Countdown to Singles’ Day 2017, Part 4: Singles’ Day vs. US Shopping Holidays

Singles’ Day Overview: China’s Largest Online Shopping Event

Singles’ Day (November 11) is the most significant online shopping day in China. Alibaba created an annual shopping event—now officially known as the 11.11 Global Shopping Festival—in 2009, marketing special “double 11” deals to single people who wanted to treat themselves by buying things they desired. The online sales extravaganza has caught on with other e-commerce players in China, and JD.com launched its first Singles’ Day sales in 2010. In 2012, Alibaba trademarked several terms related to Singles’ Day.

This year, Singles’ Day sales are forecast to surpass last year’s $17.8 billion, given an unprecedented number of participating brands, significant offline retail offerings and Alibaba’s effort to expand the occasion from a one-day shopping event into a shopping season. This year, 140,000 brands, including more than 60,000 international brands, are participating in Singles’ Day, up from 100,000 last year. These brands will be able to showcase their products to more than half a billion Chinese consumers on Alibaba’s platforms.

Singles’ Day Outperforms US Shopping Holidays

Compared with all the major one-day shopping holidays in the US, Singles’ Day consistently outperforms in terms of online sales. The 11.11 shopping festival has exceeded Western shopping holidays such as Black Friday and Cyber Monday in sales each year since 2012, which was only three years after Alibaba first launched the shopping event. In 2016, Alibaba recorded $17.8 billion in online sales in 24 hours over Singles’ Day: that total was higher than the online sales generated in the US during the entire four-day shopping weekend stretching from Thanksgiving Day through Cyber Monday in 2016. The performance gap between Alibaba’s Singles’ Day and similar US shopping holidays is likely to widen even further this year.

The hype around Singles’ Day has also been on the rise. What started as an occasion for single people to celebrate their independence has evolved into one of the biggest gifting occasions in China, appealing to all consumers, whether they are single, married or in a relationship. In terms of growth, Alibaba’s Singles’ Day 2016 sales were up 32% from 2015.

Amazon’s Prime Day, an online shopping event that the company debuted in 2015, is the closest invention in the Western world to Alibaba’s 11.11 shopping festival. Amazon offers deals exclusively to Prime members on Prime Day, and we estimate that the event generated $1.0–$2.2 billion in sales in 2017. While Prime Day undoubtedly had a positive impact on Amazon’s fiscal third-quarter results this year, Prime Day sales were only a fraction of the $17.8 billion in sales that Alibaba saw on Singles’ Day last year.

Singles’ Day Extends from One Day into a Shopping Season, Similar to US Shopping Holidays

Similar to Black Friday in the West, the 11.11 shopping festival has extended well beyond a one-day event: this year, it will stretch over three weeks. Alibaba held a “See Now, Buy Now” fashion show on October 31 that kicked off the promotion season, and many retailers will offer presale deals days before November 11. Shoppers have been browsing deals and loading up their shopping carts in anticipation.

The 11.11 shopping festival falls between China’s Golden Week holiday (which ran October 1–7 this year) and Chinese New Year (which will fall in February in 2018), two of the largest shopping holidays in the country. The prolonged Singles’ Day sales season is an ideal occasion for brands to engage Chinese consumers during an otherwise slow retail period.

The extension of the Singles’ Day event is similar to what has been happening in the US, where the influence of one-day shopping holidays is diminishing as retailers adopt a season-long approach to marketing and promotions. At the same time, US shoppers are spreading out their holiday shopping over longer periods of time.

Singles’ Day Focuses on Entertainment Rather than Discounts

While Western shopping holidays such as Prime Day and Black Friday tend to focus on discounts, Alibaba takes an entertainment-centric approach to its 11.11 festival marketing and promotions in order to engage Chinese consumers. Shoppers can enjoy fashion shows, an 11.11 Gala celebration that will be broadcast live and interactive games associated with the shopping event. The company uses the shopping festival to create new opportunities for merchants to build their brands and engage with their customers. This will likely drive sales for Alibaba through customer engagement over the longer term.

An FGRT survey designed to gauge Chinese consumers’ attitudes and plans regarding Singles’ Day revealed that the 11.11 shopping holiday is no longer primarily about price, as most shoppers are now focused on quality.

By contrast, US shopping holidays tend to focus on discounts, and to generate less excitement for shoppers. In recent years, lines have been shorter on Black Friday and many retailers have reduced their store hours on Thanksgiving Day. This year, many stores will not be open on Thanksgiving Day at all. In addition, some US retailers seem be downplaying their own Black Friday and Cyber Monday promotions, using the terms “Thanksgiving Sale” and “Holiday Sale” to promote their discounts this year.