How crazy is your category on Singles Day?

How crazy is your category on Singles Day?

Singles Day is less than one month away. Consumer brands across China are earnestly preparing for the event, aiming to break the sales record set last year, again, on Nov 11, 2019.  

How crazy should you set your sales target for that day, and for November? 

It depends… on your category.  

Also known as the “Double Eleven Day”, November 11 has become an e-commerce festival across China. It’s not just a shopping spree. It’s a shopping bacchanal. 

According to Adobe Analytics and Alibaba, in 2018, Alibaba’s one-company one-day sales, measured at ~$31b Gross Merchandise Volume, surpassed the ~$18b online sales in the US on Thanksgiving, Black Friday, and Cyber Monday combined. 

One can argue that the comparison of absolute numbers is not fair. Alibaba’s measure of GMV is not consistent with Adobe. Also, it’s hard to compare one company’s number to a country.  

Fine. Let’s make a fairer comparison between two companies using a relative metric: 

How significant is the one-day sales record relative to an average day for Amazon and Alibaba?

For Amazon, Prime Day sales took 36 hours. Let’s just call it one day. In 2018, Amazon’s full-year GMV was $277b, and Prime Day sales were $4.2b. That means the one-day sales were equivalent to 6 days of average sales.  

For Alibaba, the Singles Day 2018 sales were CNY 213.5b, and its fiscal year 2018 total GMV was CNY 5,727b. The one-day sales translate to 14 days of average sales. 

Therefore, at a factor of 14x, Singles Day is a crazier day than Prime Day at 6x. 

However, not all categories were equally crazy in 2018. Using Tmall monthly data, we ranked 26 categories by the “craziness” of their November monthly sales, which were largely driven by Singles Day. 

Across these 26 categories, the weighted average ratio of November sales as a % of 2018 total sales is 16%. This means that November is bringing two average months of sales. The category of “Makeup/Perfume/Beauty Tools” is right on the average line. Anything above the line is a little crazier; anything below the line is a little mellower.  

Now, before looking at the ranking chart, let’s take a guess: between the two categories in each pair, which one was crazier in 2018? 

  • Men’s apparel vs. Women’s apparel
  • Small appliances vs. Large appliances 
  • Coffee vs. Nutrition supplements 
  • Fresh meat and vegetable vs. Traditional nourishment
  • Essential oil vs. Makeup

Among the above pairs, the crazier ones were… Men’s apparel, Small appliances, Nutrition supplements, Traditional nourishments, and Essential oil.  

Do they make sense?

  • When necessity larger appliances break down, families usually cannot wait for November. 
  • Coffee and fresh produce are better enjoyed fresh, while Nutrition supplements can be stocked up in November with a longer shelf life.
  • Men’s apparels are often gifts from girlfriends, wives, sons or daughters.
  • How many men dare to order clothes online for the ladies in their families, who are frequently ordering outfits spontaneously for themselves?
  • Makeup and perfumes meet “must-have” social needs while the essential oil is more for discretionary self-indulgence. 

What do we see?

The more elastic and less perishable categories get a stronger kick on Singles day; the less elastic and more perishable categories respond softer. 

The full rank of 26 categories looks like this. 

This chart may suggest the true force of one-day sales festivals: a big bang reminder for consumers to stock up less perishable goods that are usually in the back of their minds. 

Merchants should have a realistic expectation of the effectiveness of Singles Day, Black Friday, or Prime Day events alike. If your category is less elastic and more perishable, don’t count on a too ambitious multiple on the big bang sales. Work on the normal days.  

Please contact us at zhangrong@yimian.com.cn for more insights on China’s e-commerce.

(Cover photo: a women’s apparel e-commerce ad at Shenzhen airport, July 2019.)

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