Photo: IC

With the approach of November 11, which has been celebrated as Singles' Day by young single Chinese since the 1990s, e-commerce platforms are launching new strategies to grab a slice of the pie.

Singles' Day has become known as a consumer bonanza in recent years, with online stores in particular offering wide-ranging discounts to tempt buyers.

However, amid the growth in competition, companies are having to come up with new strategies in order to stand out from the crowd. 

Massive promotions

Online business-to-consumer marketplace Tmall has become well-known for racking up massive sales during Singles' Day promotion activities in recent years.

On October 15, the company announced that it had prepared coupons and discounts worth 300 million yuan ($49.25 million) for consumers as part of this year's Singles' Day promotions.

Domestic online shopping platform jd.com launched its promotion on October 10, with deals on clothes, shoes, bags, and food. Dangdang's promotion began on October 22, including books and clothes, according to the Beijing News.

Jd.com, which unlike many of its rivals has its own logistics division, is also offering delivery discounts for enterprises using its platform. The company has also introduced more services such as improving its delivery capacity, storing more products and offering its logistics services to other platforms, according to a press release sent to the Global Times Thursday by jd.com.

SF Express (Group) Co, a logistics service provider, has lowered the price of some of its services by 40 percent since Friday, according to media reports.

SF normally charges higher prices than other logistics firms, but with the discount its prices are closer to those of the logistics firms normally used by e-commerce platforms, such as Shentong Express, Shanghai YTO Express and ZTO Express, Shandong Province-based news portal sdchina.com reported Friday.

Wang Yulei, vice president of Tmall, told the Beijing News on October 30 that rising competition in Singles' Day promotions is inevitable, but whether or not all the companies participating can make a profit is uncertain.

Usually, clothes, mother and baby products and cosmetics have more discounts since these products have higher profit margins compared with goods such as electrical appliances, independent analyst Chen Shousong told the Global Times Thursday.

Consumers' voice

A frequent online consumer in Beijing, surnamed Ji, purchases most of the daily necessities for herself and her 2-year-old daughter from websites.

"As for clothes, I usually buy what I can't get in shopping malls, or those available both online and in shopping malls," she told the Global Times Sunday, adding that online shopping saves a lot of time.

The problem during the promotion period is that you may not be able to get the goods you want, since online businessmen usually set a quota for the amount of products they will sell at a discount, she noted.

"I usually spend most of [Singles' Day] staring at my computer, and buy products at a high discount," said Ji, even if the products are not necessarily ones she really needs.

However, there are some problems, such as less reliable delivery services, partly due to the massive increase in sales.

"If I need something urgently, I won't buy it during Singles' Day," she said.

Also, the services available from online businessmen are often not as good as usual. Ji, who also runs an online shop on Taobao selling baby clothes and toys, admitted that it was hard to provide the normal levels of service during last year's Singles' Day.

"I had to answer questions from over 40 potential customers at the same time. I was so busy that I didn't know what to say," she said.

Bumper harvest

During the 24 hours of November 11, Fang Jianhua is likely to sell goods worth around 100 million yuan to 300,000 customers, xinhuanet.com reported Saturday.

Fang is the founder and CEO of Inman, a women's clothes brand based in Guangzhou, South China's Guangdong Province.

The company's sales exceeded 70 million yuan during last year's Singles' Day promotion, according to xinhuanet.com, and it was in the top three in terms of sales of women's clothes on Tmall along with HSTYLE and Lieb.

"We've been preparing for storage and sales of clothes since April," Fang was quoted as saying by xinhuanet.com, adding that the company had stored up clothes worth 450 million yuan in anticipation of strong Singles' Day sales.

During the Singles' Day promotion last year, the daily Tmall sales for clothes firm Jack & Jones and shoes company Camel reached 100 million yuan each, a level of success that made other platforms believe there was a lot of profit to be made from clothes sales, reported Securities Daily on October 30.

The total sales of Tmall and Taobao reached 19.1 billon yuan on November 11, 2012, according to data released by their parent company Alibaba Group the next day.

It was a 260 percent increase from sales of 5.3 billion yuan on Singles' Day in 2011, according to pedaily.cn, a portal for investment news.

The number of licensed vendors on Tmall last year was about 10,000, five times higher than in 2011, reported pedaily.cn in October 2012.

The number of new online shopping customers in the first half of this year reached 28.89 million, bringing the total to 271 million, according to statistics from China Internet Network Information Center.

Amid the rapidly growing market, platforms now care more about brand image and customer experience, rather than only caring about low prices, the manager of the Ji'nan branch of SF, surnamed Liao, was quoted as saying by sdchina.com.

"What affects customer experience is not products now, but the quality of delivery services, especially for medium and high-end platforms," said Liao.

Chen also said that delivery service and speed has become increasingly important. With the boom in online shopping, consumers have become more experienced and their ideas about online shopping are changing too, Chen noted.

If companies can't provide customers with good products and services, their brand image will be tarnished and consumers may start to avoid them, said Chen.