Singles' Day's enormous sales brought Alibaba a dose of criticism and controversy earlier this week regarding false advertising, but China's e-commerce giant has also had another massive shopping event to handle: 12.12.
The shopping holiday perhaps has more similarities to Black Friday than Cyber Monday, even though it comes second in line. Promoted by Alipay, the payment system under Ant Financial, an arm of the Alibaba Group, December 12 is a shopping event that extends offline, allowing shoppers to use Alipay to receive discounts in participating international shops. E-commerce giants like Taobao and JD.com offer deals as well, but the focus of the event centers more around doing activities outside of the home, such as eating out, going to the movies, and, of course, shopping at the mall.
Last year, the event saw the participation of around 300,000 offline merchants, up from 20,000 the year before. Many of these participants are international retailers in efforts to target China's outbound travelers. One of them is leading luxury travel retailer DFS Group, which offered coupons to customers at its airports and mall locations in Hong Kong, Singapore, New York, Los Angeles, and San Francisco. Coupons included 10 percent off selected beauty, fashion, food, and wine and spirits products, while shoppers were also able to unlock half-off discounts if they used Alipay.
DFS launched its collaborative promotion at its Causeway Bay location in Hong Kong with a flash mob event, and also installed a heat map from December 9 to 12 so that customers could see in real time where fellow shoppers were using Alipay.
Alipay's event is growing quickly. This year, more than 110 million consumers participated in its 12.12 event, up from around just more than 28 million last year. To get to this point, the payment company has been making major efforts in the past year to work with international retailers to capitalize on China's growing outbound tourism market. DFS Group only just started offering Alipay services at its San Francisco International Airport outlet in October, and commemorated the event by offering consumers who use the Alipay mobile app a 20 percent discount on select Origins beauty products. That same month, Auckland Airport also started offering Alipay, with the intention to give Chinese travelers to New Zealand “convenient, comprehensive services to bring a ‘taste of home’ experience.” Many other duty-free and major retailers have formed similar partnerships.
More recently, the payment service made a deal with several major banks in Europe to allow just over 900,000 more merchants to start offering Alipay services in their stores, a major move that could soon put pressure on global payment ecosystems like Apple and Google's Android Pay in competition for international consumers. In China, meanwhile, Alipay is going head to head with WeChat Pay, a service that's increasingly seeing cooperation from major luxury retailers, and most recently, Starbucks.