The western side of the world is used to hearing about Black Friday as the biggest physical and electronic retail sales event. But a Chinese giant wants to change that. This Wednesday, November 11, is celebrated the “Singles Day”, also known as Double 11, a one-day mega-shopping event that, since 2009, Alibaba Group has been transforming into the largest festival of its kind in the world, dwarfing CyberMonday in the United States.
Last year alone, 11.11 generated $38.4 billion in sales and more than 1.3 billion orders. Behemoth numbers that are equivalent to three years of revenue from Brazilian e-commerce ($11 billion in 2019, according to the survey Webshoppers, by Ebit / Nielsen) and five times the revenue of American Black Friday (of $7.4 billion in 2019, according to Adobe Analytics). In addition to discounts that include products from famous brands, 11.11 features concerts, and artistic events. The strategy of the e-commerce giant has been successful: last year, in just the first 85 seconds of the event, Alibaba registered $1 billion in sales globally.
AliExpress (Alibaba’s international marketplace) arrived in Brazil in 2014, but only this year it decided to bring the full format of Singles Day with concerts and local artists to Brazil. The presenter of the Brazilian reality show A Fazenda, Marcos Mion, is the host of the campaign. Within the program, he has been using items from the marketplace.
Among the “faces” of the Brazilian campaign, there are the fitness influencer Gracyanne Barbosa, the singer Gretchen, and the YouTubers Rezende and Dani Russo. By advertising 11.11 on Brazilian television, AliExpress aims to win over consumers who are only now learning to buy online.
Besides marketing, Ali is also betting on a better shopping experience during the festival, both in terms of payments (purchases can be split up in installments up to six times) and logistics (the company has three charter flights to reduce the delivery time of orders made by Brazilians, and also offers the service “AliExpress Direct”, which allows the consumer to receive products purchased in different marketplace stores in a single delivery package).
Also this year, AliExpress implemented the package return service that can be done to a Brazilian address, free of charge, and with a full refund for items marked with the “Free Return” seal.
According to AliExpress, today, purchases made by Brazilians on the marketplace take, on average, a month to arrive. This makes 11.11 also an opportunity for Christmas shopping (there will be more than 200 million products with discounts of up to 70%).
AliExpress does not disclose individualized sales data by country, but according to Yan Di, AliExpress’ country manager in Brazil, 11.11 this year will be the most important for the company’s expansion in the country.
Below are the main excerpts from Yan Di’s interview with LABS.
AliExpress idea is that this year the 11.11 will beat Black Friday in Brazil?
We have not established a direct relationship with other business dates, as we are, in fact, active participants in the Brazilian Black Friday. We know that this year, however, the sales of 11.11 in Brazil will, for the first time, be integrated with promotional actions, which mix fun and entertainment. Also, in cooperation with affiliated companies and partners, we have implemented significant improvements in our service for Brazilians, such as three weekly charter flights, to shorten delivery times, customer service in Portuguese, return of products to an address in Brazil, new forms of payment in installments and the inclusion of more items in the free shipping model. All of these items should improve the experience of local consumers and, consequently, sales in the long run.
Is Latin America seen as an interesting market for you? How do you see e-commerce in the region after the pandemic?
Brazil, as the main market in Latin America, is already one of the five largest global consumers of products on our platform and enjoys improved logistics. The region is also one of the fastest-growing in the penetration of mobile internet users in the world. Brazil, for example, is the fourth largest world market in the number of users connected to the internet.
In this scenario, we keep the focus on the continuous improvement of our services and on creating solutions aimed at our users. It is undeniable that, in 2020, the pandemic generated clear changes in the purchasing profile of our users. From April, when the closing of trade began in many cities in Brazil, until the end of August, items related to the home and garden, household appliances, and fitness equipment had an increase of over 130% in sales, which shows that people sought more comfort for their homes in the quarantine period. Also, items related to remote work recorded an explosion in sales, such as work tables and chairs, microphones, mice, and keyboards. The most impressive category was the sale of webcams, which was 38 times higher in this period than in the same period of 2019.
But we cannot say that the growth of e-commerce occurs only because of the pandemic. The pandemic has accelerated it, but Brazilian e-commerce has been evolving in recent years. With the strengthening of the economy in the post-pandemic and the recovery in household income, the trend is for a greater expansion in 2021 and 2022. Note that, of the total retail sales in Brazil, only 5.1% is made through online channels, while in countries like China, this percentage reaches more than 30%, which indicates the enormous potential for the digitization of local retail.
How will new retail work in Brazil? Is it foreseen for next year?
A few years ago, in a pioneering way, the Alibaba group led the development of a process that integrates sales that take place in the online world with those that take place in physical retail, the offline world, what we call “New Retail”. One of the group’s companies, Freshippo, which operates the supermarkets HeMa, is a great example of this. In these networks, it is possible to make purchases directly in the brick-and-mortar store, the offline channel, but also to place orders per app.
It happens that there are some items, which due to their characteristics, such as low-profit margin, low ticket, high relative weight for transportation or simply because they are perishable, such as cold drinks, water, and juices, are not worthwhile products, economically, to be sold through traditional e-commerce. In this sense, the integration of the two channels (online and offline) is very efficient.
In this model, New Retail stores, such as HeMa, operate with low-cost product deliveries, in up to 30 minutes, in a 3 km (nearly 1 mile) circle. Thus, its stores, in addition to physical points of sale, become points of stock and distribution of products in the neighborhoods and regions in which they operate, enabling online and offline sales in its perimeter. It is an approach that has been transforming retail in the world.
In Brazil, besides operating online sales through the AliExpress website, we have already experimented a physical store in the city of Curitiba, allowing consumers to have a real experience with our products and technologies. Certainly, exploring the advantages of New Retail in Brazil is a possibility on our horizon.