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By: Jasmine Seng

Originating in China, Singles’ Day was observed by the Chinese as a day for single people to celebrate and socialise. E-commerce giant Alibaba capitalised on this trend and transformed it into a consumerist holiday, featuring promotions from its retailers on its B2C platforms, such as Tmall.com and Taobao.com. Alibaba continues to exceed expectations as sales during Singles’ Day rose 60% in 2015, as compared to the sales registered in 2014, hitting a new record of US$14.3 billion. The celebration of Singles’ Day provides a major opportunity for retailers to reach a larger target audience.

Singles’ Day – a call for celebration

Special occasions such as Valentine’s Day, Mother’s Day and Christmas have always been important selling seasons for brands, particularly in jewellery, where the notion of gifting an intricate piece of jewellery is affectionately tied to the idea of love. Jewellery brands have always capitalised on such occasions to drive sales revenue. According to Tiffany & Co’s annual report in 2014, the fourth quarter typically represents approximately one third of annual net sales and a high percentage of annual net earnings. Demand for jewellery is seasonal in nature, with the bulk of sales driven by the holiday season at the end of the year. Additionally, jewellery pieces such as diamond rings are perceived to symbolise love. De Beers propelled the idea of a marriage proposal with a diamond ring, which was in line with the notion that “Diamonds are forever”, therein symbolising the eternity of a marriage. Hence, jewellery products such as diamond rings have been traditionally tied to the notion of being a gift from a loved one. However, it is important for jewellery brands to break out of the concept that is traditionally associated with the product. By moulding the perception of purchasing a piece of jewellery to signify independence and freedom on Singles’ Day, jewellery brands would be able to extend their target audience, which would, in turn, drive their sales revenue.

Moreover, societal perception of singlehood is evolving as a sign of independence and freedom. With an increasing trend of females in the workforce, this group of consumers is armed with a spending power that constitutes a large segment of the target audience of jewellery companies. According to Euromonitor International data, China, India and South Korea were among the top countries in the world based on average year-on-year value growth rates in jewellery in 2009-2014. There was a positive correlation between the year-on-year growth rates in jewellery and the annual disposable income of females in 2009-2014 in these countries.

year-on-year-growth-rates-jewellery-vs-annual-disposable-income-of-females-in-china

Source: Euromonitor International

year-on-year-growth-rates-jewellery-vs-annual-disposable-income-of-females-in-india

Source: Euromonitor International

year-on-year-growth-rates-jewellery-vs-annual-disposable-income-of-females-in-south korea

Source: Euromonitor International

The future of Singles’ Day

There is a huge opportunity for brands globally to tap into the idea of Singles’ Day, based on the impact of Singles’ Day on Alibaba’s sales revenue. According to Euromonitor International, Singles’ Day racked up sales of US$14.3 billion at Alibaba alone, which was approximately seven times the sales revenue driven by Cyber Monday, which is the biggest online shopping day in the US. In order to tap into the large potential of females with increasing purchasing power, jewellery brands would need to emphasise the positioning of their product to be desirable both as a gift for a loved one and as a gift that one purchases to pamper oneself.

Moving forward, the top markets based on growth rates of annual disposable income of females in the projected years could potentially be the source of revenue growth for jewellery brands. According to Euromonitor International forecasts, the top 10 markets with the highest projected growth in annual disposable income of females in 2015-2016 (measured in US$ million, current terms, fixed exchange rates, year-on-year growth) are as follows:

female disposable income growth rates

Source: Euromonitor International

As societal perception continues to evolve and singlehood is celebrated globally, Singles’ Day should continue to become a push for many retail businesses, not only in China, but also in the world. The demand for jewellery is seasonal in nature, with peak seasons during special occasions, when brands are able to ramp up promotional activities. Given the current volatile macroeconomic environment due to terror threats in Western Europe, slowing demand in China and political unrest in the Middle East, brands in the jewellery industry ought to be versatile in terms of their promotional activities to encourage the celebration of self-styled and non-traditional holidays, which are, in turn, excellent business opportunities.

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