It is the time of the year when brands are on all systems go for the year-end shopping festivals while consumers await excitedly for the deals made available. Singles’ Day isn’t even close to being over and Alibaba Group Holding has already surpassed US$56.3 billion in the 10 days leading up to the main event, all the way up until the first 30 minutes. Hailed as one of the biggest shopping festivals globally, and certainly with a mammoth presence in Asia, Singles’ Day has steep discounts from almost everything and anything under the sun.
While 11.11 has solidified its reputation as one of the major shopping festivals in Asia, along with Black Friday, data from Criteo showed that Double Days are growing into sales events of their own. In Malaysia and Vietnam for example, 7.7 was revealed to be an emerging sales peak this year, with increased retail sales by 132% and 64% respectively. Meanwhile in Singapore, Malaysia and Vietnam, 9.9 recorded substantial retail growth of 183%, 156% and 213% respectively. In October, during 10.10, the Southeast Asia region posted an overall 46% increase in sales compared to the last two weeks of September. Criteo added that the region also saw a conversion rate of 460% during the retail moment.
Meanwhile, share of app-based sales in the third quarter of this year stood at 75% for retailers with a shopping app. Southeast Asia was one of the regions with the highest app share globally. "We are seeing that the unique circumstances of navigating COVID-19 have actually resulted in evolving consumer behaviour with regards to online shopping. Not only are people shopping more, they are also more inclined to using apps for retail," Criteo's MD, Southeast Asia and India, Taranjeet Singh, said.
Singh told MARKETING-INTERACTIVE in a statement that a good way to capitalise on these moments is to reach shoppers through retail media. Specifically, native and display product ads on leading retailer sites, right at the point of purchase.
Retail media ads can put a brand front and center on the digital shelf, when shoppers are most interested in what they have to offer.
Is there a shopping festival fatigue?
With new Double Day dates emerging, in addition to the more conventional 10.10, 11.11 and 12.12. moments, as well as the growing popularity of eCommerce, Singh predicts that shopping festivals are here to stay. To tide through the possibly longer shopping season, he said brands should plan the expected shopper demand well ahead of these moments to capture the consideration phase of shoppers and invest early, while also locking in early sales.
"This means increasing brand visibility and being where shoppers are. With shoppers now embracing an omnichannel experience, across apps, desktop and in-store, this means creating an impactful brand experience across every touch point, ensuring that all foundational, strategic planning should be done together and no channel is planned in a silo. It will be crucial to tie together both online and offline analytics as well to ensure actionable decision making at every touch point that a consumer interacts with your brand," he added.
Meanwhile, given physical stores are starting to reemerge as markets start to slowly open up, multi-channel retailers in particular, need to come up with strategies for their physical stores. According to Singh, this includes looking for ways to be affordable, and more importantly, to be safe and ensure adequate distancing and health measures are in place.
That said, while variety of shopping festivals might initial seem beneficial to consumers who are always on the receiving end of discounts, industry players do believe that there is a fatigue stemming from the numerous shopping festivals as well as the year-end festive season. Guillaume Legond, dentsu Singapore's client director and commerce lead, media group told MARKETING-INTERACTIVE that at the moment, marketplaces are all losing business with the bet that at some point, one winner will take it all. He explained that shopping festivals, especially Singles' Day, was an avenue for the brands to offer that value to consumers to shop with them and create stickiness.
"Consumers usually have a wish list and if their product is not on discount on 9.9, they will wait until 10.10 and so on. These shopping festivals create opportunities to shop. Where I see the biggest risk is that it is obviously a margin killer for brands," he said. While the possibility of brands disassociating themselves with shopping festivals is yet to be seen, Legond said marketplaces are also at risk. Reason being, without brands committing to marketplaces, the latter would not be able to drive sales. Hence, there will need to be a fine balance for brands.
"Brands could segment the way they approach shopping festivals. So for 9.9, for example, it might be a testing ground for stock keeping units (SKU) that make the less margin while the hero SKUs will be given the extra push on 11.11 to get a certain return on investment," he explained.
Likewise, Prantik Mazumdar, MD, CXM group at dentsu international said when jumping on the trend of shopping festivals, brands need to be ultimately sure they are able to acquire the right kind of customer and if they have a system or an engine to convert them into profit. "I do agree that it is going to be hard to differentiate 9.9 or 11.11, ultimately these are all cheap discounts. I am sure the customers will still enjoy discounts but the critical question is how do I convert their expenditure into profits," he added.
While there is a possibility of shopping fatigue, smart brands would look at these festivals as more than just an ultimate sale, but also measuring these festivals as potential brand moments that entrench buyers as loyalists and even future brand evangelists, Geometry Hong Kong and Taiwan's head of strategy, Kelvin Gin, said.
What should brands do for Singles' Day?
As brands gear up for Singles' Day this year, Singh said they should bear in mind to target the most valuable audiences through website and campaign optimisation. This also includes finding new, interested shoppers and re-engaging existing customers through data and insights.
It is also not enough for brands to merely advertise their Singles' Day deals. They need to ensure that ads are served in the right context and with the relevant context to their specific audience. "This means considering the timing at which ads are served, preferably at a time when a consumer is likely to make a purchase," Singh added. Additionally, with customers looking to get the most value from their purchases, it is key to ensure that this is communicated to customers. Brands looking for unique ways to differentiate their offerings can consider unique and practical customer services, including safer store shopping options and online-meets-offline purchasing to address customer concerns during the pandemic.
The role of fulfilment in eCommerce loyalty
The COVID-19 pandemic has allowed eCommerce to play a crucial role in consumers lives, as consumers worldwide experience lockdown and social distancing measures. Consumers will naturally be unhappy if fulfilment does not meet expectations, especially if they are purchasing necessities. Spotlight Singapore, Harvey Norman Malaysia and IKEA Malaysia are examples of brands that were on the receiving end of unhappy comments online when consumers' orders were not fulfilled as promised. Meanwhile, there is also a possibility that consumers might flock to a certain brand or marketplace if they offer free delivery, for example.
It is definitely harder to build loyalty with all the "offers" out there through all the different online shopping channels, Kevin Kan, current CEO of Break Out Consulting Asia and former managing director Asia of CRM and loyalty company AIMIA, said. He added:
During this economic downturn, as times are tough, consumers are looking for value and may not necessarily be loyal to a brand.
Brands need to do extra work to keep their customers loyal with better perceived value or provide relevant products. "Just take a look at the Under Armour sports face mask. It is totally relevant to the global pandemic we are currently living through. Asics has also just launched its sports face mask that is more expensive than Under Amour! So these competitors are not going down the sale route but promoting superior product benefits - thereby garnering more loyal customers," he added.
Similarly, Geometry's Gin said while it is harder for brands to build strong loyalty, it is also a great opportunity for them to think of the integrated messaging strategies that can attract consumers. According to him, there is even more emphasis nowadays to understand the nuances of consumers so as to draw them to brands.
Beware of marketing scams
The digital world is rife with scams and the same goes for eCommerce. In May this year, the Singapore Police Force reported that at least SG$41.3 million lost to scammers in the first three months this year. Among the cases reported, eCommerce scams ranked first with 1,159 cases, which was 116.2% increase when compared to the same period in 2019. It added that 48.7% of the reported eCommerce scams were carried out through Carousell, while 17.9% were via Facebook and 15% via Shopee. Lazada and Alibaba were also used as transactional platforms for 6.6% and 1.4% of the reported scams respectively.
In August, the SPF also received at least 1,000 reports of social media impersonation scams where victims were tricked into disclosing their credit card information and one-time password in the first five months of 2020. SPF said that scammers would usually ask the victims for their personal details such as mobile number, internet banking account details, and OTP on the pretext of helping them to sign up for fake contests or promotions on Lazada or Shopee.
Break Out Consulting Asia's Kan said cyber crime, more specifically counterfeit or scam marketing is an important topic for marketers, due to the brand and reputational damage that can be caused by scammers if brands do not take action
"Consumers are looking to trust brands but if they don’t take action against scammers, loyalty could be lost. An example is the sale of iPhone 11s at SG$12. Which some people think are real given that iPhone 12s have been released and they might think that Apple is clearing stock," Kan said. He added that many policing agencies are educating the public against scammers during many of these Black Friday or 11.11 on-line sales festivals. Brands need to educate their customers to only shop at official websites which also helps promote online shopping safety and customer loyalty, Kan said.
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