China hosts the world’s largest e-commerce event with its annual November 11th, one-day online shopping blowout. This year, Alibaba, the largest Chinese online retailer, reached its target of $5 billion in sales via its online payment system, Alipay. This number is two and a half times the amount that the U.S.’s Cyber Monday raked in in 2012. Western brands like Nike, adidas, Procter & Gamble, also participated in the 11/11 sales activity. Western brands appreciate the increase of online shopping in China as it allows them to communicate with more customers in rural markets that are harder to reach with brick and mortar stores.
Alibaba began this promotion five years ago in conjunction with the unofficial Chinese holiday, Singles’ Day. On Singles’ Day, November 11th, Chinese men gather to lament or toast their single status. Now, Singles’ Day is a banner day for shoppers regardless of marital status. According to retail strategists, Chinese people love to shop, and if given the right reason and occasion, they will spend money. Chinese customers are bargain hunters and that is what drives the success of the 11/11 shopping craze.
The one-day shopping record set this year highlights the extreme growth of online commerce in China. China will soon exceed the United States as the largest online shopping market by spending $290 billion on online sites this year compared to $260 billion in the United States. This growth is expected to continue at an annual rate of 32% over the next two years.
1. What is Singles’ Day sponsored by Alibaba in China?
2. Why is it so successful?
SOURCE: Shanshan Wang and Eric Pfanner, New York Times, November 11, 2013