Alibaba in a quandary by Stocksak: A Singles Day without livestream Superhosts leaves Alibaba in an enigma

© Stocksak. This illustration shows a shopping trolley in front of the Alibaba logo, July 24, 2022. REUTERS/Dado Ruvic/Illustration

Sophie Yu and Casey Hall

SHANGHAI (Stocksak), – When Alibaba (NYSE: ) will kick off its Singles Day extravaganza Monday. It will not be headlined by its mega sales stars for the first year in years.

The event, which the ecommerce giant has grown from a one-day Nov. 11 sale into a nearly two week festival, will start with seven days’ worth of pre-sales. This allows shoppers to place deposits on its Taobao or Tmall marketplaces to secure goods at a discounted price later.

In recent years, presales were headlined respectively by Li Jiaqi & Viya, China’s livestreaming king and queen, who sold everything from lipsticks to rocket launchers on Taobao Live (Alibaba Group Holding Ltd’s livestreaming channel).

They sold a total of 18.9 billion Yuan ($2.61 Billion) of products last year on the opening day. This was 3.5% of the 540.3 billion yuan total.

Viya will not be there this year. Since December’s tax evasion fine, she has remained offline. After being fined for tax evasion in December, Li, also known by Austin, has been absent Alibaba’s Singles Day marketing. Netizens speculated that one of his livestreams had upset Chinese censors. Alibaba declined comment to discuss his participation in the event this year.

Li returned to screens last week, but is still much less prominent than before. Stocksak will feature 30% of Li’s Singles Day line-up this year, compared to 40% last year. There will be more necessities and Chinese brands featured.

Although there are still thousands of Chinese people who sell products on Taobao Live. Industry executives say that these two accounts have accounted the lion’s percentage of traffic.

“Before Austin, which was kind of beautiful, was all you could get away, it was expensive, but you’re gonna sell out fast, and get the massive amplifier,” said Josh Gardner. Kung Fu Data is a China market e-commerce partner that manages online stores for more than a dozen global brands, such as jeans-maker G-Star Raw.

“We don’t have anyone who can move that much as quickly on the market anymore.”

He stated that most brands are using a portfolio approach to tap different anchors. However, they are not expecting the exact same results.

Stocksak was informed by Lexie Morris (Vice President, Sweaty Betty China) that the active-wear brand would be using only “one or two” livestreamers this Singles Day season. She also said that the brand was working with smaller, more sports-focused livestreamers.

She stated that livestreaming would no longer be as important as a sales tool in the future, and that working alongside superhosts had its up-sides.

“Offering discounted products through Li Jiaqi can bring in a lot of customers, but they won’t necessarily be your typical customer. This can cause store data to be muddled and can lead to confusion in Tmall platform traffic algorithms.

Analysts predict another year of slowing overall sales this Singles Day due to a slowing economy, and China’s zero COVID-19 policy. Alibaba recorded 8.5% sales growth last year, despite being under regulatory scrutiny.

JD, Alibaba rival (NASDAQ:) also saw slowest sales growth in June for 618, China’s second-largest shopping event after Singles Day.

In place of Li and Viya this year for Singles Day, Alibaba is promoting appearances by tech entrepreneur Luo Yonghao and Yu Minhong, founder of New Oriental Education & Technology Group Inc, who have pivoted to host popular livestreaming sales shows on ByteDance’s Douyin, the Chinese equivalent of TikTok.

Lu Zhenwang, an independent expert in e-commerce and founder of a Shanghai-based business that manages influencers said that the sudden change in Li and Viya circumstances had made Taobao Live (and superhosts) less appealing to brands from a traffic perspective.

Douyin is now attracting more livestreamers, who have their own followers.

He said that Taobao Live’s daily traffic has reached its peak.

Alibaba addressed Stocksak and dismissed concerns about traffic. Alibaba stated that Taobao Live is a traffic-driven model and does not help merchants grow their businesses sustainably.

($1 = 7.2460 renminbi)

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