The afterthoughts on 11.11 have lingered.
Every trendy businessman is sharing the media wrapup post about 11.11. Lots of number crunching and we are chewing the statistics in different flavors. Well, at least Alibaba and JD, the two largest power players in China e-commerce, are having a bit spat over who is the number 1 based on their own definitions.
JD claimed this year it was, in fact, two hours earlier than Alibaba reaching RMB100 billion sales benchmark on the Single Day.
Alibaba was sarcastic, “Well, JD is so good in math; you are counting your numbers since November 1st, adding up your 11 days’ sales record to get that number…”
JD refuted, nonetheless, “You can start to sell prepaid coupons used on 11.11, 20 days in advance, then include them as your “one day sale”, but we cannot do our sum-up for consecutive 11 days discount sales, what is your logic here?…”
Anyhow for math or for logic, according to official sales record released on 11.11 from both sides,
Alibaba still wins an upper hand at RMB168.2 billion (USD25.3 billion), while JD trails behind at RMB127.1 billion. The gap between the cat and dog fight seems to get closer.
In terms of the breakdown of total GMV by e-commerce platforms, Alibaba overwhelmingly dominates the others as always (even that 4% from Suning belongs to the Alibaba camp). No wonder scanty of vertical e-commerce players dare to show off their transcript of 11.11 performance. They were simply midgets in front of these two giants.
11.11 is a triumphant day to convince the whole world Alibaba is the king of e-commerce in China and beyond. So afterthoughts on 11.11 also stirred piles of analysis on Alibaba’s much hailed “New Retail” strategy and ecosystem, covering:
- Digital media & entertainment
- offline smart retail solution
- Retail and marketing analytics
- AI and other innovative technology initiatives
- O2O local services
- Affiliated logistics services
- Online payment
- Financial service provider
The analysis should go on. But it somehow all boils down to one impression: “too invincible to compete”. Though China is the largest retail market, Alibaba does not leave out much space for the upstart or the aspirant.
As consumers, we do not care much about the competitive landscape. This year online shopping frenzy generated 1.38 billion packages. It begs one stimulating question: “Are we truly getting the lowest price on 11.11?”
During the past 11.11 festivals, online shoppers just put the products into their shopping cart and wait for the price to fall on the day and make the payment. They might face “fake discount”, but the whole process is simple and easy.
This year, the game rules have changed and some consumers complained they were too confusing to follow. It was no longer mainly about direct price slash off. Alibaba was particularly promoting the prepaid coupon idea before 11.11. A typical sale runs like below:
Suppose a dress is priced at RMB500, the vendor defines:
- you should buy the prepaid coupon at RMB15 before 11.11, which can double its value to RMB30 on 11.11, so you get an RMB 30 reduction on the 11. 11 purchase
- if you are one of the earliest 4000 transactions of this dress, your prepaid RMB 15 coupon would triple its value to RMB45 on 11.11
- if you purchase the dress during a certain time period, let’s say between 9:00 AM to 10:00 AM on 11.11, you would get an RMB40 cash back
- If your total purchase in our store exceeds RMB599 on 11. 11, you would receive additional RMB60 voucher
This means for consumers to get maximum discount, they would need to understand these rules and abide them strictly. Obviously a tedious and time-consuming process.
Underneath all these eye-dazzling styles of the coupon, voucher, red envelope etc, the ultimate goal is motivating consumers to end up buying more or buying something unnecessary. Local experts revealed that the rules are statistically designed by Alibaba and can be pushed to shoppers personalized on category, location, timing, demographics etc. Some vendors said homogeneous price cutting did not bring in much traffic, but by partnering with Alibaba in adopting these complicated rules, they were able to see traffic rise. Alibaba deployed AI technology to analyze customer data such as shopped items, browsed items and time spent on the site to constantly create new, personalized promotional pages throughout the 24-hour period.
We probably have a lot to ruminate about this year 11.11. or imagine next year. But above should be enough for the moment.
Author: Cecilia Wu