Week 4: E-Business & M-Business on the Internet

The holiday season is approaching, and I'm sure that most of us are really excited to enjoy the accompanying festive goodies, bond with our families and friends, or to just bask in the festive atmosphere. But this season also entails something that some of us may dread: holiday shopping.

Ten years ago, most of us would have done our holiday shopping at physical stores — perhaps at "brick-and-mortar" shops or shopping malls. But now, retail has evolved, launching us into the age of "online shopping". This has become all the rage in recent years, and has actually become a threat to physical retail commerce.

Online shopping is a form of e-commerce that allows consumers to directly buy goods or services from sellers over the Internet. Consumers find a product of interest by visiting the website of the retailer directly or by searching among various vendors using a search engine, which displays the same product's availability and pricing at different retailers. Online customers must have access to the Internet and a valid method of payment in order to complete a transaction, such as credit cards, or an online payment service known as PayPal, etc. Online shopping has grown in popularity over the years, mainly because people find it convenient and easy to shop from the comfort of their home or office. One of the most enticing factors about online shopping, particularly during a holiday season, is that it alleviates the need to wait in long lines or search from store to store for a particular item.

The holiday season is undoubtedly the most important time of the year for many retailers and consumers. Shoppers are out in full force seeking out the best deals and the trendiest offerings. Retailers also come up with strategies to increase their sales during this profitable period. This has caused a trend called shopping holidays to emerge as a result of these marketing tactics. It all began with the Thanksgiving holiday in the US spurring businesses to launch the Black Friday sales to get shoppers into their stores. Quickly after, countries around the world followed suit by turning average dates on the calendar into must-shop events. As consumers started shifting their attention online, those events also migrated online in similar fashion.

It is unsurprising that consumers would rather participate in these retail events online than at physical stores as they can avoid the usual inconveniences of those sale events: terrifyingly large crowds (that have caused deaths), long lines, competing with others for products, etc. So let's take a look at some of these online shopping holidays.

Black Friday falls on the day after Thanksgiving Day (a holiday celebrated mostly in the US). Since 1952, it has been regarded as the start of the Christmas shopping season in the US. On this day, most major retailers open very early and offer promotional sales. While it is not an official holiday, many non-retail employees and schools have the day off, allowing for most people to be able to participate in the attractive sales events. It has routinely been the busiest shopping day of the year since 2005. While many people still physically go to major stores like Target and Walmart to shop on Black Friday, online retailers are increasingly attracting more customers as well. These sites commonly offer discounts by slashing prices of their products, or offering promotional shopping services like free shipping, which are all very appealing to consumers.

Local fashion retailer ZALORA advertises it's Black Friday & Cyber Monday sales

Cyber Monday refers to the Monday immediately following Black Friday based on a trend that retailers began to recognize in 2003 and 2004. Retailers noticed that many consumers, who were too busy to shop over the Thanksgiving weekend or did not find what they were looking for, shopped for bargains online that Monday from home or work. The deals on Cyber Monday are online only and generally offered by smaller retailers that cannot compete with the big retailers. They are also mostly offered by fashion retailers. Cyber Monday has recently become an international marketing term used by online retailers across the world, even Singaporean fashion retailers offer promotions on that day.

Chinese online retailer AliExpress advertises it's Singles Day sales

China, now the largest market for e-commerce, unsurprisingly has their own shopping holiday. On November 11, groups of unattached young Chinese get together and celebrate their singleness with a night of online shopping. The holiday, known as Singles Day (also noted as 11.11) originated in the 1990s with college students who were inspired by the date as when written numerically (11/11), represent four single people. This is China's version of Valentine's Day for people without romantic partners who treat each other to dinners and gifts bought online. Once an unknown event, Chinese e-commerce giant Alibaba has turned it into the world’s largest online shopping event in terms of sales. In 2009, Alibaba encouraged merchants on Tmall, an Alibaba platform that’s similar to Amazon, to offer promotions on the day as a way to boost sales in between two holiday seasons in China — Golden Week, a national holiday at the beginning of October, and the winter holidays of Christmas and the Lunar New Year. Alibaba advertised the day as an occasion to splurge on oneself. Retailers on that day commonly offer discounts of at least 50% off. In 2013, transactions on Alibaba’s online payment system Alipay reached 35 billion yuan — more than the combined sales of US retailers during Cyber Monday and Black Friday. About 100 million yuan was spent every minute over the course of 24 hours. And almost a third of the Chinese population, about 402 million people, visited Alibaba websites during the day, the company said. This is a testament to China's growing online market. China's online shopping population outranks the U.S. with 193 million versus 170 million, according to the Boston Consulting Group.

Today, advertising for 11.11 makes Christmas season advertising in the US look mild: It begins as early as three months before the day and ranges from social media campaigns to text messages and phone calls promoting deals. Rebates are offered in the form of “red envelopes” or hongbao that are traditionally given as gifts. Ads for this holiday also appeal to the country’s youth by playing on the idea of singleness — a reality millions of young Chinese face because of a widening gender gap.

An advertisement done by Tmall for its 11.11 shopping festival: