A word of caution for e-commerce brands looking to market around Single’s Day

It is single’s day today. The day has been growing in popularity around the region and while this day, serves as an occasion for singles to party with single friends, e-commerce marketers in the region seem to be utilising it to gain momentum with their consumers.

Three weeks ago, Alibaba announced the launch of its 2016 11.11 Global Shopping Festival. The event offered marketing promotions, entertainment programs, and new product offerings from around the world to engage Chinese consumers.

Players in Singapore and Malaysia too have put up meaty deals to attract consumers on this day. For instance, in Singapore Lazada is hosting a month-long sale, which offer shoppers up to 90% off, over 100 flash deals and vouchers worth up to SG$100 each. When contacted by Marketing, Alexis Lanternier, CEO, Lazada Singapore, said last year, the brand saw an uplift of six times in revenue on key sale dates through Online Revolution – 11 November and 12 December.

“We are confident that this will be another record-breaking year for Lazada in Singapore and across the region,” he added. And  Lazada wasn’t the only brand to see a commercial gain on this day. E-commerce players such as Shopback, Zalora, Ezby and others Marketing spoke to also echoed this notion.

But other than the commercial gain, brands also stand a chance to expand their consumer base on such occasions said Tito Costa, chief marketing director, Zalora Singapore. He said:

Such occasions serve as an opportunity for e-commerce platforms to not only expand their consumer base by spreading awareness about their presence. This helps us gain trust in the highly cluttered market.

Josephine Chow, country head of Shopback however said that while the e-commerce industry in Southeast Asia is slowly and steady growing, there is still a long way to go.

“With e-commerce amounting to 5% of the total sales volumes in Asia, events like Singles’ Day act as the much needed growth propeller in such circumstances,” she added.

Why you shouldn’t jump on the bandwagon

Deviating from this sales led norm was AladdinStreet which has a completely different take on Single’s day. According to a spokesperson from the company, AladdinStreet has not announced any deals on this day. He said:

Many e-commerce websites are bleeding heavily because of the discounts put up during this festival.

And while he agrees that such events to add to the platforms traffic and creates a large database for future use, he said that price wars are never ending.

“At the end of the day e-commerce websites have to bear the burnt of it,” he said.

Agreeing with him is Linda Locke, marketing director, Godmother Consulting,  who explained that the Single day sale is a promotional ploy which can only work on short term basis and will become less effective overtime. She said that one cannot keep a sale idea running forever. Alternative solutions need to be found to keep the consumer interest alive.

Highlighting how regular use of such marketing strategy would box e-commerce platforms into a category she said: “If you are too successful at it, you will be damned by that success”.

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