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What does singles’ day 2019 say about the future of e-commerce in China?

The double-eleven shopping festival has gone far beyond just a holiday for single people. It has become this 24-hour snap-up festival with nearly a half billion participants. This year’s double-eleven sales were, once again, record breaking. Now let’s take a glance at the future of e-commerce in China through the single’s day 2019 frenzy.

Stats of 2019’s double-eleven shopping festival of e-commerce in China

According to Alizila, Alibaba’s in-house newsgroup, the Gross Merchandise Volume (GMV) Alibaba group has made during this year’s double-eleven shopping festival has reached a record high at 268.4 billion RMB. This incredible amount of sales embarrasses Black Friday and Cyber Monday in the United States. Over half a billion DAU and 0.2 million brands took part in the shopping festival within Alibaba across the globe, which made Singles’ Day a shopping festival that goes beyond the border of China. Apart from Alibaba, other Chinese e-commerce platforms have made a great sales as well. Jingdong’s total double-eleven sales number was about 131.3 billion RMB while Suning’s total value also surpasses 100 billion RMB. These numbers created during this year’s double-eleven shopping festival showcased China’s consumption power as well as the digital and technological capabilities of China’s tech companies like Alibaba.

Inside China: Local brands are getting more popular among Chinese consumers

Many local brands in China, such as Perfect Diary and Luolai, have been preparing for the double-eleven shopping festival in advance to seize the opportunity in China’s e-commerce market.

Perfect Diary （完美日记）: Innovation on personalization and co-branding

With an estimated value of 1 billion US dollars in its third round of IPO funding this year, Perfect Diary also became the first cosmetics brand whose sales broke 100 million and – Top selling makeup brand on Tmall during this year’s Singles’ Day. From November 1^st to November 10^th, the search volume of Perfect Diary on RED (小红书) increased by 326%.

These statistics of Perfect Diary tell a lot about the effectiveness of its marketing efforts. On October 8^th, Perfect Diary announced its co-branding marketing campaign with National Geographic themed “Beauty of China on your eyes” (#上眼中国美色#) on its WeChat official account to build hype for the brand ahead of Singles’ Day.

[Source: Tmall “Perfect Diary X National Geographic” successful campaign of double-eleven shopping festival in 2019]

By virtue of co-branding with National Geographic, an authoritative magazine that is well-known among Chinese consumers and adding Chinese elements to the marketing campaign, Perfect Diary successfully caught Chinese young consumers’ attention and improved its brand image in the sense of trust. Apart from collaborating with National Geographic on eyeshadow palettes, Perfect Diary has been partnering with celebrities and influencers on Weibo, Bilibili, and RED in order to attract millennials and Gen Z as well.

Luolai Group （罗莱家纺）: Integration of online and offline marketing

On November 2, Luolai Group made an offline marketing campaign on an apartment building in Beijing (See images below), which was eye-catching. At the same time, it launched an online campaign that encouraged people to post their bed sheets online with the hashtag “Luolai Double Eleven, See you on the bed tonight.” Participants who are lucky can get a free set of bedsheets from Luolai. With some influencers promoting the content, the campaign later went viral in a short notice on Chinese social media Weibo.

[Source: Weibo “罗莱超柔客栈” Loulai’s successful double-eleven campaign in 2019]

This marketing campaign of Luolai, with a bit taste of sexual innuendo and naughtiness, has created a social and sensational scenario that fits into both the brand image and the festival theme. Everyone needs to go to bed every day. Along with its catchy slogan, the campaign successfully caught one of those moments when the brand intersects with people’s day-to-day life, which largely increased its viral potential on social media.

[Source: Alizila “WATCH: L’Oréal Paris Uses Alibaba, 11.11 to Reach Chinese Consumers”]

Beyond China: Foreign brands topped the sales charts during Singles’ Day

Although local brands in China like Luolai have presented us some great cases of marketing campaigns, among near 0.2 million brands who participated in this year’s double-eleven shopping festival, the top-10 brands in terms of GMV are all foreign brands, including Apple, Bose, Gap, H&M, L’Oréal Paris, Lancôme, etc.

Keyword for Singles’ Day 2019: Innovation

“Digital technology reconstructed the foundation of commerce, making the impossible possible.”

Daniel Zhang, Alibaba Group Executive Chairman and CEO

Innovation is one of the main themes of this year’s double-eleven shopping festival. In fact, many brands have been taking an innovative approach to better targeting Chinese audience. For instance, according to Alizila, L’Oréal Paris topped the sales chart of Beauty brands during the festival in terms of GMV. L’Oréal Paris has been partnering with the Tmall Innovation Center to develop new cosmetics products that cater to the taste of Chinese consumers as well as marketing strategies that work more effectively on Chinese audience months before the double-eleven shopping festival. In order to reach more potential consumers, this year L’Oréal Paris also hired and trained KOLs to live stream throughout the double-eleven shopping festival this year collaborating with Tmall.

[Source: Taobao “L’Oréal Official Flagship Store”]

This kind of partnership between Chinese e-commerce platforms and brands has created more possibilities in terms of innovation in new product development and brand marketing within and beyond China. At the same time, as more experiments being conducted through collaborations between China and foreign brands, more personalized products tailored for Chinese consumers will be available in China’s e-commerce market.

Going Green: How Alibaba approaches sustainability during Singles’ Day

Behind the consumption frenzy

Apart from the new record of sales number during this year’s double-eleven shopping festival, the Number of Delivery orders has reached a new peak as well: In total, approximately 1.3 billion deliveries have been processed. Debates on the potential threats to the environment have been rising behind this consumption frenzy.

Alibaba on going green: Green Logistics and gamification

Alibaba seems to be well-prepared for dealing with concerns over environmental pollutions. Alibaba’s logistics arm Cainiao has built more than 40,000 all over the country for recycling packages, in hope of pushing this shopping festival to a more sustainable and greener direction.

Apart from practicing sustainability through its logistic system, Alibaba has been adopting the concept of gamification on its mobile payment platform Alipay in order to advocate the importance of sustainability as well as improve brand image. For instance, Alipay users can participate in the game “Ant Forrest” by earning points. The more frequently users engage in “green” activities such as using shared rides, the more points users can get. When points earned reach a certain number, Ali Financial will plant an actual tree in China.

Takeaways for foreign brands to expand business in China’s e-commerce market

In order to optimize sales in China’s e-commerce market on Singles’ Day, foreign brands need to keep up with the rapid digital transformation of the Chinese market as well as tailor its products and marketing strategies into something that grabs Chinese audience’s attention.

Furthermore, in order to set foot into China’s e-commerce market, foreign brands need to take a lot into consideration, such as the local policies and legal constraints in terms of cross-border transactions, different costs like entry fees for selling on a Chinese e-commerce platforms, Chinese consumers’ preferences, etc.

Chinese consumer preferences are changing, for example this year there is more concern with environmental sustainability. In order to compete with the increasingly strong domestic products, foreign brands can conduct consumer research to prepare for the 2020 double-eleven festival. To learn more about improving your brands digital strategy, contact our project team at dx@daxueconsulting.com

Author: Isabella Li

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