$24 Billion In 24 Hours? What To Expect From Alibaba’s Singles’ Day 2017

Many Australian retailers prefer to take control of their marketing operations by developing their own Chinese website, which enables them to target niche customers and differentiate through quality and service

by Azoya

It’s estimated Amazon’s Prime Day generated $1 billion revenue this year. The question now is, can Jack Ma’s ecommerce giant do that every hour for 24 hours?

Now in its 9th year, Singles’ Day, also known as “Double 11”, is already the world’s largest online shopping event and it’s set to get even bigger in 2017.

In 2016 Alibaba’s ecommerce platforms processed US$17.8 billion of gross merchendise volume. (In comparison, Cyber Monday is expected to generate US$6.6 billion in online sales later this month.)

“Prediction: Jack Ma’s Tmall will come close to hitting $1 billion an hour in sales, making Alibaba the biggest retail machine in the world,”

If that prediction comes true, the value of Alibaba’s 24-hour sale put it ahead of the Australia’s annual ecommerce sales figure. At last count NAB’s Online Retail Sales Index showed Australian consumers have spent around AU$23.28 billion over the 12 months to August 2017 — the equivalent to 7.5 per cent of spending at traditional bricks and mortar retailers.

How achievable is it? Well, last year Singles Day grew by 32 per cent and this financial year Alibaba has posted massive growth figures. In its recent quarterly results released last week, revenue from its core commerce operations increased 63 per cent year-over-year to US$7 billion. Which-50 will have the final sales figures on Monday.

That predicted growth is good news for 1300 Australian sellers on Alibaba’s Tmall platform.

In 2016 Australia was the fourth highest selling country during Alibaba’s 11.11 Global Shopping Festival. Australian businesses typically do well in categories such as such as baby and maternity products, health and nutrition, cosmetics, and food and beverage, which are all well sought-after by Chinese consumers.

This year new product categories on-the-rise from Australia include oats and cereal, beef, dairy, all natural skincare and active-wear. All of which will be available online Australia Pavilion which offers Chinese consumers a one-stop shop for popular Australian products.

As Lavin points out, for merchants “11.11 no longer augments your China strategy; it is your China strategy.”

Key Figures 

  • 140,000 brands (including 60,000 international brands) are expected to participate in Singles’ Day

  • 15 million product listings

  • Half a billion Chinese consumers will visit Alibaba’s platforms

  • 3 million logistics personnel will be on hand to process millions of packages during the sale

Singles’ Day Spectacle 

This is the third year Alibaba is hosting its countdown gala which is live streamed in the lead-up to midnight and the start of the Singles’ Day sale.

Celebrities like Pharrell Williams, Jessie J, Maria Sharapova and Real Madrid icon Luis Figo will attend this year’s 11.11 Countdown Gala Celebration, which is being produced by television producer David Hill.

The “Chinese-style variety show” aims to both entertain and get shoppers using their smartphones ahead of the sale.

“If you analyse why we are doing the show, it’s to turn shopping into sport and to make shopping into entertainment, so the show has got to reflect that philosophy. And the way the show is constructed—with so many segments, so many stars and fun bits—it reflects the overreaching theme of what Single’s Day has become,” Hill said.

The Other Players 

Alibaba’s ecommerce rival JD.com will also be active this Singles’ Day, as will smaller players looking to cash in on the day.

“Alibaba and JD.com are undeniably the most significant players in China’s ecommerce sector, but their marketplaces are crowded. This tends to lead to extreme price matching activities over the holiday period that can hurt small to medium-sized companies,” said Sylvia Wei, deputy managing director of Australia for Azoya.

Azoya offers white label ecommerce infrastructure for retailers, like Amcal, enter China, providing an alternative to the marketplace giants.

“Alibaba and JD.com, two of China’s largest online shopping sites, will monopolise TV and web advertising, plus prices are prohibitively expensive at that time of year,”  Wei said.

“Many Australian retailers prefer to take control of their marketing operations by developing their own Chinese website, which enables them to target niche customers and differentiate through quality and service.”

Holiday Sales

Customers Come First 2018

The ‘Customers Come First 2018’ report from AzoyaLab covers essential data about the Chinese cross-border shoppers - where they from, when they shop, how they make cross-border purchase