Last Wednesday’s Singles Day was a veritable sales bonanza for China’s online retail market. E-commerce monolith Alibaba reported US$14.3bn in sales transactions across its various websites during the 11.11 Global Shopping Festival, smashing its previous record of US$9.3bn set last year. Rival JD.com also had a record day, reportedly taking more than 20m orders as of 5pm China time, which far surpasses the 14m orders it processed for the 24-hour period last year.
Initially created as an anti-Valentine’s day by Chinese university students, Alibaba began to promote Singles Day as a shopping festival in 2009, offering discounts and specials. Its local competitors soon got in on the act. Double 11 – as it is also known – has since developed into China’s biggest shopping day of the year, when an online population of around 668m – single or not – buys gifts and celebrates.
Singles Day surpassed Black Friday in the US last year to become the world’s largest shopping day. To put the latest figures into context, Alibaba’s US$14.3bn sales in the 24-hour period compare with leading US retailer Amazon’s US$18bn sales for the most recent quarter.
Fruit sales soar
Three years ago, Singles Day barely registered any significance for China’s fresh fruit trade, but it is rapidly becoming a key date on the marketing calendar, with leading online fruit retailers conducting special promotions and registering remarkable increases in sales last week.
Yiguo, which was the leading fresh food retailer on Alibaba’s Tmall platform this year for Singles Day, was participating in Double 11 promotions for only the second year. A company spokesperson told Asiafruit that Yiguo’s gross merchandise volume (GMV) hit RMB100m (US$15.6m) on Singles Day, a near 10-fold increase on the previous year.
“We ran promotions with huge price cuts across Yiguo’s Tmall stores and its self-owned platforms,” explained the spokesperson. “This year the theme for Double 11 is Global Shopping, so we selected the best seasonal fruits from all over the world that Chinese consumers love. The flagship products this year were Mexican avocados, Chilean cherries, Zespri Gold kiwifruit and Xinjiang Akesu apples.”
The spokesperson for Yiguo, which received a strategic investment from Alibaba last year, said that Tmall’s Singles Day fresh food sales doubled compared with last year.
Contrary to the ‘solo’ theme of Singles Day, the spokesperson said that online fresh food consumer behaviour is shifting towards more collective consumption. “Consumers today tend to purchase multiple categories for family needs, where in the past they focused more on a single category for individual needs,” she explained. “This trend is making things more competitive in fresh produce e-commerce.”
Fruitday goes solo
Rival online fruit retailer Fruitday, which was Tmall’s ‘sales champion’ for fruit and fresh food last year, decided to branch out on its own this year.
Fruitday announced in October that it would not participate in Tmall’s Global Shopping Festival, but would instead run Double 11 promotions on its own platforms, specifically its mobile app.
A spokesperson for the company, which received a sizeable investment from JD.com last year, described the move as “a strategic adjustment”. “We became more independent during the second half of last year when we launched our Fruitday mobile app,” the source told Asiafruit. “Thanks to the power of our brand and reputation, more than 5m users have installed our app and it has outperformed our third-party platforms. This year, more than 90 per cent of our sales have come from the Fruitday app.”
The Fruitday source said its app enabled the company to deliver better fresh food products and service to its customers. “[Third-party] platform giants have a traffic advantage, but they have many requirements for stores, and they want you to promote single products and run price discounts,” she said. “Our own platforms focus on the quantity and quality of users, and can manage the quality of user experience, products and logistics directly.”
The move appears to have paid off for Fruitday, which more than doubled its Singles Day sales, according to the spokesperson. The company processed 330,000 orders worth RMB31m (US$4.84m) in the 24-hour period, with 95 per cent of those sales coming via its own website and app. “The sales from our own platforms during this period was 15 times greater than last year,” said the source.
Fruitday ran a series of Singles Day promotions 'to mix sales with entertainment', focusing on products with 'standout nutritional value or flavour', according to the source.
“We made the shopping experience more enjoyable,” she said. “For instance, we had a green kiwifruit lucky draw, where people could enter online to try their luck. If they won a high-value coupon, they received a huge discount. We also partnered with Zespri and ran an event to promote authentic Zespri kiwifruit and the company’s traceability system.”
Zespri green kiwifruit, Mexican avocados, Washington Red Delicious apples, Vietnamese red dragon fruit, Xinjiang Korla Fragrant pears and Yunnan Candy oranges were the top five selling items for Fruitday during Singles Day, according to the spokesperson.
New entrant promotes new products
Sunshine Fruit, a new fruit e-retail brand established in February by well-known fruit importer Kingo Fruits, was participating in Singles Day for the first time, according to the company’s e-commerce business manager Patty Li.
The company used the occasion to promote Washington Gala apples and Chilean avocados, two items that recently gained market access to China, and to introduce them to Chinese consumers.
Sunshine Fruit worked with the Washington Apple Commission on its Gala apple promotion, offering the fruit at a 50 per cent discount (RMB19.9 for 12 pieces, down from RMB39.9) in order to boost consumer awareness. The company took nearly 70,000 orders for the variety on Singles Day, selling more than 800,000 Gala apples.
Heavy discounts were also offered on Chilean avocados, down from RMB89 for nine pieces, to RMB53. Sunshine received 13,000 orders, selling around 120,000 avocados on the day.
As a new e-tailer, Sunshine Fruit sold almost as much fruit on Singles Day as it had for the previous two months, with all orders on schedule to be fulfilled by 20 November.
“Singles Day offers a glimpse of the impressive purchasing power of the Chinese population,” said Li. “The sales and number of orders can surpass in one day what has previously been achieved during a whole season or year. For fresh produce, e-commerce is the big future trend, but we really need to keep improving the services such as logistics, storage and packaging to support that growth.”
Can logistics keep pace?
Indeed, as competition intensifies between online players in the fresh produce sector, logistical and infrastructure capacity is sure to be one of the key factors to separate the winners from the losers.
Yiguo launched its own cold chain logistics brand Anxianda on Double 11 to provide fast same-day delivery service to its users. “We’re confident our strong back-end supply chain can support our performance amid the fierce competition,” said the Yiguo spokesperson.
No comments yet