Half of Chinese consumers to spend more on Singles Day 2023

10 November 2023 Consultancy.asia

Singles Day, also known as the ‘anti-Valentine’s Day’, is an annual shopping extravaganza in China that falls on 11 November. With improving consumer sentiment, nearly half of the respondents to a survey said they would increase their spending on Singles Day 2023, while most consumers to spend a minimum of 3,000 Yuan.

Originally created as an informal celebration for singles, Singles Day has evolved into the world’s largest online shopping event. It was first started as a joke by a group of young bachelors in defiance of the ostentatious couples-focused celebration of Valentine’s Day.

But in 2009, Alibaba CEO Daniel Zhang turned the day into a 24-hour shopping holiday that offers online shopping discounts in addition to offline entertainment around China.

CONSUMERS ARE NOT ONLY BUYING DAILY NECESSITIES, BUT ALSO PLANNING TO SPEND MORE ON DISCRETIONARY ITEMS AS A WAY TO REWARD THEMSELVES

This year commemorates the 15th anniversary of the huge online shopping event and 46% of consumers are likely to increase their spending this year. That is according to a survey from consulting firm AlixPartners on Chinese consumer behavior and trends in anticipation of the shopping holiday.

In 2021, Singles Day netted Alibaba around 540.3 billion Yuan ($84.5 billion) in sales.

“2023 marks the first Singles Day post-pandemic where consumption returns to ‘normal’ levels. We are seeing stronger sentiment and spending, evidenced by the 18% increase in total spending compared to 2022, more than three times last year's growth. However, brands need to be more intentional and targeted in order to differentiate and to generate the greatest returns this Singles Day,” said Britton Russell, partner at AlixPartners.

The latest Singles Day report from AlixPartners confirms that the shopping event remains the year’s bonanza for retail. Notably, nearly half of the survey respondents express their likelihood to increase their spending compared to the previous year, with 62% indicating their intent to spend a minimum of 3,000 Yuan this year, marking a significant increase from 2022.

CONSUMERS ARE LIKELY TO INCREASE THEIR SPEND WITH DOUBLE-DIGIT GROWTH THIS YEAR

Consumers are most inclined to boost their purchases in categories such as general groceries (42%), clothing, fashion, and accessories (44%), beauty and personal care products (42%), as well as lifestyle and home furnishings (40%).

Notably, the intent to purchase luxury goods shows the most significant decline at 24%.

Some Chinese consumers are calling for boycotts of Japanese products, including high-end skincare and everyday household items, in response to the recently discharged treated wastewater from the damaged Fukushima nuclear power plant. These negative sentiments have parallels to the past. In 2012, China encouraged boycotting Japanese products due to tensions over disputed islands in the East China Sea.

TOP 3 COUNTRIES WHERE CONSUMERS EXPRESSED THEY WOULD REDUCE PURCHASE

Similarly, in 2016, China boycotted South Korean products after South Korea deployed their new missile defense system, citing the installation as a national security threat. This boycott impacted South Korean industries, particularly in tourism and skincare. This year will see most consumers in China spending less on Japanese, South Korean, and Thai goods.

China largely dominates in e-commerce, with online low-cost options like Alibaba and JD.com booming in popularity. Livestreaming has become a large part of e-commerce big sales events, not just in China but across Asia. Brands work to build fan bases by offering special discounts to viewers of livestreams, with mostly young, Gen Z shoppers taking the bait.