What is the hottest talk among Chinese shoppers this month? It's the ‘Singles’ Day Promotion’ on November 11, also known as ‘Double Eleven’. Whether or not you are a bachelor, you are still invited.
You may not have heard of the Singles' Day Promotion, but it was initiated in 2009 by Alibaba on its Chinese B2C online shopping site ‘Taobao’ and quickly copied by rivals, soon after it became the biggest online shopping event in China and grew to a Global Shopping Festival last year.
Within the 24 hours of the singles’ day event, the sites of Tmall and Taobao saw sales of ¥91.2 billion (NZD $18 billion) by the end of the day. With a 60% increase from 2014, this growth is expected to continue.
This year, the one-day online promotion has been extended to 24 days. It is also being followed by brick-and-mortar retailers, who are featuring eye-catching promotions on appliances, clothing, cosmetics and even food. It seems everyone saw the tremendous business opportunity and wanted to have a finger in the pie.
Internet and globalisation has truly broken down borders and converted the globe into one large ‘village’. ‘Double eleven’ is obviously going global; Chinese consumers are able to buy an unprecedented mix of international brands and products from around the world.
China, with over 7 billion net-izens, exceeded the United States in becoming the world’s largest and fastest-growing online sales market in 2013, and became nearly 80 percent bigger than the US in 2015.
There’s no way to talk about China’s e-commerce without mentioning Alibaba. Its success story has continued since it boosted its Initial Public Offering (IPO) to a record $25 billion in New York in 2014. Although the e-commerce market in China is huge enough to allow competitors, such as JD.com and suning.com, Alibaba is undoubtedly the leader for online commerce in China.
You might think that the biggest challenge in doing business in China is the language, policy and culture, however, it is much more than how we ‘hold up the chopsticks’. Actually, understanding who the shoppers are and what’s driving these shoppers is incredibly important to success.
Online shoppers in China tend to be young, have a different attitude toward shopping than older generations and an increasing mature demand for quality and safety of products. We are no longer only looking for the lowest price, but rather good quality with a reasonable price and better shopping experience. Therefore, it is no surprise that this trend brings an enormous opportunity to New Zealand exporters.
Natural products are high on the priority list in China – five of the top-25 overseas products are named with ‘natural’ and ‘organic’. This includes: toothpaste made with traditional herbal medicine, beauty collagen drinks and products containing essential oils. The concept of ‘100% Pure New Zealand’ resonates high for Chinese shoppers.
Sharing knowledge and experiences with loved ones is key to Chinese culture. ‘Koubei’, translating to word of mouth is another element shoppers value when purchasing. We believe one word from the customers is worth far more than thousands from the seller. Online shoppers can always refer to other buyers’ comments for the product, and Alibaba allows you to share photos and reviews about the quality, customer service and even logistics.
This year’s ‘Double Eleven’ event will surely mark another milestone for all savvy e-tailers. The future is unknown, and obviously no one can accurately predict what will happen next, but e-commerce certainly represents a high-growth sector as part of the globalisation process. To shine in today’s Chinese e-commerce market, Kiwi manufacturers and retailers need to fully understand the shopping and consumption needs of the Chinese consumer, to engage with them effectively and find new growth opportunities.