Hot Pot Blog — Hot Pot China

Alibaba & Double 11 in 2018: Beyond the numbers — HOT POT CHINA

Written by Jonathan Smith | Jan 11, 2018 12:00:00 AM

This November saw record sales of RMB 213.5 billion (approximately GBP 23.8 billion) from China’s Double 11 – a shopping festival that has become a major feature of the Chinese commercial and marketing calendar for domestic and international brands alike.

Much has been written regarding the mind-boggling total transaction value, however Hot Pot’s insight team in Shanghai have looked beyond to identify three key takeaways for brands looking to build understanding and maximize value from the 11.11 shopping festival.

Key Takeaways

  • Beyond the Day: A common misconception is that Double 11 takes place on a single day. The reality is that the festival begins with pre-sale and add-to-basket in late October and brands are increasingly choosing to extend their promotional offers beyond the 11th November. Given that the length of the festival continues to grow, brands must develop their strategic plan well in advance to capitalise and consider appropriate budget allocation and activations before, during and after 11th November. Typically any non 11.11 related sales will taper off sharply from mid October and this needs to be factored into quarterly sales forecasts.

  • Beyond the Discount: Tmall and the Double 11 festival have developed a reputation for heavy promotion and discounting. This year Hot Pot saw notable campaigns from brands, especially in the luxury sector, that provided consumers with an immersive and engaging experience to counteract this need to discount. Exclusive and limited-edition products hold huge appeal and were able to drive traffic and conversions demonstrating that brands can succeed online in China without purely discounting aggressively. Additionally Tmall’s increasing arsenal of gaming, voting, and user-generated content mechanisms can be leveraged to good effect and should be considered key elements of seasonal promotional plans.

  • Beyond Tmall: Platforms from across the Alibaba ecosystem are playing an increasingly important role in the festival. For example, Eleme (food & goods delivery services), Fliggy (travel & booking), Hema (O2O retail in fresh groceries), Xianyu (second hand marketplace) and Damai (ticketing platform) are all leveraging the increased 11.11 consumer interest to drive sales. Additionally, a new Tmall initiative introduced offline activations in 12 cities covering 100 high-performing retail districts areas and 180,000 offline stores. Users were able to use their Taobao and Tmall apps to scan 11.11 barcodes at physical retail locations to receive on-the-spot discounts and coupons.

  • Brands including L’Oreal, KIMISS and Beats were key participants looking to leverage the retail opportunity offered by the offline activations. As consumers increasingly look for a seamless brand experience online and offline it is vital that an integrated omni-channel strategy is implemented and this can now be factored in to festival-based planning.

(image credits: Alizila, Fortune. Retail Week)