Singles' Day (11.11)

Tmall’s cat, VR may bolster Alibaba’s 2016 Singles’ Day haul by 29 per cent, analysts say

2016 Singles’ Day sale may increase 29 per cent from last year’s US$14.3 billion, according to the average forecasts in a Post survey of analysts

PUBLISHED : Thursday, 10 November, 2016, 11:31pm
UPDATED : Saturday, 12 November, 2016, 2:14am

Alibaba Group Holdings’ 2016 Singles’ Day online shopping extravaganza will likely increase 29 per cent from last year’s haul to a record 125 billion yuan (US$18.45 billion), according to a South China Morning Post survey of five analysts tracking the company.

Top among this year’s attractions is a cat mascot -- taking the cue from Pokemon Go -- that can be followed via smartphones, exchangeable for discounts and prizes. Chinese shoppers will be able to browse in Macy’s New York store and other malls through using virtual reality goggles on Alibaba’s Tmall and Taobao platforms.

“We want to turn e-commerce into entertainment, and make shopping fun,” said Alibaba’s executive vice chairman Joe Tsai, ahead of a Shenzhen gala party counting down to 24 hours of shopping frenzy starting at midnight on Friday.

With advertisements on newspapers, magazines, China’s broadcast networks and even the trams rambling along Hong Kong streets, very few people are unaware of the planet’s largest online shopping event. In the process, Alibaba is upending China’s retailing industry.

The Hangzhou-based company has set up 20,000 stations in China’s countryside, making it easier for the nation’s 600 million rural residents to shop for imported products and services from Head & Shoulders shampoo to a Mauritius holiday, and even a 2017 Ford Mustang muscle car, all at discounts of as much as 50 per cent off normal prices.

Alibaba, which owns the South China Morning Post, will be helped by its stakes in media portals including Youku Tudou, which will be able to direct web traffic to Taobao and Tmall, said Guotai Junan Securities’ analyst Ray Zhao. He expects Alibaba to log between 125 billion yuan and 130 billion yuan, a 36 per cent increase in value from last year.

“More brands will have their celebrity endorsers take part in live webcasts of Singles’ Day marketing campaigns this year to interact directly with consumers,” Zhao said.

David and Victoria Beckham were the star attractions at a Shenzhen gala produced by the 2016 Oscar producer David Hill, kicking off the countdown to the shopping event.

Victoria Beckham, wearing a dress of her own brand, displayed a pair of sunglasses and presented them to a member of the estimated 2,000-strong audience that thronged the arena. Katy Perry, the US pop singer of “Roar,” withdrew from a headline performance at the event, after tweeting her disappointment with the US presidential election results.

After the Beckhams’ speech and presentation, Taiwan actress Lin Chi-Ling led the audience in a game of hunting for the Tmall cat through their smartphones.

Alibaba logged a record 91.2 billion yuan in gross merchandise volume (GMV) in 2015, 60 per cent rise from the 2014 tally. The e-commerce firm doubled its Singles’ Day, also know as double 11 shopping festival, sales to 57.1 billion yuna in 2014 from the previous year.

The outlook on China’s economy, which is expanding at the slowest clip in three decades, may cast a pall over the frenzied shopping, said Analysys International’s e-commerce analyst Yang Yaqiong.

“Consumers used to stockpile products at discounted prices in previous years, but some were irrational consumption,” Yang said in Beijing, adding that she’s forecasting a 20 per cent increase in this year’s GMV from the 2015 record. “It will be different this year, as consumers will care whether or not they really need these products.”

Retail sales for the first nine months posted a better-than-expected increase of 10.4 per cent from last year, while online sales grew by 26.1 per cent to 3.6 trillion yuan.

Still, the higher sales is likely to be a boon for Alibaba’s fourth-quarter earnings, said Maybank Kim Eng’s analyst Mitchell Kim.

Additional reporting by Alun John, Sarah Zheng and Summer Zhen