To say that change is the only constant is somewhat of a cliché, but this is what has come to define retail in 2016, particularly when it comes to peak. The past few years have seen disruption after disruption to the traditional peak shopping periods, driven by changes in consumer behaviour and, in response to this, the rise of new ‘mega’ shopping holidays.
This ‘pick your own peak’ mentality from some of the industry's biggest players has come to the fore in 2016. It kicked off in July with Amazon’s second ever Prime day, and was followed this month with Alibaba’s 11.11 extravaganza and the news that Amazon, Target and more would launch their Black Friday deals early this year, seeking to make November 1st the new Black Friday. (Internet Retailing, November 2016).
The race to be the first with discounts and deals has made peak trading period increasingly hard to predict, and where the likes of Amazon and Alibaba go, inevitably others follow. As we see the rise of these kind of artificially created mega peaks across the globe, with Asia’s Singles’ Day and Australia’s Click Frenzy to name but two, the headlines pour in - proclaiming the death of Black Friday, or touting a multi-billion dollar bonanza. But what’s the real impact on retailers? As we close the door on Singles’ Day for another year, and look forward to Black Friday next week, we’ve examined the numbers to see what retailers can learn beyond the hype. Here are the five staggering stats that you should pay attention to:
1. The $18bn opportunity
“This year’s event, which took place last Friday, saw consumers spend a record $18bn with Alibaba, an increase of 32% on last year. To put that into perspective, Amazon’s Prime Day event in July grew by 60% this year, and still estimated to have only taken around $2.5bn.” Graham Cooke, Qubit CEO and founder, originally featured in The Drum.
2. Visitors to UK and US retailers increased on 11.11
We saw traffic from visitors based in Asia increase by 46% versus the previous Friday. Visitors from this region were online and looking for Singles’ Day promotions, but did they find them? A few retailers have cottoned onto this opportunity, such as luxury disruptor Farfetch, who ran a Singles’ Day promotion in 2015 (Econsultancy, November 2015) and clearly saw enough success to take part again this year.
3. And they spent more than other visitors...
We also saw that there was an increase in conversions and average order values on Singles’ Day for visitors from Asia. Conversion rate increased by 61% and average order values increased by 41% versus the previous Friday.
4. Consumers had 111 (and more) reasons to engage with Singles’ Day
In a move to differentiate from Black Friday Alibaba has sought to ‘redefine the way shopping happens’ (BBC, November 2016). Part of this is a big focus on the experience, not just slashing prices. From augmented reality and VR to livestreaming and 111 celebrity appearances from stars such as David Beckham and Kobe Bryant, Alibaba are seeking to gain a competitive advantage by offering their customers experiences they just won’t get elsewhere.
5. Singles’ Day is going global
“Alibaba has huge international ambitions. As their CMO recently commented, 11.11 is ‘a lot of our long-term strategy for internationalisation and upgrade consumption. It is a lot to do with creating a platform for global brands.’ While the likes of Sainsbury’s, Burberry and Waitrose, sell to the burgeoning Chinese market via Alibaba’s web platform Tmall, there is clearly a huge opportunity for more UK retailers to get involved in this growing shopping peak.” Graham Cooke, Qubit CEO and founder, originally featured in The Drum.
The opportunity that China presents is backed up by our data, which shows that visitors from this region not only spent more with US and UK retailers on Singles’ day, but even the previous weekend saw average order values over 200% higher than visitors from other parts of the world. Key to taking advantage of this opportunity will be unlocking the true potential of customer data, to deliver personalised experiences that keep these visitors engaged. This is something Alibaba has put at the forefront of its strategy, even going so far as to define itself as a data company rather than a retailer (MIT Technology Review, November 2016)
If you found these stats interesting then hold tight for more as peak progresses! We’ll be analysing the impact of Black Friday and beyond. To make sure you don’t miss any of the updates you can sign up to receive them via email below:
Image Source: www.alibabagroup.com