Amidst a conservative economic backdrop, value-seeking shoppers in Asia are gearing up for Singles’ Day – a shopping holiday that originated in mainland China, but is now eagerly awaited across the region.
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A Bain & Company report found that 77 percent of shoppers are planning to either reduce their spending or maintain their current spending levels on Singles’ Day this year. A cautious approach by consumers is not surprising given the prevailing macroeconomic challenges, but it is worth noting that the significant growth and evolution of the shopping festival since its inception in 2009 has since inspired rival events in an increasingly crowded retail calendar.
China’s retail extravaganza makes its mark on Southeast Asia’s shopping calendar
A report by Criteo unveils Singles’ Day as the dominant shopping season for consumers across Southeast Asia. Singles’ Day in 2022 witnessed the most significant surge among other similar festivities in sales (+139 percent) within Southeast Asia, with Singapore, Malaysia, and Thailand experiencing the highest spikes among SEA countries, with increases of 192 percent, 214 percent, and 210 percent respectively.
In Singapore, for instance, a recent survey conducted by LoopMe found that over half of Boomers aged between 55 and 64 (71 percent) had been planning for the annual shopping event on 11/11 for several weeks or months in advance. In contrast, 34 percent of Gen Z and 26 percent of Gen X participants had advanced plans for Singles Day shopping. Similarly, 36 percent of millennials aged 25 to 34 and 34 percent of millennials aged 35 to 44 had prepared in advance for the day.
Interestingly, among Gen Z respondents, 19 percent said they would watch online sales during Singles Day, while 14 percent indicated a preference for in-store sales. These findings highlight the varying shopping preferences and behaviours across different age groups in various markets.
Value still top of mind
When surveyed about their primary motivation for spending during the festival, 45 percent of Singles’ Day shoppers in mainland China expressed that their main objective was to secure value for their purchases, said Bain.
A notable segment of respondents (35 percent) indicated that they were patiently awaiting better promotions to maximise the value of their purchases, and 18 percent plan to take advantage of bulk deals. An even larger portion (48 percent) said they could opt for more affordable brands, or switch to private label products.
“Interestingly, this level of caution is comparable to consumer sentiment last year where 76 percent of shoppers surveyed mentioned reducing or maintaining their Singles Day spend,” said James Yang, a partner in Bain & Company’s Hong Kong retail practice.
“There seems to be an element of structural slowdown about the event linked to its longevity and scale. This year’s survey dug deeper into general spending intentions beyond Singles’ Day, and 71 percent of respondents told us they would cut or maintain retail spending through 2023.”
In China, livestream e-commerce now a distinct category
The emergence of livestreaming, which typically consists of influencers promoting products in broadcasts that enable viewers to make purchases, was already evident during Singles’ Day last year. Chinese shoppers are increasingly open to innovative platforms that blend entertainment and retail – hence the current popularity of livestreaming e-commerce by platforms such as Douyin, the sister app of TikTok, as well as Kuaishou, a short video and livestreaming platform. These platforms have captured the attention of consumers, providing unique and engaging shopping experiences that go beyond traditional retail boundaries.
Retailers in China face heightened expectations for both value- and content-driven experiences. “A winning formula in China will combine everyday value with inspiration, amusement, or diversion,” said Melanie Sanders, head of Bain’s retail practice in Asia Pacific, based in Melbourne. “There is little doubt that the bar has been raised for both value- and content-led retailing in China and it is imperative that retailers respond rapidly.”
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Brands could benefit from launching campaigns earlier, thanks to early-bird shoppers
Seasonal sales are “a marathon, not a sprint,” says Criteo’s managing director, Enterprise, APAC, Taranjeet Singh.
During peak shopping periods, more than a third of respondents in Southeast Asia indicated that they start contemplating gifts early, while about a quarter had already made gift purchases as early as the second quarter of the year. This group of early bird shoppers presents a valuable opportunity for brands to tap into, necessitating an earlier start to campaigns, particularly for luxury brands and higher-priced items, to effectively engage with their target audience.