By CHENG Lu
This year’s Singles Day sales, the 15th edition of the all-but-compulsory national shopping fest, has been and gone.
The occasion evolved from a novelty invented by Alibaba into a hundred-billion-yuan shouting match and is now a run-of-the-mill tradition for a very special kind of shopper. Many of China’s real and potential consumers of highly bargain-sized price tickets are now simply bored or irritated by them.
Still, the annual sales are read by many as a barometer and trendsetter. Real relevance apart, the biggest product of Singles Day is data. The event provides a valuable opportunity for the data cherrypickers to do their stuff.
Hereunder follows the lessons of this year’s shopping sojourn.
What, no GMV again?
Just like last year, big e-commerce sites left gross GMV out of their end-of-the-night report on November 11. That’s probably not because the numbers are too stellar for the mere public to grasp. Alibaba chooses to talk instead about a vague and hard-to-enumerate concept, “quality of growth.”
Over 800 million people popped by Alibaba’s stores during the three-week sale. About 32 million of them are part of a membership program. Alibaba claims that both sales and web traffic maintained double-digit daily growth in the two weeks leading to November 11, which paints a pretty sorry picture for October.
The company reportedly has been debating whether to invest more in live streaming. Across Taobao and Tmall, the largest two sites, 58 channels exceeded 100 million yuan in sales. Most of them are owned by influencers. In all, 400 brands exceeded 100 million yuan in sales.
Playing to the crowd
JD.com is cagey about its GMV too, but the biggest change this year is a live-streaming channel, with no fees or commission. A total of 320 million people viewed it during the sale, but we’re not told how many actually bought something. The company organized some high-profile “clashes” with competitors on prices and engineered headlines early in the season, accusing Alibaba’s golden child Austin Li, of signing coercive contracts with brands that forbid them from offering lower prices elsewhere.
Three days into the sales, Pinduoduo pounced off an opportunity to boast of various “record highs,” the only problem being that almost all numbers are record highs every year. A deeply unimpressive 20 self-invented categories had doubled last year’s sales at the same stage. So much for the first three days. PDD hasn’t bothered to report on the other 11 days yet.
Among the social-media-turned e-commerce sites, Douyin claimed sales of 130 billion yuan and Xiaohongshu - an almost microscopic participant last year - quadrupled its number of buyers and sellers. Bilibili politely suggests that sales are up by 83 percent from an arbitrary point in time 83 percent ago.
Complex algorithms, or ‘is it cheaper?’
Platforms are used to confuse buyers, sellers and analysts alike by ranking sellers according to whatever metrics served the platform best: volumes, discounts, reviews, or an “algorithm” (opaque terminology that does not stand for explanation). This year, it’s price and price only, they say. So much for the quality drive.
Customers are believed to be more price-sensitive and less enthusiastic this year. And why wouldn’t they be when the best these retail giants (JD.com, Pinduoduo, Taobao, and Tmall) can come up with is “the lowest prices on the internet.”
Sellers improve their rankings by simply lowering prices. Sales don’t really matter at all, the platforms boast. An eyeliner though, is an eyeliner at any price.
It’s cheap at the top
Are the really big players, for whom price is very far from everything, not disillusioned and disenchanted by seeing their highly-priced, high-quality products 3,146 places below loss-leading cosmetics from small producers in distant rural villages?
A rice cooker on Taobao stayed at the top of search results simply by regularly tweaking its price. It’s really hard to see where all this “high quality” might come from.
Sellers, as usual, like it if they make money and don’t if they don’t. Some report thinning margins and even losses. Many worry about “a race to the bottom,” but most of the worriers are a long, long way from the top. Others, rice-cooker sellers, for example, imagine that an indecipherable number on their page will mean more bargaining power with suppliers, but only if that number is one.
Get down and stay down!
Having decided to get prices down, everyone, including JD.com and Tmall, pushed small, independent sellers. Perhaps because of their very nature, they are easier to push around and more disposable than the big beasts. There are plenty more where they came from. These sellers tend to offer affordable items too customers who don’t much care about brands.
Tmall says more small-to-medium-sized sellers participated in this year’s sales than ever before. JD.com reported a 50 percent increase in their numbers. To attract these sellers, platforms offer range of threats and incentives, which amount to little more than putting the sellers exactly where the platform wants them to be.
Waning influencers
On the first day of sales, Austin Li, by far the most famous live streamer, sold only half of what he did last year. His volume is still massive, grossing close to 10 billion yuan that day, but he too has become hypersensitive about GMV.
Channels run by influencer agencies, especially celebrity-backed ones, did reasonably well. Jiaoge Pengyou, founded by the serial entrepreneur LUO Yonghao who is known for his provocative style, reported 60 percent more sales than in October. Tutoring-school-turned-gourmet-food seller New Oriental sold 175 million yuan of goods on the first day.
