By Christine Tsui
Translated by Rachel Wang
Do you know the Double Eleven? Nov. 11th, the day before yesterday, is the largest shopping festival for Chinese. The information of it floods in my WeChat and it is reported that almost all the brands have broken their sales records. So, this time I would like talk about my own view on the Double Eleven Festival from the perspective of industry and consumption.
From the perspective of industry, several elements of Double Eleven have quite a reference value. First, I think Jack Ma, in the group of post-70s entrepreneurs, not only holds the best understanding of the post-90s and the Internet, but also is outstanding in the communication with customers. Originally the Double Eleven was only a point of shopping, but now it has become a grand carnival.
In addition, the festival promotes all the industries to some extent, which is held by one of my friend, Zhu Gangqiang, the founder of the Jacob Special Column. In his view, the explosive of the sales volume in one day or one week may cover the volume of the rest of a year, which would force all the industries to promote the efficiency of the whole supply and logistics chains. For instance, over 160 billion RMB goods needs to be delivered in 1-2 weeks. This volume would cover the annual GDF of some provinces. As a result, the supply, logistics and even online systems bear high requirements to deal with so many orders. Meanwhile, for many companies, the departments, from online system to customer service, would work overnight, so the severs also need to be fast enough to avoiding halting and delay of the orders.
As a result, hardware and software systems and even manpower faces a huge challenge, breaking the limits of a company repeatedly. From this view, the Double Eleven Festival rises the efficiency of the who industry, which is a positive effect.
However, I think this shopping mechanism has many negative effects at the same time. For myself, I only placed one order on the Double Eleven last year, and it was not a rush, but to book in advance. That’s all.
One of the side effects of this carnival is that some company would make their deals for whole year rushed into a single day. The insiders of online stores would know that the explosive sales would be followed by a high refund rate, 40% as far as I know of Double Eleven. Alibaba only exposes their sales data without the following issues.
Refund is a complicated business, immersed in the checks of each sections, costs of extra affairs and works of classifying. It can be imagined that the refunded goods may be only used once and sent back in wrong packages. For the sellers, this process is a kind of waste. The cost may never be calculated, or to say, exposed before. It would be a kind of harm for the companies.
Besides, the concentrated marketing is the same to a man full of leisure suddenly bounces up to fight overnight, which is far from common sense. Historically speaking, all the explosive stuff would not last for a long time, and the ones slow and steady would have a lasting vitality. In my opinion, the Double Eleven is not healthy as well, for it has no use in the long-term development of a company. Many companies only recruit staff for this particular day, and sometimes even a qualified courier is hard to find.
In conclusion, a large invisible cost hides behind the big day for shopping. It includes the cost of refund, marketing and temporary recruitment. , I think the extremely explosive sales mechanism is undesirable. Although there were offline activities before, 72-hour-sale from Dec. 30th to Jan. 2nd, the volume could not be as extreme as the Double Eleven, equivalent to a month’s sale.
In a word, I do not hold an optimistic attitude towards the future of Double Eleven. Comparing the explosions and long-lasting sales, I would support the later mode. But in this period, to be long-lasting is not as hot as to be fast. In the age of Internet, people would like to attach more attention to the myopic benefits. Above all, the money in hand is the best proof of success.