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Why Singles’ Day Should Be Factored into Your Brand Protection Strategy
- Brand Protection
Singles’ Day is the world’s largest ecommerce festival and is heavily targeted by opportunistic counterfeiters, posing a risk to consumers and brands.
Singles’ Day is the Chinese retail and ecommerce phenomenon that has skyrocketed in popularity over the last six years, outpacing similar sale events that are hosted throughout the globe. The scale of the event is huge; combined, Black Friday and Cyber Monday only achieved half as many sales by comparison in 2018 [1] [2], while Amazon only generated a comparatively minor $7.16bn [3] in sales during its ‘Prime Day’ in 2019.
What is Singles’ Day?
Taking place on November 11, Singles’ Day was first conceived as an ‘anti-Valentine’s Day’ celebration by Chinese students in 1993. The holiday rose to prominence in 2009 when Chinese ecommerce giant Alibaba encouraged brands and third-party sellers using its platforms to offer large discounts on everyday consumer goods for a 24-hour period, in the same vein as the then-emerging ‘Black Friday’. Alibaba signaled its ambitious intentions for the holiday by trademarking the term ‘shuangshiyi’ (double eleven) in 2012 to represent the date ‘11/11’.
Fast forward to 2017, and the event began to see offline expansion. Alibaba set up 60 pop-up stores across China and collaborated with retailers to launch 100,000 smart shops. A shopping mall in Hangzhou, China, was even opened in April 2018 in response to concerns that the Chinese ecommerce market was beginning to plateau.
With a third of the Chinese population purchasing items during Singles’ Day alone, Alibaba is expected to generate an eye-watering US$37bn in gross merchandising value from the event.
This year will see the expansion of available products to combat the knock-on effects from the ongoing US-China trade war. New product categories include cars and travel, with packages to the 2020 Tokyo Olympics and discounted tickets for Disney’s theme park in Shanghai available.
The continued strain of online counterfeiting
China continues to be one of the world’s largest counterfeiting hotspots; over 40% of goods sold online in China are fakes or of poor quality, according to a state media report released in early 2019 [4].
International brands accounted for over 40% of total purchases during Singles’ Day 2018, demonstrating their appeal to the Chinese market. Indeed this trend increases to grow; 60% of Chinese consumers intend to purchase imported products this Singles’ Day [5].
Worryingly for brand owners, America’s trade war with China is likely to increase the size of the counterfeit market in both China and the US by making imported genuine products more expensive and stretching the resources already deployed towards fighting illicit trade [6].
As Singles’ Day expands into developing countries in Southeast Asia following Alibaba’s acquisition of marketplace ‘Lazada’, the threat of counterfeiting to brands is increasing.
Opportunistic counterfeiters exploit seasonal demand
Corsearch brand advisor Tosshan Ramgolam states: “Listings taking part in Singles’ Day promotions feature banner images next to the price. Corsearch’s brand protection tool, collects the text in these banners and uses that as an indicator for risk to monitor counterfeiting activity for brands”.
Other marketplaces also facing counterfeiting threats
Other platforms such as Pinduoduo, a ‘group-buying’ platform, take part in the event. The platform is used alongside immensely popular WeChat (China’s equivalent of WhatsApp) for social shopping, and now boasts over 483.2 million users, representing growth of over 42% since 2018 [7].
The platform is frequented by wholesale buyers who purchase in bulk to sell products to consumers through other ecommerce channels across the globe.
Counterfeiters attempt to entice both price-sensitive buyers and those that intentionally purchase fakes on Pinduoduo, and there are fewer intermediaries within the supply chain to scrutinize product authenticity. As a result, the platform has received numerous complaints of very low product quality and fake products and was added to the US government’s counterfeit ‘blacklist’ in April 2019.
What can brands do?
Whilst there is clear progress being made by marketplaces, social media platforms, and the Chinese government to combat IP infringement, brands need to be proactive.
A truly comprehensive brand protection strategy is essential and must combine a sophisticated technology solution, platform anti-counterfeiting tools, a well-maintained IP portfolio, and effective enforcement using local IP laws.
Register your intellectual property internationally
It is crucial to register your IP to comply with the law in each territory where you believe your products will be in demand, regardless of whether you plan to sell there. Infringers will exploit any gaps in your IP portfolio to frustrate the enforcement process.
Develop relationships with marketplaces and platforms
Brands should develop strong collaborative relationships with platforms, particularly in regions where your product is highly targeted. Many marketplaces such as Alibaba, Tmall and WeChat run brand protection schemes that aim to expedite the enforcement process.
Employ intelligence-led brand protection techniques
Brands shouldn’t rely on platforms alone to detect and remove infringements. Instead, they should invest in brand protection technology that can identify entire networks of infringers rather than individual accounts or listings. With this strategic approach, they can discover large-scale illicit networks, send notices against all entities, or utilize intelligence for offline action.
Online Brand Protection is key to reducing infringement
Brands must be prepared to face threats online from opportunistic infringers that exploit increased demand; it is critical to factor in holidays, sales and other events throughout the year into your brand protection strategy.
At Corsearch, we work with our clients to ensure they protect their consumers and brand reputation online. We allow our customers to meaningfully reduce online infringement and increase their online sales by targeting the largest infringers. If you believe your brand is under threat and are interested to see how our technology can offer a long-term solution to online infringement, request a free demo from one of our experts below.
References:
[3] https://www.digitalcommerce360.com/article/amazon-prime-day-data/
[5] https://www.cnbc.com/2019/11/08/alibaba-singles-day-2019-preview.html
[7] https://expandedramblings.com/index.php/pinduoduo-statistics-and-facts/
