Retail therapy for singletons
China’s $31bn Singles’ Day splurge dwarfs West’s Black Friday
● Overlooking the Huangpu River in Shanghai’s Pudong financial district, a pearl-white, disc-shaped stadium lies nestled amid a cluster of high-rise towers and offices. Seated just outside the entrance earlier this month is what seems like an unusual visitor: a giant, neon cat.
Part brand, part mascot, the cat is, in fact, the wildly popular face of Tmall, an online retail platform owned by Chinese e-commerce giant Alibaba Group. Its appearance helps explain the spectacle unfolding inside to celebrate a unique Chinese annual shopping extravaganza: Singles’ Day.
“Buy, buy, buy!” sings a Chinese girl band as an 18,000-strong crowd fixes its eyes on the gala stage. Adding to the frenzy, Mariah Carey and a string of global celebrities including Australian model Miranda Kerr and Cirque du Soleil, the Canadian theatre troupe, are here too, watched by tens of millions of Chinese viewers streaming it online.
For the uninitiated, the frenzy of excitement surrounding an event ostensibly designed to boost Chinese retail sales may feel inane. But November 11 — better known as Singles’ Day — has become a de facto national holiday in China and a phenomenon.
The name was born of the idea that lonely hearts should have an occasion to celebrate, says Terry von Bibra, Europe general manager of Alibaba, China’s biggest technology company with a market value of $405bn (R5,674-trillion) and 66,000 employees.
“It started as a purely Tmall event. We do so many different things for consumers in China, [we asked] ‘What are we doing for the single consumer?’” he says.
Since 2009, Alibaba has hosted a 24-hour spending marathon each year roughly equivalent to Black Friday in the West.
Since its creation 19 years ago, Alibaba has enjoyed a stratospheric rise from nowhere to report profits of $10bn last year on revenues of $39bn.
This year, the company reaches a turning point. With Jack Ma, co-founder and executive chairman, set to step down, the latest 11/11 offers a window into the future direction of the e-commerce juggernaut.
A good place to start is to glance at Alibaba’s Singles’ Day sales figures. This year, a total of 180,000 brands from China and around the world participated, up from 140,000 in 2017. By just one minute and 25 seconds past
We asked: ‘What are we doing for the single consumer?’
Terry von Bibra
Europe general manager of Alibaba
midnight, Chinese consumers had spent over $1bn, while total sales from 2012’s Singles’ Day were eclipsed after four minutes.
The total amount spent at the end of the 24-hour period was $30.8bn. By comparison, that’s five times the sales volume in the US on Cyber Monday, according to research analysts from Baird. The rising power of the Chinese consumer is indisputable.
According to Bibra, 11/11 has taken on a new life, with Alibaba encouraging companies to find new ways to engage with customers. “Brands should think about how to thank consumers for the 365 days of the year they’re shopping and buying things for their parents and children from you,” he says.
But with great power comes greater pressure. Last year, Alibaba processed 256,000 payments per second at the height of 11/11 activity, and with the number of packages to be delivered rising to more than one billion this year, the strains across the company’s payments, cloud and logistics are immense.
Factor in Alibaba’s new target market — China’s rising middle class — which Alibaba expects to double in number to 600-million by 2022, systems are expected to be more stretched than ever.
It’s why Alibaba is acting fast. It is reaching into China’s rural corners with its “New Retail” service, which looks to help the 80% of businesses in China become digital.
The race to the top of the technological high ground is being watched by the government. A race to the top might mean a surrendering of data to an imposing regime.
According to Michael Evans, president of Alibaba, the company will always ensure its data is anonymised and out of the hands of anyone it works with externally.
Fresh challenges await the company, but, after 10 years of 11/11s, it’s clear that the day is no longer about reaching empty-handed lovers.