In the wake of another Singles day, or “double 11”, as it is often referred to, it is once again time to take the temperature of the Chinese consumer (no Covid pun intended.)
At the height of the Covid Crisis circa Jan-Feb many an article predicted the death of consumerism as we know it in China. Restrained consumption, Sustainability, Purpose–focused buying, were amongst concepts floated that were supposed to transform the Chinese shopping psyche (ok, fine, I wrote about it too…)
But it seems that not even a global pandemic could derail the Singles’ Day sales bonanza of 2020, as this year’s shopping festival once again smashed a number of records: Alibaba announced an eye watering $75.17 billion sales on T mall (vs. $38.4 billion in 2019), 2.32 Billion orders were made, 800 Million shoppers and 250,000 brands participated and 700+ flights were chartered by Alibaba’s logistics branch Cainiao to deliver goods to China. Not too far behind e-commerce giant JD.com scored $40.97 billion in sales.
Were these shoppers all buying hand sanitizer and wellness products? Clearly not. According to Jing Daily, the number of luxury brands taking part in Singles’ Day doubled this year rising to 200. British designers such as JW Anderson and Anya Hindmarch launched their official flagship stores on JD.com during the period, as did French house Chloé who quickly sold out of handbags during the festival. Luxury big boys Burberry, Rimowa, Hugo Boss, and Coach all performed strongly. Michael Kors sales broke $100 million, and Cartier sold a $28 million necklace during a livestream event on Taobao Live followed by some 800,000 people. The global luxury groups, Kering, LVMH, Richemont, and Swatch Group were all up 150 %.
So what was behind this big splurge? “Revenge spending” is a term much used in connection with post Covid buying. This is reinforced by a quickly recovering Chinese economy and the Government encouraging consumption as part of its new “dual circulation economy” policy. The rise of live streaming as a sales tool helps too as does the fact that since the lockdown even more of China’s huge population is trigger happy, mobile phone in hand, to make their next e-purchase.
But I also think culture explains a lot and that dominant culture needs to be weighed against any emerging trends. Last month, a Shanghai ‘Female Socialite WeChat Group’ was trending on Chinese social media (= 1.2 billion views on Weibo!!) after a blogger went undercover in the group and exposed their gag. For a 500rmb ($75) joining fee, members get to fake being rich. They share resources and split the costs of experiences which they can then post about. As such, the price for a room at the glamorous Bvlgari Hotel was shared amongst 40 women, each person paying 125 rmb ($18) just to go up, take a pic, and share their location on social media. In another example, a rental designer bag would be shared between four women, who’d wear it on a date with a prospective boyfriend.
Although this is an extreme example, it demonstrates the thirst for status in China’s society where values are, for better or worse, informed by high power distance, face-saving and group influence. So is nothing moving on ? Of course it is. Sustainability is getting to be a thing. According to C2 Global who surveyed 1,145 Chinese consumers in October 2020 to assess their outlook for Singles’ Day, 75% of respondents said that corporate sustainability practice should influence their purchase decisions. There were also attempts to go green by the E-commerce giants behind the festival. 80K recycling stations were put up across China, packaging tape was reduced, and biodegradable packaging introduced.
Maybe, one day, living and shopping with purpose will even become the new status symbol in China. But probably not by the next Single’s Day Sale.