When midnight hit on 11 November, the world’s biggest shopping event began — not Black Friday as some people might rightly assume, but Single’s Day, a Chinese shopping extravaganza. Started in 1993 as a day for university students to celebrate being single, it was then soon promoted by Alibaba’s Tmall service, transforming into a massive 20-day shopping festival.
In 2018 there were more than 15 million products from 180,000 brands on Tmall, up from 140,000 last year. JD.com, another e-commerce company cashing in on the event, opened a robotic warehouse in 2017 that is capable of fulfilling 9,000 online orders per hour. Then in October, Alibaba opened the country’s biggest autonomous warehouse in Wuxi to help with the Single’s Day demand, expecting to process more than a billion packages. It’s proof of a shifting power in the retail industry, moving away from a US-based powerhouse to one focused on China.
Single's Day and Black Friday revenue in billions of USD
Online retail giant Alibaba has seen its sales grow from around $100 million in 2009 to $30.8 billion in 2018. It helps that at this time last year, the company was rolling out its “New Retail” strategy, attempting to blur the lines between online and offline shopping by setting up pop-up stores in malls across the country. The company is also helping retail stores embrace technology through the use of facial recognition for payments, AR makeup tutorials and scan-and-deliver shopping.
The success of the day is not surprising given that the company had 580 million monthly mobile users on Tmall and Taobao in December 2017, an increase of 31 million from the previous quarter, according to February 2018 SEC filings. Though Amazon is responsible for 40-50 percent of US online retail sales, Alibaba claims 80 percent of online Chinese retail sales and is able to tap into a much larger population.
There’s two things to understand about why Single’s Day — plus Alibaba and, well, most e-commerce businesses — are so successful in China. The first reason is that while the US is just now shifting into a mobile-first society, China has been using mobile devices from the start, for everything from paying, hailing taxis, ordering food and booking travel to shopping, paying bills and more. Then, there’s different “tiers” of cities in the county, not officially recognized by the government but still widely known — Beijing and Shanghai being sophisticated and sprawling Tier 1 cities, with the lower classes being home to cities that are less populous and not as well connected to major urban and shopping areas. The important thing to note is that though lower-class cities are less physically connected, they’re still able to make purchases online — making them a perfect target for online retail conglomerates, like Tmall and Taobao.
Internet giants are increasingly taking over the market share in China and are able to access customers wherever they are, across a variety of different touchpoints — collecting useful and important data on shopping habits, trends and purchase history in the process. Marketers and businesses hoping to enter the market are at the mercy of these online companies, who can dictate how much profit they take in return for their extensive reach.
The next Single’s Day is more important than this as it will be the 11th anniversary of 11/11 and the record sales this year can only mean that next year will be bigger and more successful.