The Chronicles of Alibaba Singles Day – Part 3
The trilogy of the Alibaba Singles Day Chronicles will be completed by Outside In with this 3rd part in the series. You can catch Part 1 here at:
and Part 2 here at:
This Part 3 edition covers elements on Singles Day focus on Luxury Brands, Concept Extension to other Geographies, Identifying the key takeaways and articulating the Alibaba Playbook for realizing the “11.11” potential for Brands. I am hopeful that it will be a good finale to this compelling journey of the Alibaba Singles Day Festival…
The 11.11 Evolution for Luxury Retail
Luxury brands are relative newcomers to the Alibaba Singles Day Shopping Festival, but they are making up for the lost time now, with tremendous growth rates. Luxury brands were earlier reluctant to the join these shopping festivals because they were seen as times for bargain hunting and thereby incompatible with the luxury category. However, luxury brands have now learned to evolve and get involved – while protecting their prestige and profit margins
Alibaba’s Luxury Pavilion – via a separate Tmall platform solely for luxury brands – was launched 3 years ago and now hosts more than 200 luxury brands there – who use this platform to announce new products or offer limited edition items – and thereby create a luxurious online experience
One of the first luxury products created for the Singles Day Sale was a Geurlain perfume in limited-edition packaging, which was launched in 2018. It was exclusively available at the moment and that is what made it special. It was very successful and high-priced
In 2019, Burberry deployed the fireworks theme at the heart of their Tmall promotions at their flagship store in London, to drive up excitement about limited edition products created for the festival
In 2020, L’Oreal did a takeover of the Eiffel Tower and Arc De Triomphe for the 11.11 festival developing a high-impact outdoor campaign in China and Armani Beauty wrapped trams in Milan in 11.11-themed branding
In 2020, Cartier offered a limited number of buyers on Tmall the opportunity to personalize a red jewellery box that their items came in, so people buying a gift could perhaps add their initials or special date to the packaging. It was all about exclusivity, personalization and customization of the products
Valentino linked its 11.11 promotion with content from live fashion shows and to celebrate the opening of its bricks and mortar flagship store in Beijing. It recreated the store in 3D allowing consumers all over China to experience it through the Valentino Tmall store. Online shoppers could ‘experience and browse’ a selection of Valentino Garavani Candystud bags, footwear and other leather goods. 2 limited-edition handbags and 4 types of sneakers were sold exclusively on the platform. This experience did not need VR-glasses but used a 360-degree store imagery. Check the store commercial and the virtual store journey at: https://www.alizila.com/valentino-merges-online-offline-tmall-virtual-shop/
None of these campaigns were about festival discount: the focus was on limited edition products and a luxury experience. Alibaba has announced recently that they are planning to retool their luxury platforms – including Tmall Luxury Pavilion and Luxury Soho in order to power high-end brands reinvigorate their growth and connect with China’s Gen Z Shoppers – which are likely to be 40% of luxury purchases, according to report by Bain & Company
Singles Day Concept Extension to Other Geographies
The brands behind China’s biggest shopping festival are now expanding beyond China and taking with them the idea of brand-built shopping festival
Lazada – Indonesia, Thailand, Vietnam, Philippines, Malaysia and Singapore
The 11.11 festival in Lazada markets have become a blockbuster event thanks to the growing awareness between partner brands and consumers. In 2019, the platform attracted nearly 10 million extra users during the 11.11 festival period and the number of sellers more than doubled from the previous year. 26 brands recorded sales of more than $1 million in the 24-hour period and more than 4000 sellers generated over $10000 in sales on the same day. More than 1.5 million items were shipped across all SE Asian countries via Lazada Warehouses – with the fastest delivery in 80 minutes in Malaysia
Lazada’s 11.11 event borrowed from Alibaba’s China learnings and went beyond discounts and shopping, by creating opportunities for consumers to engage with brands and be part of online-offline celebrations. “Lazada Super Shows” were held in 5 markets – Indonesia, Malaysia, Vietnam, Thailand and Philippines – featuring performances by local & international artists like Blackpink and Bunkface. Over 13 million viewers watched the show via the Lazada app and broadcast partners
Interactive games like “Slash It” enabled shoppers to recruit friends to help them reduce prices and “Shake It” allowed consumers to win vouchers and discount codes by shaking their mobile phones. 2020s Lazada 11.11 Shopping Festival featured Happy Bounce – in which consumers could their Kitty Avatar to Lazada coins and brand vouchers
Local SMEs were among the big winners of the 2019 11.11 festival on Lazada. For instance, Indonesia haircare brand Ellips generated 40 times its usual daily sales and Thai fashion brand Copper used livestreaming to increase sales by a factor of 100
On that note, let’s now spend some time articulating the (Alibaba) Singles Day Playbook for brands to succeed at the 11.11 Festival…
Realizing the Potential of 11.11 for Brands – The Alibaba Singles Day Playbook – Strategy over Tactics:
1+ million products are launched on the Singles Day festival on Alibaba’s platforms. Brands need commit early and be bold in their approach to the big day (or week). They need to mine sales and behavioural data to determine what to make, what to sell and how to promote it. They need to be fast and agile, and be able to course-correct as they go. They also need to be creative to go beyond discounts in order to tell the brand story and bring it to life
For brands to play the long game, here are some tips that – which can serve as handy Playbook:
Identify your Heroes: Brands must decide what the hero products will be and how to make them work the best. This might mean creating entirely new products based on data around consumer’s unmet needs or identifying key products that will drive sales – in addition to others that may not be central to sale, but will support the surge in demand
(Be) More Than Skin Deep: In 2019, L’Oreal Paris worked with Tmall Innovation Centre (TMIC) and co-created the L’Oreal Midnight Cream specifically for Chinese consumers – after just 59 days of development. 80% of the customers were new to the brand
Get a grip of Channel Management: The product strategy needs to be linked to a brand’s pricing and promotion strategy. They should plan a range of exclusives, collaborations and bundles that make them stand out against the competition. And, brands need to optimize their Storefronts on the platforms they are using; with dynamic content that helps convert interested shoppers into buyers. These are the places where the brands can tell their story, explain their products, showcase their benefits, promote their rewards and talk about their celebrity partners
Deploy Smart Marketing: Alibaba recommends 30-50% of annual GMV is allocated to marketing for 11.11. They also need to consider the value of investing it early and getting shoppers to add items to their baskets before a sale event actually begins, compared to saving it for a single-day splurge. There should be a balance between the investment made directly on the sales platform and supporting marketing efforts on owned properties and other media
Think Below the Line, Too: Paid search can be an important way of driving traffic, particularly in the lead up to the festival. Brands can optimize their listings on key sales platforms by using key search terms that are as broad as a category or as specific as a need state
Seeding an Idea: Games that incentivize purchase can be highly effective ways of marketing a brand. Ahead of last year’s 11.11 shopping festival, Japanese skincare brand Albion promoted its toning lotion with a specially created game on Alibaba’s platforms. Users worked on a farm to produce a key ingredient in the lotion, coix seeds, and won red packets of virtual money to be put towards purchases. In one week, they achieved over 250K new followers or members from the gaming campaign
Data-driven Creativity Pays Off:
Playing the Long Game:
Manage Experience guided by Data: Assortment, Pricing, Storefronts, Margins, Brand Story, Positioning
Getting the Basics Right: Product Decisions, Competitive Landscape, Consumer Preferences, Pricing, Packaging, Production Rate, Shipping, Delivery Times, Partnerships, IT Systems, Technology/Visualization Tools, Traffic Drivers
Planning Marketing Budgets: Online vs. Offline, On-Platform vs. Off-Platform, Banners, Paid Search, Livestreaming, KOLs, Events, Entertainment
Winning Sales before the Sale Even Begins: Brands can start promoting their festival specials several weeks in advance, targeting people who don’t want to risk missing out on the day, or who will be unable to take part in the festival itself. Around 2 months before the festival, a brand should establish its command centre to manage operations throughout the festival period, run by an interdepartmental team and supported by IT that can cope with huge volumes of data and traffic at once. Test, test and test once again so there are no shocks on sales day
The First-24 Hours is just the Beginning: Forward-thinking brands with long-term brand building in mind use this period to build loyalty and advocacy. This is CRM for the digital age. E.g. KFC’s 11.11 Campaign:
To summarize our Alibaba Singles Day series, let’s identify the 11 key takeaways from the (Alibaba) Singles Day Experience:
1. The Festival is now for Everyone
2. They’re Too Big to be Ignored
3. They’re Not All about Discounts
4. There’s Shopping and then There’s the Festival
5. Planning must be Perpetual
6. Data and Creativity are your Water and Oxygen
7. Festival might be for Chinese Consumers, but Foreign Brands can Celebrate
8. The Events are Huge, but Brands Don’t Have to Be
9. The Festival has Reach beyond China
10. Livestreaming and KOLs should be High on Brands’ Agenda
11. The Festival Promises to change the World – Yes, Really
In Conclusion
Joining in to the Alibaba Singles Day Sale is both – a No-brainer decision as well as a High-stakes Operation. If you don’t participate, you miss out. But, without proper planning, the 11.11 festival is a sure way of losing an awful lot of money – and brand equity – quickly. Planning in great is the only way to succeed at the 11.11 festival. Chinese shopping festivals – like 11.11 – are a state of mind and to get into that state of mind, brands must recognize that festival success does not rely on tactics: it is all about strategy
The following forces are at play behind the staggering success: new consumption patterns, new brands, emerging e-commerce shopping demographics and new shopping experiences. This event is not just about a day, but includes a significant pre-stage build-up, which is as important as the day itself. It is Not a time to sell out your old stock (say), but a time bring out the latest innovations and products
References and Sources:
1. WPP and Alibaba Group Report – Dates with Destiny
2. Valentino Virtual Store: https://marketingtochina.com/the-new-tmall-flagship-store-2-0-feature-3d-customer-shopping-experience-store/