Will ‘Singles Day’ become the new Black Friday for British Retailers?
Every year, UK retailers and ecommerce providers brace themselves for the annual Black Friday frenzy which continues to grow each year. In 2017, Black Friday pulled in a whopping £1.4bn in online sales alone – up 11.6% on 2016. While this may be one of the biggest shopping dates of the year for UK retailers, a force emerging from the Chinese retail market is laughing in the face of Black Friday.
Singles Day, as it’s known, takes place on the 11th November every year and started as an obscure “anti-Valentine’s” celebration for single people in China back in the 1990s. It was then adopted by e-commerce giant Alibaba (China’s equivalent of Amazon) in 2009 and has since grown to become a day when everyone, regardless of their single status, buys themselves gifts.
Alibaba chiefs spotted the commercial opportunity in Singles Day back in 2009 and began launching ‘Double 11’ deals just as online shopping was starting to explode. It was also seen as a chance to boost sales in the lull between China’s Golden Week national holiday in October and the Christmas season.
To put Singles Day into perspective, we’ve crunched some seriously mammoth numbers. In 2015, Chinese consumers treated themselves to almost £11.4bn worth of goods from Alibaba in just 24 hours. This year, Alibaba surpassed that total within 15 hours spending an eyewatering £24bn in 24 hours. The day saw a record-breaking number of orders this year. Cainiao Network alone processed more than 1 billion delivery orders on the shopping day, which, to put it in context, is equivalent to the volume of delivery orders processed in the UK over 4 months!!
But shoppers aren’t just handing over their money, Singles Day is also the biggest data collection event of the year. Take Taobao for example, it’s one of Alibaba’s most popular shopping apps and it monitors, not just what you buy but what pages you view, what you bookmark and uses artificial intelligence to predict what you’re most likely to purchase. Alibaba says they do this to tailor its recommendations to its consumers, so they receive a better shopping experience. Of course, this is nothing new for e-commerce brands, Amazon have also been collecting customer data for years in the UK, but when it comes to Alibaba – the data collected is on a completely different scale. Over 600 million people are using Alibaba’s Chinese retail sites and apps and millions more are using their other businesses like financial services and entertainment sites. All these customers are creating a ginormous mountain of data, which Alibaba then shares with its partner companies, so they too can better market their products to consumers.
But the sheer amount of data, and any accompanying privacy concerns doesn’t seem to put buyers off. In fact, global audiences watching the world’s biggest retail event unfold, are actually feeling like their missing out, but that’s not the case for some UK retailers who are well and truly in the mix.
The sheer scale of the market combined with the acute Chinese appetite for British goods, has opened up a significant new sales avenue for British brands. Sainsbury’s, Marks & Spencer, Asos, Waitrose, Dyson and Whittards of Chelsea already have marketplaces on Alibaba’s Tmall site. By using e-commerce as a way to enter the market, these British brands are adopting a relatively low-risk approach which is enabling them to better understand the appetite of Chinese consumers as well as giving them the chance to learn how to operate in China without substantial investment in opening stores. Sainsbury’s has used a virtual reality promotion tool on Tmall which allows shoppers to see a 360 degree live broadcast of a London supermarket as they shopped. The event was the second most popular promotion since Sainsbury’s live broadcasted an afternoon tea party on the Queen’s birthday. The pickings could be rich for British retailers going forward. Singles Day is much bigger than Black Friday and Cyber Monday combined and thanks to the growth in technology and the accessibility of being able to shop online from the comfort of your own home, Chinese consumers are desperate to access more British brands online. But perhaps the burning question is, will Singles Day hit the UK retail market?
The adoption of Singles Day in the UK could face some challenges. First off, the date is an issue. 11/11 is Armistice Day in the UK, a poignant day of remembrance and respect – certainly not a day to obsess over a discounted kettle or a pair of socks. But while the date may stall its entry to the UK, it probably won’t be the case forever. As online retail allows consumers access to millions of products from thousands of manufacturers, it seems impossible to envisage that Single’s Day will not extend its reach, in some form, to Western consumers in the near future.