Voice of the Industry

The mindblowing effect of Singles Day for ecommerce and what you need to do to be a part of it

Friday 29 October 2021 12:37 CET | Editor: Alin Popa | Voice of the industry

Chinese unofficial holiday and shopping season Singles Day is a huge event for ecommerce. Elena Gatti from Azoya tells us how companies should best approach this opportunity

When it comes to ecommerce, China is ahead of the world. The scale of it is truly mindblowing and the world’s largest online community, with the population estimated to be 971 million just last year, continues to grow. According to Statista, that number will be 1.29 billion by 2026. The question of reaching those online consumers is a completely different story. Chinese social media sites have become very popular and innovative in doing so. 

What better way to see how than on the example of the biggest shopping day in the world - Singles Day - which is upon us. Even though the date is scheduled for 11 November, by now the preparations are, and should be, well on the way. 

Chinese market is a very lucrative one for international brands. Being a global shopping festival, Singles Day is a pivotal period for approaching digital-savvy consumers. But, joining the frenzy has its rules and, as an international merchant, you have to be very well prepared. Essentially, participating in Singles Day is a very systematic and comprehensive work.

Do your homework well

Entering a new market, especially as big as China, obviously has its rules. But it’s important to know that paint points for cross-border ecommerce can be bridged. Here are steps to be taken into consideration when planning your company’s strategy for Singles Day.

  • Time Schedule - Sign up on Alibaba in time to participate. Although singles' Day starts in November, the warm-up for the event usually starts in October, and the registration time is usually around August. 

  • Preparation of the process - Consider issues such as merchandise preparation, planning how to drive traffic, customer service preparation, logistics, product inventory, digital marketing, visuals, and KOLs schedules, livestream opportunities, budget, GWPs, etc.

  • Data driven - Data, computing power, and algorithms required to predict the styles, categories, and price ranges of products that different types of consumers would purchase are a must have.

  • Inventory & Logistics - Determine the goods likely to sell well and how many goods should be stocked in advance. Meanwhile, the supply chain must determine the layout required to achieve the optimal cost-performance ratio and then deploy goods to local warehouses, bringing them closer to customers.

Putting the customers needs first is a must 

The best testament to the effectiveness of Singles Day campaigns are the numbers. According to Statista, during November 1 to 11 of 2020, Chinese consumer spending on Alibaba’s ecommerce platforms amounted to USD 74.1 billion. You can imagine these are large volumes of sales.

Looking at the numbers it’s needless to say this can all lead to a big growth for a brand in China. So, it’s important to have things running smoothly. Have in mind that the whole process shouldn’t be affecting the customer experience. 

Therefore, it’s important to have a multi-channel engagement strategy. The ecommerce ecology in China is quite split, online consumers' daily shopping behaviour and screen hours become increasingly scattered – consumers are active on multiple platforms to search and buy products from different categories. Simply put, you need to adapt to that fragmented system and not rely on a single sales channel. Which is why you need to make a comprehensive digital marketing promotion plan before Singles Day. 

One important thing you need to factor in is that Chinese people increasingly depend on social media platforms as a place to share their opinions, ask for product advice and connect with others. According to consumer survey data released by Little Red Book, 75% of consumers make purchase decisions based on social media. On top of that, KOLs are a huge decision factor when it comes to shopping, and have a tremendous effect on increasing brand exposure and awareness. If you resort to the good old word of mouth, you can build that influence through KOLs. 

Knowing that over 80% of the Singles’ Day sales were made on a mobile device, it’s essential to enhance your mobile strategy. The logic is quite simple here, as nowadays retailers can reach customers faster and in a more convenient way. Live streaming, interactive games, VR shopping experiences, video marketing, etc. need to be incorporated in the communications strategy so they can add up to the whole shopping experience. 

Alongside logistics, live streaming is core to the event 

Video is a more immersive and entertaining brand experience. That translates to one simple fact - live streaming is converting browsers to buyers. 

According to Taobao Singles' Day 2020 data report, Taobao Livestreaming continued its rapid growth last year, with nearly 300 million users flocking to its livestreaming rooms. 33 Taobao ones have completed transactions of over yuan 100 million, and nearly 500 rooms have completed transactions of over yuan 10 million. At the same time Taobao Live's Gross Merchandise Volume increased by more than 100% and the number of merchants participating in the livestreaming increased by 220%.

On the other hand, KOLs are driving sales in big numbers too. Looking at Zhigua data, in just the first two days of last year’s Singles Day pre-sale period, Viya and Li Jiaqi, two of China’s most popular live streamers, managed to generate sales of yuan 4.8 billion (USD 719 million) and yuan 4.3 billion (USD 644 million) respectively. Viya had 149 million live stream viewers in total, while Li Jiaqi reached 162 million viewers within the first two days.

New shopping habits 

Alongside live streaming, ecommerce in China is setting up new habits for the consumers. It’s obvious to say that online shopping leads the way, and that is especially seen during the pandemic. We can take the example of fresh food categories as a proof. That leads us to the increase of 10.9% in China's online retail sales over the previous year, which translates to a profit of yuan 11,760.1 billion. 

Consumers are more concerned about the word-of-mouth recommendation between friends and family and the experience of consumption scenarios. Simply put, they use social apps more frequently to share their opinions, ask for product advice and connect with others. According to the China Internet Network Information Center (CNNIC), Chinese people spend an average of 2 hours and 12 minutes on social media platform.

This all changed shopping habits and gave rise to emerging categories, such as healthcare and beauty which were popular during COVID-19. Prolonged stay-at-home policies led to more time spent on cooking and housework which led to the boost of imported household, personal care, and cooking products. The beauty and personal care category is driven by consumers’ increasing awareness towards personal appearance and their pursuit for better quality of life.

Final thoughts 

The numbers, innovation and success of Singles Day is undisputable. The world’s largest online shopping event is the most important new product launch events of the year for many brands. At the same time it allows businesses to engage with consumers as well as provide a better consumer experience overall.

Brands need to keep learning and understanding the Chinese ecommerce trends and how their social media works. That will surely drive big growth. 

About Elena Gatti

Elena Gatti is Managing Director DACH at Azoya. She holds a bachelor’s degree in Telecommunication Engineering, University of Parma, and a Master’s degree in Computer Science & Communication Engineering, University of Duisburg. She has been working as a consultant at her Alma Mater, Accenture, and Macromedia GmbH before joining Azoya in 2015.

 

About Azoya

Established in 2013, Azoya is a borderless e-tailing group with headquarters in Shenzhen, China, that powers global retailers and brands with fully managed end-to-end ecommerce solutions and consulting services to help them expand to Asia. Over 220 young and talented employees around the world give retailers a truly global reach.


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Keywords: ecommerce, online shopping, data analytics, customer experience, social commerce
Categories: Payments & Commerce | Online Payments
Countries: China
This article is part of category

Payments & Commerce