Visit our new website:

4 Takeaways for Luxury Brands from China’s 2017 Singles Day Bonanza

  • Tue, 14 Nov 2017 21:40

China’s Singles Day, the one-day digital shopping frenzy on November 11, had another spectacular year. Major Chinese e-commerce players have delivered some mind-boggling sales figures. Alibaba Group broke its own record with a whopping $ 25 billion in sales, up from last year’s $ 20 billion. Its main rival also recorded a staggering $ 19 billion in sales.

The annual retail holiday, which started less than a decade ago, has quickly become the world’s largest online celebration of consumerism that attracts the attention of international brands and retailers like no other. Aside from the astonishing numbers, the festival has much to reveal about the state of Chinese society, ranging from online retail trends, technological developments, to consumer culture that luxury brands need to understand.

Below, Jing Daily presents four post-Singles Day reflections based on our research of sales data of major e-commerce companies, media coverage, and online reactions, aiming to offer readers a comprehensive and critical lens of the event and highlight what luxury brands should learn from this year’s success.

Alibaba Delivers a Live Presentation on “New Retail” Initiatives

It has been one year since Alibaba announced its “New Retail” business initiatives, which is a new retail strategy that attempts to fuse the online and brick-and-mortar sectors via the latest technology with the goal to create a seamless and interactive shopping experience for Chinese consumers. This year’s Singles Day just offered a real-time, detailed look into this retail vision and its effectiveness in boosting sales.

Ahead of the event, more than 1,000 participating brands worked closely with Alibaba to convert their physical locations into “smart stores” by incorporating technologies such as virtual fitting rooms, virtual guides, augmented-reality backed mirrors, etc. The ability to connect online to offline empowered brands to develop a more interactive and engaging relationship with Chinese consumers and helped them collect data on customer behaviors and preferences for the future use. Consumers also had a much more pleasant and entertaining shopping experience compared to traditional retail settings, making them more willing to spend. According to Alibaba, Uniqlo saw its omnichannel GMV increase greatly.

Alibaba’s “New Retail” model is highly relevant to the luxury industry though it has not been officially applied. In recent years, the role of brands’ offline stores has transformed rapidly along with the changing demand of Chinese luxury consumers who value the quality of in-store experience more than ever. Alibaba’s “New Retail” model provides luxury brands with a chance to offer a better omnichannel and entertaining experience to visitors. Its implementation during this year’s Singles Day allows them to better understand this strategy.

Luxury Brands Capitalize on Singles Day Buzz

Singles Day has long been a venue for foreign fashion brands to test the waters of the Chinese market. According to Alibaba, some of the top performing players over the past few years came from fashion categories. This trend has largely continued in 2017. The sports brand Nike, for instance, became the first label (in less than 60 seconds) whose sales reached one billion yuan. Nike’s impressive performance was consistent with the country’s rising interest in the athleisure fashion trend, which some industry observers projected is set to overtake luxury market by 2020.

This year’s event also saw China’s local fashion industry catch-up with foreign brands in terms of popularity and revenue growth. Alibaba’s data revealed that more than half of fashion brands, whose final sales exceeded one billion yuan, were domestic players. For example, Jiangyin-based Heilan Home became the most-purchased male apparel brand. The Chinese fashion brands most popular among female consumers were PEACEBIRD (from Ningbo), Ochirly (from Guangzhou), and Semir and Metersbonwe (both from Shanghai).

On the other hand, we continued to observe a lack of presence of luxury labels this year. It was a much-expected move, as the nature of the event requires all participating brands to lower their price points to spur consumption. This largely conflicts with the logic of luxury business. However, as the significance of the Singles Day continues to grow, an increasing number of luxury brands have decided to beef up their presence on the digital and social media front. Luxury brands like Dolce & Gabbana, Michael Kors, and Shiatzy Chen released well-planned social media campaigns to promote certain products. This represents a smart move for luxury players to take advantage of the Singles Day buzz and the “ready-to-shop” mentality of Chinese consumers.

Foreign Luxury E-tailers Tap the Selling Power of Fashion KOLs

However, luxury brands were not totally absent from this year’s sales thanks to a number of top-tier Chinese fashion bloggers like gogoboi and shiliupo, who sold discounted luxury goods on their WeChat mini-stores in collaboration with Western luxury e-commerce platforms like Farfetch, Reebonz, and Matchesfashion.

Both bloggers curated a selection of luxury products for their followers to purchase. In their promotional posts sent out to fans ahead of the event, the discount rate of their offerings went up to 60 percent. According to gogoboi’s WeChat post, his Singles Day sales event was warmly welcomed by fans, with all available offers being sold out in less than five minutes.

The launch of mini-programs by WeChat in January this year has driven many fashion bloggers to establish their own stores to speed up the process of converting followers to buyers. This year marks the first time for Chinese fashion KOLs, who are known for their massive selling power, to sell luxury goods directly on WeChat during Singles Day—a new trend that luxury brands in China should watch out for.

Chinese Consumers Voice Environmental Concerns

Not all Singles Day achievements were laudable. In 2015, Green Peace called the event an “environmental disaster” and urged consumers to stop participating in it as “it’s intensifying the worst aspects of consumerism; environmental damage, unnecessary spending, wasteful behavior, and dissatisfaction for shoppers.”

This year, an increasing number of Chinese consumers have started to realize that what comes after the stunning transaction volume is a vast amount of packages that are used to deliver their orders. Many of them criticized the environmental costs behind this extravagant event and discussed the issue openly on the country’s social media platforms like Weibo and WeChat.

The rising awareness of the environmental impact of their shopping behaviors represents a change in consumer psychology in China that luxury brands need to take note of. According to Mintel Group, the need to be living and buying green is one of the main consumer trends to be expected next year in China. The study shows that ethical brands are favored by almost 60 percent of survey respondents and purchasing environmentally-friendly products can make them feel happy.

The post 4 Takeaways for Luxury Brands from China’s 2017 Singles Day Bonanza appeared first on Jing Daily.

Jing Daily


Related Stories

Resilient Vikings have taken their cue from Zimmer
  • Wed, 17 Jan 2018 09:36

EDEN PRAIRIE, Minn. (AP) -- Mike Zimmer was already smiling more than usual, sporting a relaxed look of satisfaction rarely revealed in public ...

Court of first instance | Judge adjourns Sou’s trial pending appeal
  • Wed, 17 Jan 2018 09:29

Macau Daily Times feed The trial that puts lawmaker Sulu Sou and former president of the New Macau Association (ANM) Scott Chiang in the defendants’...

Bordesley Independent School boss banned from teaching
  • Wed, 17 Jan 2018 07:09

The school was criticised by inspectors over child safety and the quality of its education. BBC News - Family & Education

Flying from Auckland to Christchurch with Air New Zealand
  • Wed, 17 Jan 2018 01:23

Api Talemaitoga flies from Auckland to Christchurch — again — on Air New Zealand's flight NZ531. The Plane: Airbus A320 — the workhorse of t...

Atlantic Canada recovers from flooding, outages and evacuations after deluge
  • Tue, 16 Jan 2018 22:25

Some Atlantic Canadians are still dealing with the aftermath of a deluge that led to severe flooding, power outages and evacuations in some parts of t...

These nine companies banned from the world’s largest sovereign wealth fund for ethical reasons
  • Tue, 16 Jan 2018 22:08

Norway’s US$ 1 trillion sovereign wealth fund, the world’s largest, has excluded nine groups, including the UK’s military equipment...

Moscow's 2017 December was its 'darkest' on record
  • Tue, 16 Jan 2018 22:08

Russia's capital had no sunshine last month, and now Siberia is in a deep freeze. BBC News - World

Kering Kicks Puma to Shareholders to Focus on Luxury
  • Tue, 16 Jan 2018 21:30

The French conglomerate that owns Gucci and Alexander McQueen plans to divest itself of German sportswear brand Puma. Kering currently owns 86 percent...

Sharon Stone had 5 percent chance of living
  • Tue, 16 Jan 2018 18:30

… Characters Vesper Lynd: French actress-model Eva Green played an attractive agent Vesper … MI6. She also double crossed James ...

Seven bodies found in capsized wooden boat likely from North Korea
  • Tue, 16 Jan 2018 16:35

Police said Tuesday that seven bodies have been found in a capsized wooden boat washed ashore in Ishikawa Prefecture, as vessels believed to be from ....

Visitors to Cubbon Park can hire GPS-enabled cycles from Jan 26
  • Tue, 16 Jan 2018 16:35

You can soon rent a cycle and pedal your way to heritage destinations in and around Cubbon Park. The tourism department and the Namma Cycle Foundation...

News Categories