Cross-border Selling

Alibaba’s 2019 Singles Day: $38 Billion; 200,000 Brands; 78 Countries

In 24 hours on November 11, Alibaba’s Singles Day recorded USD $38.4 billion of gross merchandise sales. Two-hundred thousand brands participated, from 78 countries.

In 24 hours on November 11, Alibaba’s Singles Day recorded $38.4 billion of gross merchandise sales. Two-hundred thousand brands participated from 78 countries.

Alibaba’s Singles Day sales on November 11 totaled a record $38.4 billion or 268.4 billion yuan gross merchandise volume, an increase of 26 percent over 2018, according to the company. Gross merchandise volume — GMV — is total sales of merchandise through a particular marketplace over a certain time, excluding fees and commissions.

This year’s Singles Day included an entertainment extravaganza that preceded the shopping. It was streamed live from Shanghai on Youku, Alibaba’s video streaming platform. American singer Taylor Swift headlined the event. Sales started at midnight, and Alibaba reported selling $1 billion worth of goods in the first 68 seconds — $12 billion in the first hour.

Overall, an astonishing 90 percent of sales came from smartphones. Alibaba’s logistics partner Cainiao Network processed 1.3 billion delivery orders.

This year, more than 200,000 brands participated, including more than 22,000 brands from 78 countries. One million new products were launched. Alibaba encouraged brands to offer steep discounts on their products. The top-selling brands were Apple and Nike. Apparently trade tensions did not result in a consumer backlash against American companies, as some analysts predicted.

During the event, 299 brands surpassed $14.3 million each in gross merchandise volume. The top five countries selling to Chinese consumers via cross-border platforms were Japan, the United States, Korea, Australia, and Germany. As usual, electronics, fashion, and cosmetics and beauty items were best-sellers.

During the event, 299 brands surpassed $14.3 million each in gross merchandise volume.

For this year’s event, Alibaba made an effort to attract new customers from smaller cities and rural areas. In fiscal 2019, more than 70 percent of Alibaba’s new customers live in these areas. The biggest challenge for Alibaba remains the expansion of other domestic ecommerce merchants, most importantly and Pinduoduo, both of which have a substantial number of customers in rural areas. They both engaged earlier in November in events similar to Singles Day.

Alibaba’s Southeast Asia subsidiary Lazada offers Singles Day discounts in Singapore, Malaysia, Indonesia, Thailand, and Vietnam.

How Massive?

To put the sales figure in context, last year’s combined U.S. Black Friday and Cyber Monday sales for all merchants totaled $14.1 billion. Additionally, although Amazon does not report Prime Day revenue, research firm Statista estimated that Prime Day 2019 (48 hours) resulted in $7.2 billion in sales. For the entire third-quarter of 2019, Amazon’s sales were $70 billion, according to Statista’s estimates. This year’s Singles Day, again, garnered sales of $38.4 billion in 24 hours.

U.S. Holiday Shopping

Black Friday sales in the U.S. often run for five days — Thanksgiving Day through Cyber Monday. This detracts from the excitement around the Friday after Thanksgiving as shoppers can get the same deals one day before and three days afterward. By the time Cyber Monday comes around, many shoppers are too fatigued to shop or have already bought what they wanted.

In contrast, many of the companies that participate in Singles Day offer deals only during those 24 hours. They spend weeks leading up to the event creating buzz via live-stream promotions of new products. They also entice consumers to book pre-orders with the final sales consummated and accounted for on Singles Day.

Trade War

Alibaba is mostly immune to the effect of tariffs on exported goods to the U.S. because so much of its sales are domestic or to other countries in Southeast Asia. International wholesale and retail sales comprise only 10 percent of the company’s revenue.

Amazon derives 27 percent of its revenue from international sales, but it doesn’t break out sales to China-based consumers. Amazon’s international segment operates at a loss.

Marcia Kaplan
Marcia Kaplan
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