That's (retail) entertainment - the rise of China's Singles Day

What started as a modest marketing event with just 27 participating merchants, has become one of the world's biggest sales events in just nine years. This is Singles Day of course, invented by Chinese online giant Alibaba and since renamed “Global Shopping Festival“, which broke all records this year for Alibaba with a gross merchandise volume of 25.38 billion US dollars.

This year, 140,000 brands and merchants participated in the 24-hour shopping frenzy; as many as never before, and 60,000 of them were international ones. How could a newly invented commercial holiday become so far-reaching and a global phenomenon that is even bigger than Black Friday and Cyber Monday together, that too in less than ten years? FashionUnited has retraced the most important developments.

Anti-Valentine's Day becomes worldwide biggest commercial success

The inofficial holiday has been celebrated in China since the early '90s when students started using it as kind of alternative Valentine's Day, celebrating (or changing) their single status in karaoke bars and restaurants. Gift giving was involved as well. Those establishments soon realised the day's commercial potential and started supporting it, helped by China's online explosion and its burgeoning, upwardly mobile middle class, which had more disposable income than previous generations.

In addition, consumers were being bombarded with advertising that was getting increasingly sophisticated and lured shoppers with discounts that were increasingly hard to resist. Alibaba recognised the enormous commercial potential of the inofficial holiday and turned it into a shopping event that was boosted on its platforms Taobao and Tmall.

E-commerce and m-commerce carried Singles Day

In a culture that values exchanging gifts, especially with friends, family and colleagues, Singles Day and Alibaba's platforms lured Chinese consumers into buying gifts for themselves. This strategy proved so successful for Alibaba that soon, other online retailers joined in, thus supporting Singles Day. Because of the deep discounts, many singles started waiting for 11th November to buy their annual supply of durable goods like creams, toothpaste and soap. This aided Alibaba's success and contributed to the online giant achieving a gross merchandise value of 5.8 billion US dollars already in 2013, only four years after starting the commercial holiday. Last year, Alibaba sold three times as much, achieving 17,8 billion US dollars.

Another reason why Chinese consumers have been receptible for Singles Day is that they had been used to other holidays being turned into commercial events, for example Chinese New Year in the spring and the national holiday on 1st October (comparable to Christmas, Easter, Thanksgiving and Halloween in the West), which have been turned into „golden weeks“ - week-long commercial festivals for traditional and online retailers. Thus, the concept of Singles Day fell on fertile ground and as its slogan „Happy double 11“ shows, is celebrated more like a (virtual) holiday than a mere shopping event.

Another factor that fueled Singles Day growth is the e-commerce boom, which allowed Chinese consumers outside of big cities and away from malls, shops and good infrastructure to take part as well. This is true for the population in highly congested areas as well: People prefer to shop from the comfort of their own homes rather than braving traffic and pollution. Many of them did not even invest in a computer but shopped via their smartphones directly - a trend that persists till today: 90 percent of all transactions were made via mobile phones during this year's Singles Day.

Singles Day sales are going up, up, up

There is also an advantage that Chinese consumers had from the start: Participating online retailers realised the importance of their platform being as easy to navigate and customer friendly as possible, so that from the beginning, they invested in a functional shopping environment that appealed to their target group and enabled them to reach international brands as well.

In view of the fact that China's middle class will reach more than 300 million people in the next ten years - more than anywhere in the world, except India - the online shopping trend will increase, as will Singles Day sales. And this is an attractive proposition for international brands and retailers who want to reach such a large audience. The numbers reflect this interest: While in 2009, just 27 Chinese merchants took part in Singles Day via Alibaba's platforms, in 2015 there were 5,000 international brands from 25 countries alone; a number that increased twelve-fold in 2017 to 60,000.

Photos: Alibaba Group