Watch out: Jack Ma's Singles Day is going to make Black Friday a lot less alluring.
There's trepidation in the air this holiday season. In just a few brutal trading days, the whipsawing US stock market wiped out its entire 2018 gain. Meanwhile, the US economy is heading for a 10th year of expansion, by far the longest in history. As the global trade war escalates, how much longer can this prosperity last?
In uncertain times, there's only so much money a consumer is willing to spend. The retailers that are the first to scoop up this dwindling pot of gold are those most likely to stay in the black.
Already, US retailers are piling into the Singles Day sale, originally a retail therapy concept invented by Alibaba Group Holding Ltd founder Ma to console China's lonely souls on 11/11, a date that resembles bare branches. The event always falls before the Thanksgiving holiday on the fourth Thursday of November.
I'm not talking about the kinds of discount stores that resonate with shoppers on Mr Ma's own Taobao platform. One example: Santa Barbara, California-based Aloyoga, which sells high-end yoga pants for more than $100 (3,300 baht) a pair, had already offered a 30% discount for Singles Day. So by Thanksgiving, I'm no longer interested in deals from Lululemon Athletica Inc -- my yoga urge is shopped out. (Aloyoga is offering the same 30% discount for Black Friday.)
Or consider Shopbop, an online apparel platform owned by Amazon.com Inc. For Singles Day, it was offering 15% off the entire site; so the 15% Black Friday discount on orders over $200 looks less appealing.
To be sure, Black Friday still offers great deals. Just before I started writing this, I placed an order for essential oils at Rocky Mountain Oils -- 30% off. Now I plan to take a look at the J Crew website -- 40% off. Still, the race to be first to consumers' wallets is heating up: Days ago, retailers were sending out emails on their planned discounts.
Black Friday is a fun shopping event almost as ingrained in Thanksgiving tradition as turkey. But as consumers shift their purchases online, deals matter more than tradition.
Millennials, in particular, are value-conscious. According to a recent survey by Bank of America Merrill Lynch, more than three-quarters of consumers in this age bracket say they would take advantage of discounts on Black Friday or Cyber Monday, more than any other generation.
Clearly, Singles Day has not yet taken the US by storm. In the BAML study, 61% of people surveyed said that by Nov 19 they hadn't started holiday shopping. But as deals spread and retailers seize on any "event" as a hook for earlier discounting, it's only a matter of time.
Chinese brands have had about as much global success as Chinese soft power, which is not much. Jack Ma, on the other hand, is on to something: Black Friday or Singles Day, because all we want is a good deal. - Bloomberg Opinion
Shuli Ren is a Bloomberg Opinion columnist covering Asian markets.