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How Did Singles' Day Become A Billion-Dollar Event?

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How Did Singles' Day Become A Billion-Dollar Event?

U.S. retail investors are looking ahead to the critical Thanksgiving weekend shopping events, including Black Friday and Cyber Monday. However, for Chinese retail investors, it doesn’t get much bigger than this weekend’s Singles' Day event.

China's 'Anti-Valentine's Day'

In China, Singles' Day is like an anti-Valentine’s Day. Singles' Day is a relatively new holiday in China created by young Chinese students to celebrate being single. The literal English translation of the holiday’s name is “bare sticks holiday,” and November 11 was chosen specifically as the date because its numerical representation (11/11) is comprised entirely of ones.

Singles' Day originated at China’s Nanjing University back in 1993 and spread to other local universities throughout the '90s. The holiday was initially only celebrated by men. Today, single Chinese men and women alike get together to party with other singles every November 11.

Alibaba And The Commercial Aspect Of 11/11

The shopping aspect of the holiday is an even more recent phenomenon. Alibaba Group Holding Ltd (NYSE: BABA) first recognized the commercial opportunity back in 2009 when it started providing special online Singles' Day deals for shoppers.

The commercial aspect Singles' Day exploded back in 2011, when China celebrated the “Singles' Day of the Century,” 11/11/11. Many other Chinese retailers joined Alibaba in promoting holiday sales.

Incredibly, total 2015 Singles' Day sales in China came in at a staggering $14.3 billion. In the United States, 2015 Black Friday and Cyber Monday sales combined were only $5.8 billion.

After one look at the massive Singles' Day sales numbers, it’s easy to see why the holiday is so important for Alibaba, JD.Com Inc(ADR) (NASDAQ: JD), Vipshop Holdings Ltd – ADR (NYSE: VIPS) and other Chinese retailers.

Disclosure: The author is long BABA.

Image Credit: By Chrionexfleckeri1350 (Own work) [CC BY-SA 4.0] Wikimedia Commons.

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