The world’s biggest e-com event just got even bigger. Since Alibaba started offering Singles Day discounts in 2009, sales have grown steadily every year. Last year, sales on Alibaba’s C2C marketplace Taobao and B2C mall Tmall reached 40 billion dollars. With Tmall having over half a billion users and with the pandemic in the rearview mirror, analytics predicted that China would make up for any lost revenue due to Corona, and that last year’s sales record would be broken by at least 20%.
And it was. Alibaba’s sales surpassed 74 billion dollars, which means they nearly doubled the previous record. According to Alibaba, “strong early numbers indicate that demand in China is bouncing back after the Coronavirus”. It definitely seems that way.
It’s no coincidence that Singles Day always falls on the 11th of November. This huge Chinese e-commerce event takes place on 11/11 simply because “1” symbolises a single person. The day was originally created to celebrate everyone who is not in a relationship, but it obviously benefits anyone who’s looking for a bargain – regardless of whether you have a partner or not.
Although Singles Day is not actually a recognised public holiday, this e-com bonanza is quite a big deal. And – the Chinese people truly make the most of this day and it’s not unusual to save most of the year’s purchases for this occasion. This isn’t only because of the reduced prices, but also because of how easy it is to shop online in China. Same-day delivery has been around for a while and they can provide excellent logistics solutions for not much money.
Singles Day and Black Friday: Retrospect and planning ahead
Not all companies in the Nordics have jumped on the bandwagon of Singles Day yet. However, if you have and are also planning on making Black Friday a successful day for your business – make sure you evaluate and prepare properly. What do you think went well? What can you improve?
With Black Friday only a few days away you have a chance to determine whether you have the capacity to make the necessary improvements. If the list of improvement measures is long – prioritise the most critical points.
Evaluating Singles Day and Preparing for Black Friday – two main areas
1. Goals and KPIs
- Discount – do or don’t
What are you getting out of selling products with reduced prices? Is it part of a larger strategy or is it something you do because many other companies do it? Remember to carefully consider the risks associated with joining the discount party. It could have a negative effect on your company’s liquidity and customer trust. Do you want everyone to wait for Black Friday before they shop? Or is this a way to sell to customers that are and will always be deal-hunters?
“Remember to carefully consider the risks associated with joining the discount party. It could have a negative effect on your company’s liquidity and customer trust.”
- Brand building
One reason to do Black Friday could be brand building – using part of the marketing budget to compensate for the price reductions. You could also negotiate with your suppliers, to get them to finance the discounts.
A piece of good advice is to set up concrete goals and KPIs for the initiative.
For example, if your goal is to acquire new customers – a suitable KPI is customer acquisition cost (CAC) which will measure how effective you are at acquiring customers. Setting the right CAC target depends on the probability that the customer will return. If they are likely to return you might not need to reach profitability on one single transaction and your target CAC can be higher and requires knowledge of customer lifetime value.
2. An organisational perspective
If you have a clear goal and ways to evaluate your strategy success, it’s time to determine your organisation’s readiness. If you’re evaluating the performance on Singles Day or preparing for Black Friday, we recommend you look into the following areas:
What’s your company’s pricing strategy for the day? Remember that many companies with low margins raise the prices on other products to compensate for the discounts.
- Campaign pages
Do you have the images and the copy you need? If not – when is the deadline for that delivery? Have you decided on a certain theme for these pages?
- Schedule the strategy
Make sure you schedule the strategy to ensure that the right prices kick in at the right time.
- Ads – price information
Have you ever experienced trouble with mismatching or wrong prices on your ads? Did you know that you can send sales prices and promotional offers in advance by enriching the sales price data with campaign dates?
- Ads – discount methods
Did you know that there is a difference in the way you handle regular sales prices and promotional deals in your product data feed? Google calls this sales_price and promotion_price.
- Order management
Can we handle the expected order volume? It is important to maintain your level of customer service and delivery time.
- Site readiness
Make sure that you share your campaign plans with your e-commerce solution partner. If you’re expecting a lot of traffic, it’s essential to check the site’s capacity to maintain high performance. How many orders per hour can it handle? How many visitors can the site handle without slowing down? If you are concerned about poor performance you can either temporarily enhance the site capacity or try to spread the visitors in different time slots.
- Involve your partners
Ask for help. Your SEM partner or e-commerce provider might have valuable input.
- Execution plan
Is there a carefully crafted execution plan and clear areas of responsibility? If not, craft away!
Does it feel overwhelming to execute on time? Remember that many e-commerce platforms offer scheduling functionality for activating content.
Most importantly, test everything carefully and learn from your mistakes. Use a staging website and prepare hands-on.
“Success or failure should not only be measured from a monetary perspective – you also need to look at the organisation’s ability to execute.”
Use your preparation plan not only to prepare but also to evaluate your performance. Don’t forget to give yourself credit for what went well and what parts that were improved from last time. Success or failure should not only be measured from a monetary perspective – you also need to look at the organisation’s ability to execute.
Another thing to keep in mind is that for some companies, Black Friday is a form of team-building activity. Given the increased number of orders, officials from the headquarters may come down to the warehouse to help pack. Culture-building!
Interested in more e-com tips? Our e-com experts Björn Wiman and Johan Englund answered 9 important questions about the Amazon launch here.