Singles' Day, or Double 11, is a mega shopping festival that originated in China. It is the biggest sales event for many parts of Asia.
LG H&H highlighted that it approached this year’s Singles’ Day tentatively because of Beijing’s restrictive zero-COVID policies.
“This Singles’ Day was held amid concerns about slowdown in sales performance as the Chinese government maintained a strong COVID-19 quarantine policy, leading to a slump in consumer sentiment.”
The firm’s Singles’ Day sales events were held primarily on Chinese e-commerce platforms Tmall, Douyin and Kuaishou.
Last year, the company operated mainly on Alibaba’s Tmall. However, amidst this difficult environment, it bet on diversifying its investments into fast-growing channels Douyin and Kuaishou – China’s top short video sharing platforms.
Despite the move to vary the channels, it recorded sales of approximately KRW360bn (USD272.5m) for Singles’ Day, a dip of 7% from the previous year.
The luxury beauty portfolio, which includes brands such as History of Whoo, Su:m37 Ohui, CNP, Belif and VDL recorded sales of KRW340bn (USD257.5m), down 7% from the previous year.
However, the fast-moving consumer goods (FMCG) major was relatively positive, noting that the strategy yielded results that “exceeded expectations”.
On the bright side, Whoo topped the rankings on both Douyin and Kuaishou. On Douyin, Whoo managed to rank number one in all categories, including beauty and electronics.
However, Whoo’s Tmall ranking dropped to 16th in the luxury beauty category. This is mainly because Kuaishou sales, which used to count with Tmall, now stand on their own.
Outside of the luxury category, derma beauty brand Physiogel recorded a sales increase of 80%. LG H&H said beauty consumers’ interest in the brand highlights major potential in the category.
LG H&H was not the only company that went into Singles’ Day in China carefully this year. Japanese beauty company Kosé Corporation, the maker of Decorté and Albion, also expressed that it was being cautious this year.
“Competition involving the Singles’ Day is intense… We have a conservative stance regarding Singles Day and expect sales to be less than during this shopping event in 2021,” said Shinichi Mochizuki, Kosé director and CFO, before the sales event.
This year was also the first time Chinese e-commerce titans Alibaba and JD opted to remain tight-lipped about their Singles’ Day gross merchandise volume (GMV) performance.
Instead, Alibaba released a press statement that said it produced results that were “in line with last year’s GMV performance”. Its main rival JD simply said its growth rates “exceeded the industry average”.
Despite this, Alibaba has been insistent that it is seeing a recovery in discretionary consumer spending.
On November 30, Alibaba’s head of investor relations Robert Lin told investors during a conference that during Singles’ Day, it observed signs of “decent” recovery in discretionary categories such as apparel and electronics.
According to Alibaba, Swiss luxury brand La Prairie’s GMV during the first four hours of the first sales window surpassed that of the entire 11.11 sales period last year.