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How Alibaba turned Singles Day into a billion dollar shopping event

 

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After starting its Singles Day shopping event in 2009 with just 27 participating merchants, Chinese ecommerce giant Alibaba is gearing up for its 2016 11.11 festival that will see total sales in the billions.

What is Singles Day?

Singles Day, held on 11 November each year, was originally started by a group of Chinese university students in the 1990s as an anti-Valentine’s Day to celebrate their singledom.

Alibaba co-opted the day seven years ago and began marketing it as the 11.11 Shopping Festival. It has since become the world’s largest global shopping event and last year generated approximately AUD$20 billion in sales, surpassing the US’s largest online shopping day, Cyber Monday, which generated about $4.2 billion in 2015.

While the 11.11 festival is centred around a 24-hour online sale on 11 November, this year the festivities will include over three weeks of promotional events, explained Alibaba group CEO Daniel Zhang.

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“The 11.11 Shopping Festival has become the global retail benchmark over the past seven years, and we have raised the bar again this year to redefine the retail experience for our consumers together with our merchants from around the world,” he said.

“From [20 October] through to 11 November, consumers will discover, explore, play, watch, comment, share, recommend and shop across our entire ecosystem with our merchants both online and offline. All of this will be combined with consumption.”

Buy globally, sell globally

A key focus of the 2016 11.11 festival is to take Alibaba one step closer to its 10-year goal of serving two billion customers and supporting 10 million small businesses, brands and retailers globally.

In a statement, the company said it will achieve this through a ‘buy globally, sell globally’ strategy. Alibaba is currently a gateway for retailers including Apple, Target, and Victoria’s Secret into China, and during 11.11 it will debut a pilot program to help merchants sell beyond its home country.

To do this, Alibaba is expanding its infrastructure to allow overseas customers purchase through its ecommerce site, Tmall. Hong Kong and Taiwan will be the first markets to trial this service, with orders delivered through Alibaba’s logistics arm Cainiao. More than 100 brands have joined the sell globally pilot for the 11.11 festival including Costco, Skechers and Australia’s own Chemist Warehouse.

According to Zhang, the program “enables merchants to run efficient, transparent and barrier-free businesses and to sell and deliver products worldwide.” The plan is to begin in Hong Kong and Taiwan before expanding to Southeast Asia and then globally.

Alibaba

The Tmall fashion show was streamed live.

 

Entertainment and engagement

Alibaba’s Tmall site, which commands 80 per cent of China’s online B2C market, kicked off the 11.11 festivities by hosting an eight-hour fashion show in Shanghai on 23 October. The ‘see now, buy now’ event featured 50 international brands including Burberry, Adidas, Gap and Paul Smith, and was streamed live with consumers able to pre-order items in real-time as they appeared on the catwalk.

The event gave international brands the chance to interact with sophisticated Chinese consumers who shop mainly via mobile devices. May Ng, vice president and general manager of e-commerce in Greater China for Gap, said the fashion show’s mix of online shopping, music and fashion gave brands a chance to connect with consumers in ways they otherwise couldn’t on their own.

Alibaba Group chief marketing officer Chris Tung agreed. “For big-name fashion brands across the globe, Tmall has become not only a distribution channel, but also a branding powerhouse as well as a global gathering place for lifestyle and fashion trends,” he explained.

The company is also testing a new virtual reality (VR) shopping experience, ‘Buy+’, during the 11.11 festival. Customers can purchase a cardboard headset online for 1 Yuan (about 20 cents), which will transport them to select international retail stores including Chemist Warehouse and American department store Macy’s. Using the headset, viewers can experience the entire shopping process from product selection to payment through virtual reality.

Confused? Check out this video to see Buy+ in action.


Online to offline

Although Alibaba is an ecommerce powerhouse, the company sees the future of commerce as an integrated, holistic experience both on and offline. To reflect this, consumers during 11.11 this year will be able to try products that are only for sale on Tmall in person at Chinese shopping mall Intime.

An augmented reality game similar to the extremely popular Pokémon Go will also combine the online and offline worlds, with consumers following Tmall’s cat mascot on an adventure to earn prizes. Participating brands include Shanghai Disneyland, KFC and Starbucks.

Countdown Gala

To get consumers excited for the 24-hour sale, Alibaba holds an annual 11.11 Countdown Gala Celebration on 10 November. Katy Perry will headline this year’s event, which will be held in Shenzhen and attended by celebrities including US basketball player Kobe Bryant and band OneRepublic. Hollywood producer David Hill will direct the production and audiences will be able to view it on a Chinese television station and China’s largest video-streaming site, the Alibaba Group’s Youku.com.

As the tech hub of China, Tung said Shenzhen was chosen because it “has always been at the forefront of China’s opening up to the world and represents the spirit of innovation and forward thinking.

“We want this spirit reflected in our annual 11.11 Global Shopping Festival as we take globalisation and innovation to the next level in this year’s event.”

This year’s gala has a lot to live up to after the inaugural 2015 event held in Beijing, which was watched by 100 million viewers. The four hour show featured appearances from James Bond actor Daniel Craig, American singer Adam Lambert, and a special video from Kevin Spacey as his House of Cards character Frank Underwood.

 

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