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It started off as a simple secular holiday in China — “Singles’ Day” was fashioned as sort of an “anti-Valentine’s Day,” celebrating single people. The date November 11 was chosen because in Chinese characters, “1” depicts “single person,” thus “11/11.” But it transformed into the biggest retail day in the history of the world in 2009, thanks to Alibaba (BABA - Free Report) founder Jack Ma.
Ma’s vision for a global shopping festival was an instant success, bringing billions in revenue to tens of thousands of retailers. It rose to $5.7 billion in 2013 (35.0 billion yuan) and has steadily, and steeply, climbed from there. In 2019, Singles’ Day set the all-time high mark: $38.3 billion. By comparison, this is more than 10 times what Amazon (AMZN - Free Report) brought in for its Prime Day 2020. Is it possible Singles Day might reach, or surpass, $40 billion this year?
Perhaps it might. After all, China’s economic rebound from the Covid-19 pandemic is among the most successful in the world: from -6.8% in Q1, the world’s second-largest economy posted +3.2% in Q2 and +4.9% in Q3. (These numbers all come from the Chinese government and are not independently verified.) China is the world’s largest e-commerce market, as well as the most populous country on earth. Even the remote version of the blowout celebration for Singles’ Day on Covid outbreak concerns is not expected to put a damper on retail activity today.
That said, courier strikes in China over the past year-plus have eroded Chinese consumers’ trust somewhat in the overall e-commerce process, and despite a huge workforce it is not unionized (couriers are most often blue-collar men looking for better employment opportunities). Delivery price wars have further complicated the process, and these issues were all noted prior to the pandemic outbreak. There are also regulatory concerns among Chinese tech companies currently, which are causing stocks in the space to tumble over the past couple sessions.
Nevertheless, Singles’ Day is now a worldwide phenomenon — a “Black Friday” event several times larger — and will be worth paying attention to. Gigantic e-tail numbers like these are worthy of further study, regarding the appetites of the Chinese consumer, the ability of companies participating from the world over (2600 new companies are reportedly entering the fray today) to meet demand, and for the perceived health of the Chinese economy as a whole.
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Retailers Likley to Gain from China Singles' Day
It started off as a simple secular holiday in China — “Singles’ Day” was fashioned as sort of an “anti-Valentine’s Day,” celebrating single people. The date November 11 was chosen because in Chinese characters, “1” depicts “single person,” thus “11/11.” But it transformed into the biggest retail day in the history of the world in 2009, thanks to Alibaba (BABA - Free Report) founder Jack Ma.
Ma’s vision for a global shopping festival was an instant success, bringing billions in revenue to tens of thousands of retailers. It rose to $5.7 billion in 2013 (35.0 billion yuan) and has steadily, and steeply, climbed from there. In 2019, Singles’ Day set the all-time high mark: $38.3 billion. By comparison, this is more than 10 times what Amazon (AMZN - Free Report) brought in for its Prime Day 2020. Is it possible Singles Day might reach, or surpass, $40 billion this year?
Perhaps it might. After all, China’s economic rebound from the Covid-19 pandemic is among the most successful in the world: from -6.8% in Q1, the world’s second-largest economy posted +3.2% in Q2 and +4.9% in Q3. (These numbers all come from the Chinese government and are not independently verified.) China is the world’s largest e-commerce market, as well as the most populous country on earth. Even the remote version of the blowout celebration for Singles’ Day on Covid outbreak concerns is not expected to put a damper on retail activity today.
That said, courier strikes in China over the past year-plus have eroded Chinese consumers’ trust somewhat in the overall e-commerce process, and despite a huge workforce it is not unionized (couriers are most often blue-collar men looking for better employment opportunities). Delivery price wars have further complicated the process, and these issues were all noted prior to the pandemic outbreak. There are also regulatory concerns among Chinese tech companies currently, which are causing stocks in the space to tumble over the past couple sessions.
Nevertheless, Singles’ Day is now a worldwide phenomenon — a “Black Friday” event several times larger — and will be worth paying attention to. Gigantic e-tail numbers like these are worthy of further study, regarding the appetites of the Chinese consumer, the ability of companies participating from the world over (2600 new companies are reportedly entering the fray today) to meet demand, and for the perceived health of the Chinese economy as a whole.