Arnon Dror | New Retail by Alibaba and Amazon
Arnon Dror says the “Amazon” of China, Alibaba just showed off its retail might. In a span of a minute and 25 seconds, sales numbers of last Sunday’s Singles Day already breached the $1 billion mark. Arnon Dror says the Chinese online shopping event is even bigger than Cyber Monday and Black Friday in the US combined, and that’s no small feat. The finance executive remarked how this is impressive given the trade tensions between China and the US, which can break down global supply chains and affect consumer spending. Image Source: Polk&Union
Alibaba Singles Day
The Chinese e-commerce giant reported, according to Arnon Dror, a new record of $30.8 billion in sales across all its shopping platforms over the 24-hour period. Some of its platforms are Taobao, Tmall, and AliExpress. While the three platforms seem the same with each other, they cater to different markets says Arnon Dror. Taobao as a C2c platform caters to small entrepreneurs and retailers, with more than 8 million merchants. Meanwhile, Taobao is a B2C platform that allows Chinese and foreign businesses to sell to Chinese customers. Finally, AliExpress is a B2C and B2B platform that allows Chinese businesses to sell to foreign customers and businesses. Alibaba also owns the Lazada Group which operates in Southeast Asia.
Last year, Singles Day sales reached $25.3 billion, setting the previous record. Arnon Dror says that the spending during Singles Day exceeded the spending of US shoppers on any holiday. Last year’s Cyber Monday record was only at $6.59 billion while Black Friday’s record was at $5 billion.
An hour into the Double 11 shopping event sales already reached $10 billion. Alibaba sells everything from gadgets and fashion to home improvement products. For this year’s Singles Day, Apple, Xiaomi and Dyson were among the top brands sold. Arnon Dror shares that Singles Day will help provide a boost to Apple’s numbers. This is because the tech company is reportedly losing its foothold in China. Last August, Apple reported selling seven million iPhones during the second quarter of the year, lagging behind homegrown brand Huawei with a market share of 27.2 percent.
If there’s one takeaway for businesses about the spending frenzy during Singles Day, it’s that online shopping is here to stay. In the US, Amazon continues to dominate the retail landscape, with a four percent share of all retail sales in the country. The e-commerce giant however has already made a move towards “New Retail”, since it started scooping up companies with physical stores like Whole Foods.
Alibaba on its part seems to be headed in the same direction. Instead of acquiring companies with brick and mortar stores however, they are striking partnerships with these companies to provide shoppers a new retail experience. Arnon Dror says that businesses can take cue from what Amazon and Alibaba are doing. For example, Alibaba’s most recent retail partnership is with Starbucks where the beverage company has a virtual store in Alibaba’s platforms. Customers order online or through the platform’s mobile app and make a payment. Once their order is confirmed, all they have to do next is to wait for their order to be delivered to them.