Hong Kong braces for the world’s largest online shopping spree on November 11

Alibaba Group Holding says the introduction of the Singles’ Day shopping extravaganza and the Tmall.hk platform to Hong Kong is an important first step in its push to ramp up services outside mainland China.

Daniel Zhang Yong, the chief executive with the e-commerce behemoth, said the Tmall online marketplace could help make up for Hong Kong’s relatively few hypermarkets.

“We want to offer a large variety of daily necessities to the city’s customers with the help of our partner, American warehouse club retailer Costco,” Zhang said at the launch of Alibaba’s 2016 11.11 Global Shopping Festival in Hong Kong Thursday.

Costco is a US retailer rivalling Wal-Mart, which is known for delivering bulk goods at low prices.

Alibaba also unveiled Tmall.hk, which allows for payment by credit cards and Octopus cards and transactions in Hong Kong dollars.

The event kicked off Alibaba’s flurry of marketing activities ahead of the Singles’ Day, an annual event held on November 11 that has already set the record as the world’s largest online shopping festival.

Purchases on Singles’ Day - started and trademarked by Alibaba in 2012 - have become a bellwether of consumer demand in the world’s most populous country, in the same way that the annual Black Friday shopping spree after Thanksgiving Day sets the tone for the US Christmas shopping season.

Alibaba’s Taobao and TMall sites are already among the 20 most frequently visited websites on earth. Their combined November 11 sales rose 54 per cent last year to US$14.3 billion, after increasing 60 per cent in 2014 to US$9.3 billion.

Alibaba said the festival’s arrival in Hong Kong was also intended to “test the waters” for its global expansion that might one day compete head to head against US rival Amazon.

US singer Katy Perry will kick off the November 11 gala in Shenzhen this year, according to Alibaba, owner of the South China Morning Post. Perry, singer of the pop hit “Roar,” is popular among the mainland’s millennials, and goes by the monicker shuiguojie, or “Fruit Sister,” in China.

She toured in China for the first time last year, performing sold-out concerts in Shanghai, Guangzhou, and Macau for her Prismatic World Tour.

“By inviting international stars, we bringing a globalised lifestyle to Chinese customers, that is exactly what Chinese people are pursuing with expanding wealth,” said Alibaba’s chief marketing officer Chris Tung.

Alibaba will also be bringing Hollywood glamour to its gala, appointing David Hill to direct the Shenzhen festival. Hill’s credits include serving as executive producer of such hit television shows as The X Factor, American Idol and was a co-producer of the 88th Academy Awards in February.

That’s the sound of the cash register as Alibaba braces for another bumper Singles Day

“This is our first step and we will never backtrack,” Zhang said. “It takes some time to educate and get shoppers in the city familiar with our channels and platforms, but I believe this time frame will definitely be shorter than five to 10 years.”

Alibaba is also looking towards Southeast Asia, reflected by its US$1 billion acquisition of Singaporean e-commerce firm Lazada Group, which also operates sites in Indonesia and Malaysia.

“For Lazada, we are helping it transfer its business model from a self-operative business, which is similar to JD.com, to a Tmall-like platform, where individual companies operate their own brands,” said Tung.

Luxury brands such as Burberry, Guerlain and Maserati will also take part in the Singles’ Day shopping extravaganza this year.

To add further attraction, Alibaba will enable mainland customers to use virtual reality during the 11.11 ­Festival.

During the 11 days leading up to the event, mainland shoppers can browse products in virtual reality at participating merchants in the US, Australia and Japan.

“The technology applies to an extremely limited set of products at Tmall now,” Tung said. “We do not expect the technology to contribute much to our sales during this festival, but it will provide a new shopping experience for customers.”

About 150,000 virtual-reality cardboards will be available for one yuan each on Taobao from Friday, but they are only reserved for the site’s senior VIP members on the mainland.

“I am not sure the virtual-reality stores will be maintained after the festival. It depends on consumers’ feedback,” Tung said. “But the virtual-reality technology at Alibaba is mature enough to be applied to the entire shopping process, from product selection through to payment.”

Augmented reality will also be featured for the first time at the ­festival. Alibaba will release a lo­cation-based augmented-reality mobile-phone game about two weeks before November 11. Consumers can follow the Tmall cat mascot to earn special promotions and prizes.