Singles Day 2017 Makes Big Money
How long before we start seeing Singles’ Day sales start popping up in the United States? Not long if Chinese retailers keep demonstrating the ability to turn November 11 into economic opportunity.
Singles’ Day is a Chinese shopping holiday popularized by major Internet retailer Alibaba (based in China, of course) who aims to celebrate living single and without romantic entanglement, as well as the cultural Chinese aspiration of being single and finding a partner. The date is set for November 11 each year (11/11, sets of two singles coming together, get it?) and is breaking more global sales records each year. The origins of the cultural holiday, however, date back to the 1990s and some pretty heavy urban folklore from Nanjing University.
Here in 2017, Alibaba reported that it facilitated a gross merchandise value equivalent to U.S.$25.3 Billion, most of this was across their leading shopping sites Tmall and Taobao. Since Alibaba is a marketplace, they calculate their revenues in terms of gross merchandise value which is the total amount of money transacted based on item cost without counting any discounts or returns. In essence, it’s a quantification of the volume of economic transaction, even though Alibaba’s actual revenue is only a portion of this amount based on marketplace commissions and other service fees (warehousing, shipping, etc.).
Alibaba itself only generates a direct revenue of around $24 Billion (also U.S. dollars, 2016), but it is growing quickly and steadily. Smaller Chinese marketplace JD.com transacted just north of U.S.$19 Billion on Singles’ Day. To put this into perspective, the combined activity of U.S. online retailers (Including Amazon) on Cyber Monday in 2016 was $3.45 Billion. Essentially, Singles Day is almost seven times larger, economically, than the largest U.S. equivalent.
Amazon is still sizably larger than Alibaba with direct revenues of $136 Billion compared to $24 Billion, respectively. Both companies are amazingly similar as they operate multiple online retailers within their countries of origin and internationally, both operate cloud infrastructure services, and both have even forked the Android Open Source Project to varying degrees of success.