I have been aware and fascinated about Alibaba’s Singles Day (11.11) Sales success ever since it started in 2009. And it impresses me across every role that I have played in my professional life – retailer, marketer, consultant, digitalist and, most importantly, customer chair. I can easily say that I haven’t seen a global customer ‘festival’ with this massive quantum of ‘consumption impact’ yet. My annual observations of this marquee event have led me now to compile this multi-part series, in an attempt to capture elements on what goes into making this event really ‘click’ – the ecosystem, the partnerships, the preparations and the consumer connect. In the 1st part of the ‘Singles Day’ series, I outline contours of the ecosystem that works seamlessly to deliver a $38.4 billion sales bonanza in a span of 24 hours
Quick Highlights of 2019 Singles Day
Sales: $38.4 billion in Sales – covering everything from consumer electronics to luxury goods to automobiles (a rise of nearly 26% from the previous year)
Merchandise: Over 200,000 brands participated, including over 22,000 brands from 78 countries, and one million new products were launched
Ecosystem Span: 10+ million merchants and brands, tens of thousands of logistics companies, 3 million delivery people and 500000 trucks
Robust Technology Infrastructure – Insights from 2019
At its peak, their Apsara OS, Cloud Infrastructure and AI Technology supported a record 544,000 Orders/Second – using advanced data processing and analytic capabilities – with Zero downtime
Its cross-border e-commerce platform, AliExpress, was used 1.66 billion times during the festival with 200+ billion words translated in different languages – using a machine translation service
More than one million orders were placed and processed through voice command using smart speaker Tmall Genie (as voice shopping became a trend with Chinese shoppers)
Energy consumption at Alibaba’s data centre dropped 70 per cent from 2018, saving more than 200,000 kilowatt hours of energy using cooling technologies developed by Alibaba Cloud
Singles Day Preparations for 2020
Alibaba Singles Day is a culmination of months of planning, extensive cross-platform teamwork and intense forecasting. Let’s look at the majestic preparations and ecosystem alignment for 2020 edition:
New Partner Integration: 250000+ brands, 5 million SME businesses, new domestic businesses, foreign trade companies, factories and agricultural businesses will participate in 2020
Timeline Extension for Improved CX: Alibaba has announced in 2020 that the usual 24-hour sale will be upgraded to a bigger “shopping carnival” — a 6-week seasonal sale, starting October 1. This would allow shoppers to explore the best of Singles Day deals for a longer period of time, rather than the frenzied 24-hour timeline rush
Key Consumer Insight:Incorporating extra gifts in your listings has an extremely positive effect on conversion rates, leading to merchandise/marketing theme of creating ‘tens of millions of single products’ – referring to the extra bonus items customers receive when they order
Product Management Insights:
‘Super New Products’ campaign is available for products which are a) officially registered in China after 1 July 2020, b) have been launched on Tmall exclusively after 1 October 2020, and c)which meet minimum stock & inventory requirements
Exclusive Tens of Millions of Single Products: These items could simply be a smaller-volume equivalent of original product, or say, 5 miniature/fun-sized samples – available as bundles and packs
(Tmall) Merchandise and Order Alignment with Merchants and Brands:
Brands should target 20-30% of their annual sales to be fulfilled during this period
Merchants should lock down 65% sales in pre-orders (20 Oct – 10 Nov period)
Emerging Category: Men’s Personal Care – Sunscreen, Face Masks, Hand Creams, Perfumes, Highlighting Makeup, Mascara, Eyelash Extensions, Concealers, Eye Shadow
Inventory and Order Fulfillment Workflow:
Livestreaming Push: Merchants should target to sell at least 20% of their total volume via livestream promotions. At the very minimum, livestreams should account for at least 7-10% of overall sales. In other words, livestreaming is no longer optional
(Tmall) Promotions and Campaigns Sync: Leverage Alibaba-friendly social/digital platforms (to workaround possible hyperlink blocks between Tencent and Alibaba affiliated platforms) like Sina Weibo, Xiaohongshu (Little Red Book), Youku, or even Douyin
Go large on the off-platform promotions leveraging KOLs
Articles are great, videos are better, but there’s nothing better than live TV crossovers – particularly when celebrities are involved
Promote appealing to customers through their lifestyles – showcase how your product can seamlessly slide into their daily routine
For all off-platform initiatives as well, direct all traffic straight to the Tmall flagship store
Key conversion tools will include: Taobao Live (livestreaming platform), Featured (paid) Programmatic Content Spots, CPC/SEM tools, Marketing tools from Alimama suite
(Tmall) Promotion Themes: 3 key themes this year:
Emphasize the need to support those affected by the global pandemic. The title of their major promotion roughly translates to the ‘¥10 Billion in Subsidies’ promotion
Support the wounded travel and tourism industry. Nurture ‘revenge shopping’ amongst the would-be tourists of 2020. Duty-Free sales will feature tens of thousands of hand-picked, globally sourced products
‘Buy One Get N’ promotion promises to shower customers with 5+ miniature samples whenever they purchase a participating item
Operations and Logistics Focus: The key focus area for them is On-time deliveries (OTDs) of millions of parcels to over 800 million shoppers – with the help of Cainiao (its logistics arm)
Supply Chains have been upgraded and automated predictions are being put to use to shorten stocking time, improve inventory turnover, and throw out more targeted warehouse divisions, stock preparations, and replenishment proposals
New warehouse opened in Wuxi (East China) equipped with more than 700 robots that will be able to use automated driving technology to pick up a parcel and deliver it to another section of the warehouse where delivery agents can collect it
Enhancement to the accuracy and matching rate of supply chains, so as to help merchants better retain their inventories and get packages to consumers faster
Deploy new energy vehicles to 100 cities and apply AI algorithms to drive smart routing in 40,000 villages and shorten average length of delivery journeys by 30% in rural areas
Predictive Analytics: More than 80% of 2018’s and nearly 90% of 2019’s pre-loaded boxes successfully reflected actual purchases, and therefore could be shipped out on the same day without any alteration. This pursuit continues this year in all likelihood
In Conclusion
This is what Quy Huy has written in the Harvard Business Review article “For Alibaba, Singles Day is about more than Huge Sales” in 2019: The day has come to represent a unifying cultural event of unabashed retail therapy, coupons, lightning promotions, and gamified social media campaigns from retailers across the country. Their purpose and proposition sounds really compelling indeed
Like the post? Kindly encourage and energize ‘Outside In’ efforts by subscribing below. Let us know the kind of stuff you may want to read in depth. And, yes, help spread the good word…
References and Sources