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Back to the basics for 2022 Singles’ Day

China hopes to retain solid growth this year, largely on the back of consumer consumption growth. President Xi said the country would “better leverage the fundamental role of consumption in stimulating economic growth.” We’ve seen this with Beijing’s policies promoting sales of big ticket items such as cars and appliances. Though, perhaps the strongest single barometer of consumer sentiment are the results of Singles’ Day, otherwise known as Double-11.

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Herein lies the juxtaposition of this year’s Singles’ Day festival.Whilst most in the halls of Beijing want a strong Singles’ Day result, there are some conflicting signals which will dampen sales. Similar to  last year interspersed with Common Prosperity themes, the tech giants have tiered back the razzmatazz of the giant eCommerce festival so they’re not seen as promoting mindless consumption.

Likewise, we’ve seen the cancellation of some of the largest KOL sales generating machines, such as Viya and Xueli Cherie. Their pulling power will be missed this year – Viya sold USD 1.25 billion worth of goods in 14 hours as part of last year’s Singles ’Day festival. Last year’s festival’s top KOL, (Austin) Li Jiaqi, is likely to be a little more sheepish than he was setting last year’s 12 hour, USD 1.7 billion sales record, given he was only being allowed back on the screen last month, following a three-month forced hiatus after the tank ice cream incident. We’re also likely to see more virtual KOLs peddling products as more brands seek certainty from less scandal-inflicted influences. Virtual initiatives will become increasingly common with the evolution of Alibaba’s metaverse ambitions.

Yet, just as China’s tech giants have done so many times before, they will adapt to the ever-shifting “new normal” and give it their best shot at another growth year in the face of economic headwinds and consumer uncertainty around zero-Covid policies. We may not see as many of the x-factor surprises that we’ve seen in previous festivals, but this Singles’ Day looks to be getting back to the basics to get some sales on the ticker.

Just like  in 2021, presales start next Monday at 8pm. 14-years of Singles’ Days mean that the festival is less novel than it once was, with fewer consumers prepared to stay up to find a deal. The earlier start time will broaden the addressable market, including the 120 million-plus market of online elderly, who are among the least saturated online shoppers in China. In addition, there are a number of other initiatives to tempt the silver surfers to buy.

One of the most interesting hallmarks of Singles’ Day is all the new lines released and brands launched during the festival. This year will be no different. Ferrari are launching a new clothing line, and new brands are entering China in time for the festival such as plant-based infant formula and baby cereal brand, Else; Budapest-based fashion house Nanushka; and Swedish fashion brand Filippa K, to name a few.

A common complaint of recent Singles’ Day festivals was that discounts weren’t quite as alluring as the festivals of old. To address this, there are reports that discounts are expected to be deeper this year, which will hold particular appeal at a time when many consumers aren’t feeling as confident as they have previously.

The vitality  of logistics became abundantly clear following delivery delays over Covid, and an area JD was seen to have an advantage over less-centralized Alibaba platforms. Alibaba is pulling no punches with logistics, promoting home delivery and furthering its green logistics through its part-owned logistics company Cainiao. The company is hiring 100,000 temporary staff for the event as it promotes nearly 100,000 “Cainiao Post” pickup stations across the country.

Another big change from earlier Singles’ Days will be an erosion of Alibaba’s dominance of the festival. JD has been more aggressive in chasing growth, with a particular goal of doubling the number of new small and micro businesses participating, ambitiously aiming to increase their sales by 100 percent from last year.

Breaking from the traditional ecommerce platforms, Douyin and Kuaishou insist that they will be a force to be reckoned with this festival, and have set lofty growth targets. Both are launching in-app Malls to provide a more stable means for shopping on the platforms. In addition, they have promised a myriad  of opportunities for brands to expose their deals.

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Many pundits weren’t picking growth for Singles’ Day last year, and it still managed a respectable 8.5 percent on 2020. This year will be even tougher, particularly on the back of flat growth for 618. Regardless of whether sales grow, participating brands will still see a magnificent spike in sales over the festival, which is unlikely to be rivalled by any other sales period.

Source: China Skinny