• Ellen Sun

China Commercialized Festivals 101: 5.20, 6.18, and 11.11

What pops up in your mind someone asks you to list some festivals in China? The most well known Chinese festival, the Spring Festival, or often known as Chinese New Year, might be one and the only answer for most foreigners. It’s so recognizable that international businesses have started, not only in China, to make use of the Spring Festival for their sales promotion in recent years. Similarly, Christmas and Valentine’s Day are becoming more accepted and celebrated by the Chinese. You can thank social media for blending the boundary between Asian and western cultures.


Nars: Spring Festival Limited Edition


Mainstream commercialized festivals in China

For retailers, it was natural to unanimously share their promotions around these natural shopping days linked to holidays including Black Friday and Boxing Day for Western countries.


Now, the e-commerce giants have taken control of the calendar and have created their own commercialized shopping festivals as a tool to stimulate consumer spending on their own platform. China has taken these shopping festivals to a whole new level with Double Singles’ Day (11.11) and 6.18 Shopping Festival. The former was created by Chinese e-commerce giant Alibaba while the latter originates from JD.com. Almost all businesses on these two platforms will take part in the shopping festivals and provide their consumers with a variety of benefits and discounts. It’s worth mentioning that many companies try amplifying the complexity of the discount calculation to earn more benefits year over year. Chinese consumers are becoming smarter and more cautious about these shopping festivals nowadays. 


Alibaba’s Tmall reported 268.4 billion yuan 

(about 38.3 billion U.S. dollars) in sales 

during the 2019 Single’s Day


The origin of "5.20"

These widely successful shopping festivals have spawned even more artificial shopping sprees.


Take for example 5.20, a modern internet Valentine’s Day. “Wo Ai NI” in Chinese means “I love you” and it also has a similar pronunciation to date 5.20, which has become an internet shorthand for the term love. They day popular for lovers has morphed into an e-commerce shopping bonanza based on love for your partner and for the family. At first, very little people showed interest in the concept. Lack of historical support makes the festival less convincing. However, cooperation amongst e-Commerce giants, retailers, and marketing agencies, businesses spent several years promoting the day to train the consumer to expect presents of love to be shared on this day if the love is true. In a short time, people have begun to pay for the concept to prove their “true love”. Irresitible promotions only make the gifts sweeter.


 520 promotion banner: sales for love


Three reasons for the success of commercialized festivals

These commercialized shopping festivals have been so successful, western imitators such as Prime day have begun popping up. Why have so many commercialized festivals be created and work well in recent decades? There are three main reasons.


First, the birth of commercialized festival provides consumers more avenues to satisfy their needs to consume. People, products, and placement are the three key factors that affect the industry. Holidays like Mother’s Day and Father’s Day are good examples that provide successful consumption events. People find that presents are an excellent symbol to show their love physically. Over time, expectations are created and habits are established. Businesses educate the consumer on what products are “desired” and have benefited greatly from it. The saying, “A Diamond is Forever”, didn’t come naturally.


Second, seasonal inventory pressure create the need for promotions. Sales of consumer goods like apparel and accessories fluctuate dramatically with the changing of seasons. Figures from Tmall show that February and March (after Spring Festival) are the slack seasons for apparel sales. But sales afterward tend to moderately rise in April and May, which provide the perfect timing for promotional events such as shopping festivals to pick up the slack. Moreover, no brand wants to be known as a “discount brand”. The 6.18 shopping festival is positioned right in line with the end of season sale for the Spring/Summer collection and in this light, many luxury brands leverage this holiday as a pretext to take care of their remaining stock. These dates have become critical dates for designer brands as they account for more than half of their annual sales! Businesses being to prepare stock, promotions, and logistics months in advance.


 Sales data of  lady bags from Taobao


Lastly, certain festival atmosphere help brands present their unique characteristics and promote their brand image. Take love as an example. Love is an eternal theme. Though many people know that 520 morphed from an internet abbreviation to a capitalistic shopping frenzy, most of them are willing to pay for it because it’s about “love”. The consumer has been educated on the expectations of this date. Many brands, especially fashion brands, devote brilliant creativity and great efforts to make themselves a symbol of love on 520. Today, 520 is not only a special day for couples, but also a good timing to treat yourself well. How is this accomplished? Through consumption!


Chanel: 520 promotion poster on Weibo


Conclusion

Commercialized shopping festivals have been an inevitable trend in modern society where people’s needs and desires continue to expand with their spending power. The prosperity of e-commerce in China provides millions of businesses the chance to get a slice of the huge cake. Nevertheless, brands ought to regard commercialized festivals more as an add-on instead of the focal point. Do not underestimate the wisdom of consumers. They have become savvier overtime and inundated with a deluge of shopping festivals. They are the ones who ultimately decide to pay for your products or not.

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