MAI knowledge

China’s Upcoming “Singles Day” Frenzy

October 26, 2017

For those who exist within the E-commerce space in China, there is no bigger event than Singles Day. During Singles Day 2016, China collectively spent around AUS$22.63bn online. This makes Singles Day the 10th largest e-commerce market in the world, almost being larger than the entire Australian market.[1] . Something to think about if you sell anything online to Australians.  

The day was originally started by Alibaba, for single people to buy themselves gifts to celebrate the fact that they are single, and it is held every year on the 11th of November (11/11). This date was chosen because the “1” representing a single person. It is especially popular amongst young people, but its success has made it a popular day for most across the country. 

Some may simply see the large market size of Singles Day as a by-product of China’s population, and while this is certainly a factor, the reality is a little more complex than that. There are fundamental reasons why E-commerce in China is different to what we see in the west.

There are over 700 million smartphone users in China, and e-commerce usage rates in Tier 1 and Tier 2 cities are sitting at around 88%.[2] The mobile experience in Chinese cities is more immersive than what we are used to. Digital wallets can be used everywhere to make purchasing more seamless and the shipping/delivery infrastructure means that same day delivery is almost an expectation for many located in cities.

The attitude towards online shopping is also very different. While in the West, online shopping can sometimes be seen as a chore, and a rather rudimentary experience, in China, it is seen almost like a sport, fun and entertaining, with a strong focus on the customer experience. Certain trends like “gamification” have helped solidify the engaging nature of the Chinese online shopping experience.

There is large opportunity for Australian companies to deliver their products to China on Singles day. Australian companies already have a competitive advantage, in that, in certain industries, their product has a positive brand perception simply because it is Australian. While we are lucky in this regard, you should not solely rely on this ‘clean and green’ brand to sell your product. Make no mistake, Chinese people still want a product to be of high quality, and if a product does not meet their standards, they will stop buying just as quick as they started to. There still needs to be a strong focus on maintaining product quality, companies who do this well have had good success in China.

For 2016 Singles Day, Chemist warehouse sold AUD$2m worth of stock in the first 13 minutes, securing itself as the top ranking overseas vendor for the past two years and the first international seller to reach AUD$25m in revenue in the 24 hours. An Australian company being the first to reach this achievement is a positive sign for other Australians looking to make the move to China. Others, like UGG Australia, Swisse, Blackmores and Jeanswest, were also able to do well in 2016.  

The amount spent on Singles day could be viewed as a market of its own. Being conscious of this, it would be wise for companies to tailor specific marketing promotions towards Singles Day, this will not only help build brand awareness, as more people are looking online to buy during this period, but it will also make people see your brand as one that truly understands China. We will be in China this year during Singles Day, and are excited to see what is “in store”.

[1]https://www.emarketer.com/public_media/docs/eMarketer_eTailWest2016_Worldwide_ECommerce_Report.pdf

[2] http://www.forbes.com/sites/sarahsu/2016/07/16/chinas-growing-e-commerce-addiction/#385180443b01

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