One thing that goes around the chatter in China these couple of days: why does the 11.11 shopping festival this year seem very quiet?

It is exactly one week away. However, the buzz seems not to be there yet.

On the contrary, many of the big sellers we know well are busy preparing cross border orders they might get from Black Friday.

There are numerous guesses on why this is the case. Do sellers and consumers become weary? Or platforms’ rules for promotions this year become even more complicated that people are just busy figuring it out? Or… is it just the calm before the storm?

Cheapest?

Nobody seems to know for sure. However, the game does become more and more sophisticated for both buyers and sellers, and it is harder and harder to get economy for both parties – hence many, while not giving up, seems to become more cautious.

Just to take a look at the following. The price of the same SKU actually increased during 11.11, even with the discounts.

This item costs CNY149 on a normal day
and CNY169.9 during 11.11

In fact, someone nerdy has done some research about 11.11 pricing in 2016 and concluded only less than 20% of the items are actually selling at the lowest price of the year.

17.17 per cent of items are selling at their lowest price on 11.11
Red bars represent percentage of goods not at the cheapest price in each category

Expert advice (for consumers)

A pundit shopper has advised fellow shoppers to get real good deals:

  1. Put a sticky note on each of your shopping device (laptop, tablet, smartphones) to remind you NOT TO shop with impulse; this is quite hard to achieve;
  2. Be familiar with quality, price and specifications of goods you intend to buy, such that you can immediately tell whether the deal is real or not;
  3. Ideally make a shopping list and focus on that first;
  4. Prepare enough energy to do the calculations to maximise the deals; and
  5. Prepare a good connection and get ready an hour ahead of the start of the day.

How about sellers

Many sellers in China find it increasingly harder and harder to compete in the domestic shopping festivals. Some have been exploring selling globally. Despite years of attempts and effort from multiple platforms, most of China’s outbound cross border volume still goes to the US, through Amazon or eBay.

These two years, through the effort of multiple platforms, including Linio, Shopee, JollyChic & Club Factory, Chinese sellers have started selling to other, emerging markets. The volume remains very small as of today.

Maybe the recent Trump withdrawal from Universal Postal Union (which could potentially raise cross border small parcel costs significantly) would divert more seller attention to emerging markets.

However, a key current challenge is that for many of these markets, infrastructure – including logistics and COD – is yet to cater to large influx of orders.

That’s why many of the smaller sellers did not even bother with Ramadan or White Friday promotions in the Middle East this year.

Thanks for reading The Low Down (TLD), the blog by the team at Momentum Works. Got a different perspective or have a burning opinion to share? Let us know at hello@mworks.asia.

 

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