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November 11th Singles Day:
An Overview of the World’s Largest E-Commerce Sales Event
Presented by: Brendan Ahern [email protected] 1
KraneShares is dedicated to raising awareness of opportunities in China’s economy & capital markets among
global investors
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What is Singles Day?
Singles day is a day of celebration for people who are single. The date is chosen for the connection between singles and the number '1'. This holiday has become popular among young Chinese people. In recognition of the day, young singles organize parties and karaoke to meet new friends or try their fortunes. It has become the largest online shopping day in the world1.
Singles Day or Guanggun Jie (Chinese: 光棍节) literally means "bare sticks holiday”
1.) C. Custer (October 14, 2014). "Tmall CEO: this year, Alibaba plans to take Singles Day global". Tech in Asia. Retrieved October 20, 2014. 3
How Did Singles Day Start?
• Began at Nanjing University in 1993 as Bachelor’s Day
• The concept went viral online and quickly spread throughout China
• Celebration of One’s Single Status
• In 2009 Alibaba’s Tmall e-Commerce Platform Began A Promotional Sales Event
• Alibaba and other E-Commerce Platforms Offer Deep Discounts
• The first Singles Day included 27 merchants who generated sales of ~$8mm¹
Singles Day 2014 promotion from JD.com
Singles Day 2014 promotion from tmall.com
5 Source: ¹Quartz article “How Alibaba Invented the world’s biggest online shopping holiday” by Lily Kuo May 16, 2014
Where Is Singles Day Today?
• November 11th (11-11) Is the Largest On-line Sales Event In China & Globally¹
• Alibaba & JD.com Had $7.3 billion In Combined Sales.²
• In 2013 Cell Phone Maker Xiaomi Sold 200,000 Cell Phones in Three Minutes on Alibaba’s Tmall³
• On November 11th 2013 Alibaba’s Tmall had 402 million unique visitors up from 213 million in 2012⁴
• 346 million packages were delivered in the week following Singles Day in China⁵
• November 11th Has Historically Created Massive Volumes For Alibaba and Its Peers
• What Started As a Promotion Has Become The Largest E-Commerce Event Globally
Source: ¹Estimate by KraneShares, ²Tech In Asia “China’s Jingdong ends 11/11 shopping spree” Steven Millward November 12th, 2013 ³Tech In Asia “Xiaomi’s Singles Day flash sales shatters records” Josh Horwitz November 11, 2013, ⁴ iResearch ⁵Xinhua “Courier deliveries surge after online shopping spreed” November 18, 2013
On Singles Day 2013 Cell Phone Maker Xiaomi Sold 200,000 Cell Phones in Three Minutes on Alibaba’s Tmall³
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Singles Day – November 11th Is a Very Important Day for Alibaba In 2013, Singles Day generated US $5.75 billion in sales based on 254 million transactions.¹
Alibaba “Singles’ Day”
Sale
s ($
bill
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)
1.) Alibaba’s SEC IPO filings Graph source: Bloomberg Industries, comScore, Adobe
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20102009 2011 2012 2013
U.S, “Cyber Monday”
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Singles Day Leverages Alibaba’s Vast Third Party Logistics Network China Smart Logistics is a joint venture started in 2009 to facilitate the delivery of goods on Alibaba’s e-commerce platforms. As of September 5, 2014 the 48% Alibaba owned venture, has 14 partners employing 1.1 million delivery personnel in more than 600 cities. Shanghai Daily recently reported over 250,000 temporary delivery workers would be hired for this year’s Singles Day.
Source: Alibaba’s SEC IPO Filing as September 5, 2014 8
Source: Alibaba Quarterly Revenue From Bloomberg
Singles Day Creates Distortions To Alibaba’s Quarterly Results
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Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
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Alibaba's Quarterly Revenue (US $)
Source: 1.) South China Morning Post Article titled “JD Gears Up For Singles Day Spree” on October 20th, 2014, 2.) South China Morning Post Article titled “WeChat helps Tencent make over HK $637m in Single’s Day sales” on November 13th, 2013
Chinese E-Commerce Companies Look to Leverage Singles Day
JD.com homepage promoting Singles’ Day 2014 51buy.com homepage promoting Singles’ Day 2014
Tencent² • In 2013 Tencent’s mobile instant messaging unit WeChat, allowed users
to access partner 51buy’s e-commerce platform
• WeChat users generated 80,000 orders generating $81mm in profits
JD.com¹ • On Singles Day in 2013 JD.com did $1.6B in Revenue based on
6.8 million orders.
• Opened a 100,000 square foot warehouse in anticipation of Singles Day volumes
• Similar facilities planned for Beijing, Chengdu, Guangzhou, Shenyang, Wuhan, & Shian
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Singles Day Going Global? Aliexpress the key?
• Free Shipping for buyers in Brazil, Indonesia, Spain and Russia¹.
• Discounted Shipping for Hong Kong, Malaysia and Taiwan¹
• While Singles Day has historically been driven by Chinese consumers, $35mm of Singles Day 2013 purchases were done by buyers outside of China¹
Source: ¹Alibaba’s Azila website “China’s Single Day Onine Shopping Festival Going Global” by Melanie Lee and Susan Wang October 13, 2014
www.aliexpress.com
International Singles’ Day 2014 Ad from Aliexpress
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