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Five e-commerce trends showcased by Alibaba’s Singles’ Day

Written by Song Jingli Published on 

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The world’s largest online shopping gala sheds a light into Chinese consumption.

The ordinary date of November 11 has become a key battlefield for e-commerce players in China since Alibaba’s executive chairman and CEO Daniel Zhang launched the Singles’ Day shopping festival in 2009.

Today, the shopping bonanza, also known as Double 11, is the world’s biggest online shopping event, which generated in its latest 2019 edition total sales of RMB 268.4 billion (USD 38.4 billion), up 26% from last year, KrASIA reported. That’s more than what major shopping events in the United States, such as Thanksgiving, Black Friday, and Cyber Monday are expected to generate this year. All together.

Alibaba reached the USD 38.4 billion gross merchandise volume (GMV) mark by counting transactions on its network composed by marketplaces Taobao, Tmall, and other sites including Lazada, AliExpress, Kaola, and new retail and consumer services platforms, in the 24-hour period on Nov 11, 2019.

Alibaba said it will deliver 1.3 billion parcels, which means that, on average, nearly every resident in China will get one parcel delivered by a courier in the coming days.

This is a great achievement in terms of sales, when viewed over a time span of 11 years, although some are doubtful over Alibaba’s officially released numbers. In 2009, the Singles’ Day GMV was only RMB 52 million.

Some analysts argued that part of these parcels might be returned for various reasons, resulting in a lower value in final purchase, while others added that Alibaba has actually included a period of days before Singles’ Day into the counting, as some products participating in this promotion were on a pre-sale model, demanding buyers to pay the deposits first and the remaining part on November 11.

To understand better this shopping phenomena, KrASIA will dig a little deeper to gain a better picture of China’s e-commerce sector and shed a light into Chinese consumption.

Alibaba’s promotion-spurred growth is slowing

This year’s Singles’ Day GMV mark of RMB 268.4 billion represents the slowest growth in the decade, up 26% year-over-year.

Annual GMV growth rate for 2018 Alibaba’s Singles Day was 27%, while the figure in 2017 was 39.3%, and 32.3% in 2016, according to KrASIA‘s calculations based on yearly data listed on Alizila.com, Alibaba’s corporate news portal.

Alibaba still dominates in China’s consumer-facing e-commerce sector

Alibaba’s major rival, JD.com, reached total sales worth RMB 204.4 billion on its platform between Nov 1 and Nov 11, according to its official WeChat account.

Although the two companies might differ on how they define “transaction volume” and “GMV”, the huge gap is visible, as the transaction volume during these 11 days was only near Alibaba’s 24-hour Singles Day GMV.

Pinduoduo, the rising challenger to both Alibaba and JD.com, did not disclose its GMV data on Nov 11.

More brands are joining Alibaba, indicating its importance for worldwide merchants

Brands are attracted by Alibaba, especially its B2B marketplace Tmall, and also its C2C market place Taobao, although the latter is still included on the 2018 ‘Notorious Markets’ list compiled by the Office of the United States Trade Representative, for reportedly “engage in and facilitate substantial copyright piracy and trademark counterfeiting”.

More than 200,000 brands worldwide participated in the 2019 Singles’ Day shopping fest, up from 180,000 brands in 2018, according to a press release of Alibaba. In specific, a total of 1 million new products were launched for the day.

A total of 299 brands surpassed the RMB 100 million (USD 14.3 million) GMV mark during this year’s Singles’ Day on Alibaba’s platforms. Among those brands, 15 of them even surpassed RMB 1 billion, according to a company’s press release.

The top gainers were Apple, Bose, Estée Lauder, Gap, H&M, L’Oréal, Levi’s, MUJI, Nestlé, Nike, Philips, The North Face, Under Armour and Uniqlo.

Live streaming is becoming increasingly important for merchants

Alibaba said that live streaming is the go-to option for Chinese consumers when seeking out new products.

Live streaming is now embedded in the Taobao’s app so that its users can shop for the items they see immediately without leaving the app, while Alibaba also has a standalone app called Taobao Live Streaming, in which special discounts are available.

In only one hour, GMV made via Taobao’s live streaming platform exceeded last year’s total sales on the same channel during the entire day, and within hours, by 8:55 a.m., a total of goods worth RMB 10 billion were purchased via Taobao or Tmall by users when watching live-streamed presentations.

Live streaming has also been leveraged by short video apps such as ByteDance’s Douyin and Kuaishou to sell goods. However, JD.com and Pinduoduo have not rolled out their live streaming services to boost sales.

The post-1990 generation is buying more particular products such as pet food and wigs

Those born in the ’90s and in their twenties had bought 42% of all wigs on Alibaba’s marketplaces by 8:00 a.m., while those born in the ’80s grabbed 26% of goods which could be used by bald people, according to DT Finance, a Chinese media outlet.

Shanghai, Beijing, Guangzhou, and Shenzhen were the top four cities where buyers hit the “order” button for these wigs, added DT Finance. These four top-tier cities are widely believed to be workplaces with the highest pressure, a factor for people getting bald.

Among all users who had purchased foods for dogs, and cats, by 2:00 p.m. on Nov 11, those born in the ’90s accounted for 44%, while those born in the ’80s made up another 26%, according to DT Finance.

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