Alibaba’s annual e-commerce extravaganza is about to begin.
And as the Chinese retail giant has courted more brands to participate, retailers around the world are bracing for the biggest shopping event of the year.
Alibaba’s Singles Day debuted on Nov. 11, 2009, as a day for those people not in romantic relationships to celebrate themselves by shopping online. The 24-hour phenomenon trounces Amazon’s Prime Day. In fact, it is expected to generate more sales than the U.S. shopping holidays Black Friday and Cyber Monday and spending on Thanksgiving Day combined, according to Adobe Analytics.
Adobe, which checks the online transactions of 80 of the top 100 internet retailers in the U.S., has forecast the five-day stretch from Thanksgiving to Cyber Monday this year will bring in $29 billion in online sales. Alibaba’s Singles Day in 2018 did over $30 billion, and that number is expected to grow.
“Think of 11.11 as the Super Bowl for brands,” Jiang Fan, president of Alibaba’s Taobao and Tmall businesses, said in an interview with CNBC. “It’s an opportunity to pull out all the stops to wow Chinese consumers.”
Alibaba touts the event with over-the-top fashion shows and concerts. This year, American pop singer Taylor Swift will perform at the “Countdown Gala.”
The company says it has grown to more than 200,000 participating brands from 27 in 2009, and 60,000 in 2017.
The impressive sales figures and all-around commotion make the event one that more American companies are finding ways to participate in — even ones that don’t participate in Prime Day.
About 24% of U.S. retailers say they plan to run promotions for Singles Day, Adobe said, after conducting a poll of 402 U.S. retailers that do annual sales of more than $500,000. That will include deals on Alibaba’s platforms in China and on retailers’ U.S. websites. Former Snap exec Imran Khan’s new fashion website Verishop, for example, says it will be running a sitewide sale of 25% off.
Alibaba says participating global brands include Apple, Estee Lauder and even some younger start-ups such as sneaker maker Allbirds, which is using the event to highlight a new ad campaign on sustainability.
“Some of the most innovative marketing campaigns and new product launches are coming from U.S. brands this year,” Fan said. “I think all eyes are on us [and 11.11] each year to see what the future of retail looks like and how to best succeed in the China market.”
Trade tensions between the U.S. and China could hit American brands participating in Singles Day this year, however, a separate study by AlixPartners said.
Seventy-eight percent of people think their consumption of American brands during Singles Day will be impacted, while 70% say the trade war will impact their overall purchasing. AlixPartners surveyed 2,022 Chinese consumers about their intentions.
Factors behind that tepid sentiment include both the possibility that American goods will cost more than competing Chinese items, or that Chinese consumers will opt for items made outside the U.S. Still, companies should participate or risk falling behind on Chinese consumers’ radars, according to the firm.
“Businesses need to get in on the action if they’re not already selling during this event, as [Singles] Day participation has become a barometer of a brand’s presence in the market,” AlixPartners directors Jason Ong and Michael McCool said in their report. “Brands are frequently assessed by their success in this event, so they can’t afford to miss out on a substantial sales drive.”
AlixPartners’ study also predicted apparel, footwear and sporting goods to be best sellers this year, followed by beauty products and lifestyle electronics.
On Singles Day, ”[the] China consumption market is huge, and U.S. brands and retailers need to think about whether they want to expand into China — if they have products that have an edge over local or other foreign brands,” Charlie Poon, analyst at consulting group Coresight Research, said in an interview.
Alibaba’s shares have climbed more than 36% year to date. Its market cap has grown to roughly $487 billion.