Double 11’s global presence

By Chen Qingqing Source:Global Times Published: 2017/10/29 17:23:39

E-commerce platforms face challenges in making China’s sales extravaganza an international event


An employee of an e-commerce firm in Lianyungang, East China's Jiangsu Province, packs goods for the upcoming Double 11 online shopping spree. Photo: IC


November 11, or dubbed as "Double 11," China's largest shopping festival, is just two weeks away, and both Chinese and foreign merchants on Chinese e-commerce platforms such as JD.com and Alibaba are now busy preparing for it. For them, however, it is not only a shopping event, but also an opportunity to expand the Chinese e-commerce ecosystem to the overseas market. While global awareness of the Double 11 festival has been rising in recent years, merchants face challenges in serving more people around the world.

As this year's Double 11 online sales spectacle approaches, Chinese retailers are not the only ones getting everything ready.

Considered by some as the world's biggest shopping festival, Bangkok-based Thai products supplier Chalerm Thai International (CTHAI) started to gear up for the event a month ahead in mid-October, an employee from the company told the Global Times.

"This is our third year [participating in] Double 11…and we are expecting to make at least 20 million Baht [$601,866] this year, with thousands of packages to be delivered as a result of the event," the employee said, who preferred not to be named.

The Double 11 shopping event, or November 11 Singles' Day, was declared by Alibaba Group Holding in 2009 to help merchants on its business-to-customer (B2C) marketplace Tmall promote their sales.

CTHAI sells various niche Thai products such as edible bird's nests and Durio zibethinus on different online channels such as Tmall Global, JD.com, vip.com and many others.

In preparation of the big day, the company has been overseeing sales promotions since October 19.

For example, it has been offering cheaper prices for presale items whereby customers can scan a QR code to retrieve coupons.

According to the employee, any promotion to build up traffic throughout the year is in preparation of Double 11.

"I believe the revenues generated have been growing steadily," he said, noting that Chinese e-commerce giants Alibaba and JD.com have stretched the company's investments in Thailand in recent years, introducing the conglomerates to the local people of Thailand and boosting global presence. 

Alibaba has ambitions to make Double 11 more than a shopping event just for Chinese consumers, but for consumers worldwide, too.

"This year's event is no longer a price war, and it's not only about one single e-commerce company, it's about the presence of [China's] online retail ecosystem on the global stage," Liu Dingding, a Beijing-based independent industry analyst, told the Global Times.

When Alibaba launched this year's festival on October 19, it was soon forecast by the retail giant that over 140,000 brands will participate this time around, offering promotions for over 15 million product listings.

"This year's shopping event will also become a combat training ground for enterprises around the world," Zhang Yong, CEO of Alibaba, was quoted as saying in a statement sent to the Global Times.

The comment reflects the Chinese e-commerce giant's global strategy of serving customers beyond China, with the shopping festival already making footprints in more than 200 countries and regions last year, Liu noted.

While brick-and-mortar stores such as Macy's and Costco prepare for this year's event, Tmall will, for the first time, bring over 100 brands into overseas markets, targeting more than 100 million consumers around the world. 

Increasing awareness

Wang Xing, manager at Shenzhen Geekbuy E-commerce Ltd based in South China's Guangdong Province, which operates some stores on Alibaba's global online retail business AliExpress, said he expects the daily revenues of some companies operating on the day of Double 11 to surpass the total revenues they generate in half a month. Some could even surpass their total monthly revenues on just that one day, he predicted.

"Our targeted market is Russia. We have been tapping into major Russian websites and other social media platforms, and have also planned to ship some of our products to overseas bonded warehouses in advance," he told the Global Times.

Currently, the overseas market most impacted by AliExpress is Russia, said Jack Chuang, partner at OC&C Strategy Consultants.

During the seven years that Wang has operated with AliExpress, he never once shifted his focus to foreign counterparts like Amazon, which marks similar sales promotion events, namely Prime Day and Black Friday.

Besides Russia, many stores have been targeting Southeast Asian markets since the beginning of this year. Xia Lei, brand operator at AliExpress, said his company has signed five Vietnamese brands recently and will launch them on the platform before Double 11 commences.

''Globalization'' has become the key word for Alibaba's Tmall business during the Double 11 event over the past two years, with the company now serving 500 million domestic customers while pushing to serve 2 billion users beyond China's borders in the future, according to the e-commerce giant.

However, Alibaba is still "sourcing global, selling China" as the reach and localization of AliExpress still hasn't resonated with global markets, Chuang noted.

"The reputation of Double 11 has become global, mainly because we see global companies prepare for the event, although it is still not a global event for overseas consumers," the analyst said.

Logistics limitations

For merchants, the upcoming shopping event is more like an annual exam rather than a promotional activity.

"It will test every aspect of our e-commerce business including our supply chain, IT system, logistics and so on," Wang the manager told the Global Times.

While more and more packages get set to ship to foreign countries, it will test local logistics conditions as well as transport capacity.

"In some countries, which lack in infrastructure and have inadequate express delivery services, users would only receive their packages ordered on Double 11 six months later, like what happened before in Brazil," said Zhou Zhiyong, a business operator at AliExpress.

Only partial shipping access has been arranged for deliveries outside of the Chinese mainland. Current offerings from Alibaba and JD.com are still focused on the mainland, although free shipping is available to Hong Kong and Taiwan, Chuang noted.

He also said that there are still some logistical and cost limitations and that it requires tremendous efforts to be cost efficient meeting high quality international delivery standards.

Also, merchants now face challenges such as rising protectionism and increased tariffs in the international e-commerce world, Wang noted.

"But we still hold an optimistic view on this event as well as its global development. As for now, there are 100 million buyers registered on AliExpress," he added.



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