New trends in e-commerce
It took just eight minutes for China’s Alibaba Group Holding Limited to tally $1 billion in sales on Wednesday, or Singles Day, the Chinese equivalent of Black Friday, an online shopping festival originally launched by the e-commerce giant.
By the end of the day, transactions of 16.5 trillion won ($14.2 billion) were made through Alibaba, and sellers and consumers from 232 countries participated in the sales, even though it is just a marketing event for Alibaba. The sales event became the world’s biggest shopping festival.
We are awed by China’s retail skills. We initially thought the Chinese mostly benefited from its enormous market rather than retail channels and techniques. Alibaba set up a situation room in the middle of Beijing and fed live coverage of sales tallies in its various distribution and retail channels. Foreign celebrities were also invited to augment the event.
It let down all barriers to allow foreign buyers to hunt for bargains during its sales promotion day. Singles Day has become a world event worth several billion dollars in e-commerce transactions.
It clearly underscores the changes in modern-day shopping. Consumers have become comfortable with shopping online. Traditional sales promotions in Western societies, like Black Friday or Boxing Day, pan out in brick-and-mortar retail shops.
But single-day transactions during China’s most notorious shopping festival suggests that e-commerce could soon become the mainstream when it comes to consumerism.
Cyber-shopping allows access to products that are not available in shops in a certain country, and wholesalers trade to sell those products in the local market. Even Korean manufacturers benefited from the purchases made on Singles Day.
So where does this put our retailers?
There has been a sharp increase in overseas purchases by Koreans online. Koreans are also familiar with global shopping events like Singles Day and Black Friday.
The government and local retailers are currently attempting to come up with a strategy to counter raids on foreign online shopping events. The country must come up with a better e-commerce environment to respond to these changes.
JoongAng Ilbo, Nov. 13, Page 30