Performance Analysis: Singles’ Day 2019

Singles' Day or 11.11 is the biggest shopping event in Asia. E-commerce retailers like Zalora manage to drive 130% more sell-out than in 2018 in the SEA region alone. In this report, we break down the Single's Day sale performance of major fashion e-commerce platforms Zalora and The Iconic, across Southeast Asia and Australia.

By Atiqah Kamarudin

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content image-cover Performance Analysis: Singles’ Day 2019

Introduction

Singles’ Day, which takes place annually on November 11, has become the biggest 24-hour online shopping event globally. This year, Alibaba posted a 26% increase in gross merchandise volume from last year, totalling to USD 38.4 billion. Besides expanding the number of discounted items and featuring the mega-celeb Taylor Swift, the retailer put emphasis on its live-streaming to encourage purchase.

Live-streaming commerce has now expanded to Southeast Asia (SEA), as Lazada, Shopee and Rakuten already launched the feature, successfully. With the wins seen from these retailers coupled with the growing e-commerce market in the region, Singles’ Day outdoes itself year-on-year.

In this report, we reviewed the biggest fashion e-commerce player in SEA, Zalora, during Singles’ Day to draw insights on its performance compared with last year. Data was taken from the three biggest countries based on Singles’ Day assortment size – Indonesia, Malaysia and Singapore. With Australia increasingly influenced by SEA, we have also analysed data from one of its largest retailers, The Iconic, to understand the market’s reception. More than 800,000 data points were tracked from November 1 to 14.

 

All data used in this report comes from products retailing online, as tracked by Omnilytics, unless otherwise mentioned.

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Zalora Performance Overview

With assortment up almost 100% for 11.11 2019, Zalora managed to drive more than 130% sell-out collectively from Indonesia, Malaysia and Singapore. Singapore saw the most significant increase in total sell-out count compared to last year, which was attributed to a big jump in number of discounted items. Despite showing improvement in sell-out from last year, of the three, Indonesia had the lowest sell-out even with 80% of items being discounted on that day.

Sell-out at discounted price increased 2x compared with last year, while full price sell-out saw a jump of 3x. Full price sell-out also skyrocketed by 5x compared with the average sell-out at full price a week before 11.11. This reveals an opportunity for retailers to drive full price products.

The number of products discounted for the first time this year also increased by more than 100% against last year.

 

Sell-Out Contribution by Gender

Similar to 2018, womenswear continued to be the key sales driver during Singles’ Day. Even with Zalora’s recent venture into kidswear in October, the womenswear segment still contributed to more than 70% of total sell-out. However, Singapore showed a lower contribution in womenswear this year (67%) compared with its neighbouring countries. This was mainly driven by a higher sell-out contribution in menswear, which jumped from 25% in 2018 to 30% in 2019. This signals the importance of the menswear segment in this country.

 

 

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Zalora Performance Overview (cont’d)

Similar to last year, Zalora kickstarted its Singles’ Day campaign in 2019 as early as November 1. This year, its campaign called ‘Spin & Win’ tried to attract consumers with gift cards and special discount codes by spinning the wheel game. As a result, this year’s sell-out started at a slightly higher base compared to last year but dipped over the next two days, before picking up again on November 4.

Sell-out grew steadily moving into 11.11, with an average of 30% increase day-to-day against last year. However, the key promotional dates, where Zalora started to aggressively promote on timely flash sales on November 8 and 10, saw a 16% and 41% decrease respectively against last year.

From Chart 3, consumers evidently tried to hold off purchases as they anticipated 11.11. The Singles’ Day total sell-out skyrocketed by 81% from the previous day, which also constituted a 132% jump from 2018.

The subsequent chapters deep dive into the factors contributing to the performance of each country.

 

 

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Zalora: Discounting Strategy

Out of the three countries, Indonesia was the most aggressive in its discounting strategy this year. Its discounted items contribution was higher than Malaysia and Singapore, averaging around 73% vs. 63% throughout the sale period. It kickstarted the Singles’ Day campaign on November 1 by marking down 65% of its items and gradually increased to 80% on November 11 (Chart 5). The majority (21%) of items were also marked down deeper than last year leading to 11.11, at 50-59% off. However, its performance paled in comparison to Malaysia and Singapore despite its aggressive markdown strategy, which only resulted in 2% sell-out rate.

Malaysia adopted a relatively shallow discounting strategy, unlike Indonesia. Most (22%) of the discounted items were marked down at 50-59% off in 2018. However, the most common discount range for this year was kept at 20-29% off on the week before Singles’ Day and went on a slightly deeper discount on 11.11 itself, at 30-39% off. Despite being less aggressive in the discounting strategy, it was still proven successful as sell-out count jumped more than 100% against last year.

Similar to Malaysia, Singapore had nearly 60% of its items on discount on November 1 and gradually increased to 70% by November 11. It kept the discount at 30-39% from November 8 to 11, as it did last year. Even with the same markdown strategy, it managed to garner 150% more sell-out than last year, which was the biggest jump out of the three countries.

 

 

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Zalora: Marketing Strategy

Promotional Codes

On top of the already marked down prices, Zalora also used limited-time promotional codes of different values to generate traffic and hype throughout the entire campaign period. Besides the ‘Spin & Win’ game, these promotional codes were communicated via newsletters and on the site landing pages.

Malaysia and Singapore had similar promotions in terms of value, brand and category offerings. Indonesia on the other hand offered slightly lower discount values during the entire campaign period.

Overall, the promotional codes offered on 11.11 this year were on a first come, first served basis, whereby the different discount values were capped to a limited number of users. In 2018, all consumers were generously offered 31% off discount code but for a limited time period.

 

 

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Zalora: Category Overview

Womenswear

Overall, Bags led the womenswear segment in SEA with 23% sell-out contribution, followed by Dresses (15%), Tops (14%), Shoes (10%) and Accessories (6%). For each country, the top 5 sell-out categories were similar to last year, though ranked differently.

Activewear in particular was popular especially in Indonesia and Singapore as it emerged in the top 5 this year. Activewear Shoes was the most sought after in the category, contributing to almost 30% of Activewear sell-out. In Malaysia, more Dresses went out-of-stock this year as nearly 80% of total Dresses were discounted on 11.11, compared to about 65% in 2018.

Meanwhile, Tops saw a decline in sell-out contribution against last year across all markets, with more than 5 percentage point difference. This shift revealed there was also a high interest in other categories such as Accessories, Jewellery, Ethnicwear and Jumpsuits & Playsuits.

Fast fashion brands reigned supreme for womenswear segment as brands like Pomelo, Zalora and Mango emerged as the top performing brands in SEA.

 

 

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Zalora: Category Overview (cont’d)

Menswear

For menswear, Tops remained the most popular category across all markets for two consecutive years. It contributed to a 25% sell-out, followed by Bags (15%), Activewear (14%), Accessories (11%), and Shoes (10%).

Each country shared similar top categories, except for Singapore, as Intimates emerged in its top 5 sell-out categories this year.

While Tops continued to dominate menswear, the category showed a huge decline in sell-out contribution against last year, with more than 8 percentage point difference. Among categories that showed a higher interest this year included Bags and Outerwear.

Adidas topped the menswear segment, followed by Tani, Superdry, Herschel, and Hollister.

 

 

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The Iconic Performance Overview

Singles’ Day

While Singles’ Day might be less well-known in Australia, the biggest online shopping festival has started to gain traction in the region. This year, The Iconic took part in the sales event alongside other retailers like David Jones and brands like Alice McCall, by giving away discounts of 30% off.

The retailer did exceptionally well on its first Singles’ Day, with a jump of over 300% in sell-out from the same day last year. With only 20% of products being discounted, the sell-out from the 24-hour event was 4x more than in the week leading to 11.11.

 

Click Frenzy

Click Frenzy ,which is one of the most anticipated online sale events in Australia, fell just a day after Singles’ Day on November 12. The event typically lasts for 24 hours only, but it was extended to 29 hours in 2019. The Iconic held it from November 12 to 15, also offering 30% discounts on its products.

While the total assortment and discounted items increased against last year, sell-out dipped by nearly 30% in 2019. This was due to Singles’ Day and Click Frenzy being held just one day apart, which may have cannibalised the sell-out for the second day of the event. As a result, total sell-out on the second day dipped by more than 50% to 1,038 SKUs. That being said, the Click Frenzy event still raked in a higher total sell-out than Singles’ Day.

 

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The Iconic: Discounting & Marketing Strategy

Unlike Zalora, The Iconic was less aggressive in its discounting and marketing strategy. The same strategy was implemented during Singles’ Day and Click Frenzy, whereby consumers were offered discount of 30% on selected items. No other promotional codes were given on either event.

Interestingly, newsletter subscribers were notified and reminded only for the Click Frenzy sale and not for Singles’ Day.

 

 

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The Iconic: Category Overview

Overall, womenswear was the key sales driver during Singles’ Day and Click Frenzy, contributing to a whopping 90% of total sell-out respectively.
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Dresses and Tops dominated the womenswear categories with the highest sell-out on both sale events. Despite already moving into warm weather, consumers were also stocking up on Outerwear, particularly Knitwear & Sweats.

Jewellery was another popular category bought by consumers during Click Frenzy, as there were 6x more Jewellery that went out-of-stock during the event compared to on Singles’ Day. As a result, jewellery brands Nest of Pambula and Amber Sceats emerged as the performing brands, while Atmos&Here and Topshop led during 11.11.

Meanwhile, Tops and Outerwear were the two most popular categories for menswear on both events. Interestingly, Jewellery ranked as one of the categories with the most sell-out on Singles’ Day, while Activewear and Shorts contributed higher during Click Frenzy.

 

 

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Conclusion

Main Findings

Deep Discounting Doesn’t Guarantee High Sell-Out: While discounts play a major factor in sale events, offering deep discounts does not necessarily translate into higher sell-out. Indonesia, which had the highest amount of discounted items (80%) and deepest discount range (50-59%) during Singles’ Day resulted in the least total sell-out compared to the other two countries.

Full price sell-out increasing by 5x more than an average day also proves that some customers are willing to pay full price. This gives an opportunity for new arrivals launching on a big sale event such as Singles’ Day. Nike recently capitalised on the Singles’ Day hype by launching Air Max 270 React and Air Jordan 5 in new colourways on 11.11.

 

Importance of Non-Core Categories: Core categories such as Tops are known to be the key sales driver for brands. However, as overall sell-out contribution for Tops showed a decline this year across all markets in both womenswear and menswear, it revealed that other non-core categories such as Accessories, Jewelleries and Bags were just as important.

 

Next Steps for Brands

Review Markdown and Assortment Strategy: For Singles’ Day, 30-39% off is the most popular discount range and has proven to work for the SEA markets. Given the hype surrounding key retail events such as Singles’ Day and Click Frenzy, brands and retailers can avoid deeper discounts to protect margin.

Brands should then review the type of products that they offer during these events to take advantage of the traffic. As consumers have become smarter, putting exciting products on sale is also crucial. Retailers need to think of Singles’ Day as a marketing opportunity, not just an opportunity to clear old stocks. Products with little to no size variants such as bags, scarves, accessories are also ideal during these events to minimise product returns.

 

Participate in New Retail Events: All these new retail events create both risk and opportunity for brands and retailers. Given the success seen at Alibaba, Shopee and Lazada during Singles’ Day, the event is set to grow year-on-year. Hence, participation in this sale event has become a barometer of brands’ presence in the market and an opportunity for them to take part in a substantial sales drive. Brands who are already participating in the event should review and manage pricing yearly and monitor competitors’ performance to help reveal categories with the most potential.

 

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