Day's second decade, there is little sign of the juggernaut slowing down.
1 Bloomberg, eMarketer, comScore, Bernstein analysis.
2 Statista, Alibaba, comScore, media reports
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