Chinese Consumers Remain Passionate about Singles Day Despite Trade Tensions and Slowing Economy

Nov 8, 2019

Oliver Wyman survey shows over 50% of consumers intend to spend more than last year, with an expected increment of nearly 10%

SHANGHAI...More than half of Chinese consumers plan to spend more than last year at this year’s Singles Day shopping festival, despite a slowing economy, a new survey conducted by global consulting firm Oliver Wyman reveals.

Amid the ongoing trade tensions between China and the US, the survey also finds that 60% of consumers intend to purchase imported products during the biggest sales promotion annually in China.

Additionally, there is strong awareness of overseas shopping festivals, such as Black Friday and Cyber Monday, among Chinese consumers. More than 45% of the respondents are familiar with these festivals, and most of them would be willing to buy products from overseas and have them be shipped to China.

Singles Day continues to maintain robust momentum among consumers, with over 60% being more excited about this year’s festival than they were last year. Respondents are expecting to spend nearly 10% more than last year, according to the survey, driven by strong growth from tier 1 cities, where respondents allocate larger shopping budgets. Compared to their actual spending in 2018, the average budget of consumers from tier 1 cities has increased by around 20% this year.

Consumers from tier 3 cities tend to behave differently. They have the lowest average budget for Singles Day and about 63% of them think decent discounts are the main reason why they shop during the period. However, they show the greatest willingness to buy over-the-budget brands or products at the festival. Nearly 50% of them say they would shop at places that are usually slightly beyond their budget during non-promotion periods, while only 24% of the respondents from tier 1 cities would do so.

“Increasingly, it is brands and products that are driving growth in spending,” said Jacques Penhirin, Partner, Head of Retail and Consumer Goods in Greater China at Oliver Wyman. “Our survey shows ‘more choices of brand’ is now a top 3 reason for spending more this year, up from number 5 last year. Attractive discounts and more choices of products are the other two reasons that have helped maintain Chinese consumers’ frenzied involvement in the festival. The demand for imported goods seems not to have been affected by the trade tensions, and the positive Chinese consumer sentiment certainly exhibits the potential to extend to overseas markets.”

Imported goods are still popular and have retained a high penetration rate this year, with 60% of the surveyed consumers saying they are planning to buy imported goods during the festival.

The willingness noted is particularly prominent in tier 1 cities – where the penetration rate is as high as 73%. Cosmetics and skincare (46%), personal care products (42%) and clothes, shoes and bags (41%) are the three most popular categories.

Alex Shutter, Partner at Oliver Wyman, thinks Singles Day has become a festival for the whole year, not just for November. “Most discussion focuses only on the total sales of Singles Day, but this misses the longer-term impact on consumers. Over 60% of respondents state that in the future they will shop more at places from where they buy items during Singles Day. The winners during 11-11 will continue to benefit from their success in the future. So it isn’t surprising that we’re seeing brands and retailers investing heavily on more than just price discounts; notably through new product launches during Singles Day, as well as the increased usage of more engaging formats such as live-selling.”

Media Contact:

Eva Tong, Oliver Wyman

Tel: +86 21 8036 9313

Email: eva.tong@oliverwyman.com

Sophie Liu, Oliver Wyman

Tel: +852 2201 1717

Email: sophie.liu@oliverwyman.com

 

About the survey

The online questionnaire was fielded in Mainland China in October 2019. Oliver Wyman surveyed 1,000 individuals from tier 1 to 3 cities, including Beijing, Gaungzhou, Shanghai, Nanjing, Weihai, Zhanjiang, etc., asking them about their shopping habits during the Singles Day period. Of the 1,000 online shoppers surveyed, there was an equal proportion of male and female consumers. Moreover, 40% of the respondents have a monthly income between RMB5,000 and RMB10,000.

 

About Oliver Wyman

Oliver Wyman is a global leader in management consulting. With offices in 60 cities across 29 countries, Oliver Wyman combines deep industry knowledge with specialized expertise in strategy, operations, risk management, and organizational transformation. The firm has more than 5,000 professionals around the world who work with clients to optimize their business, improve their operations and risk profile, and accelerate their organizational performance to seize the most attractive opportunities. Oliver Wyman is a wholly owned subsidiary of Marsh & McLennan Companies [NYSE: MMC]. For more information, visit www.oliverwyman.com. Follow Oliver Wyman on Twitter @OliverWyman.