Have you checked your calendar today? Do you know what day it is?
Many of us living in America look at November 11th as any other day on the calendar. Many people are also celebrating Veterans Day.
But in China, they are celebrating Singles Day.
One might ask, what is Singles Day? Singles Day is a holiday invented in the 1990’s in response to Valentines Day. Instead of promoting love for one another, the Chinese created an anti-love holiday promoting the single life. It is celebrated on 11/11 because of the connection between singles and the number ”1”. In 2009, China’s largest e-commerce company Alibaba Group had a vision and took a new interest into this holiday. They morphed it into a multi-billion dollar e-shopping holiday (similar to Black Friday). It turned into the greatest 24-hour cyber-spending blitz in the world because of the deep markdowns.
This holiday hasn’t always been about shopping. Below is a graph showing how much sales have grown for Alibaba’s e-commerce sites Tmall and Taobao Marketplace after reinventing this holiday in 2009. Alibaba was able to improve sales drastically by using quality to improve profitability. By reducing costs for one day and increasing productivity, we see profit increases.
American consumers spent $2.9 billion last year on Black Friday and Cyber Monday combined, compared to Alibaba totaling $5.8 billion in sales on Singles Day.
As we learned in class, quality is subjective, and perception is reality. This holiday was spread only by word of mouth. How crazy is it than within only three years, Singles’ Day has become the biggest 24-hour shopping event in the world? Alibaba turned it into a Hallmark Holiday and is now sweeping the market. Their stock is currently up 4.59 on the NYSE.
With this busy of a day, one thing that needs to be taken into consideration is inventory management. It is crucial to have a management team dealing with inventory related costs. Similar to Black Friday/ Christmas time having seasonal employees, do you believe they should have seasonal positions for Singles Day? Or it is not necessary similar to Valentines Day not having extra added employees?
Positions needing extra help begin with setup / ordering costs. Preparing purchase orders and managing inventory is essential to stay organized. Delivery charges are also another thing needing to be tracked. Holding / carrying costs will also need to be managed, along with shortage costs. This might all seem simple, but with $5.8 billion in sales in one day last year, these are a lot of things to keep track of and manage.
Leaving you with a few questions, how likely are you to participate in a Hallmark Holiday like Singles Day or Black Friday?
Does working on a management team during a day like this sound appealing to you?
What difficulties would you find in the management area of working on a day like this?