Was Taiwan’s 11.11 a blowout?

Excitement for annual e-commerce bonanza is fading; what is the future for 11.11?

Double 11 but a fraction of the excitement

Excitement for the 11.11 online shopping festival in Taiwan (think Black Friday) seems to be dulling year by year. Consumers have grumbled that the bluster surrounding last year's festival pales compared to its early days.

This seems part of a continuing trend, as 2022 was also deemed a letdown. However, at the same time, sales were still decent. In the first two hours, Shopee recorded sales of 10 million products, while momo's revenues were 4.2 times higher than an average day.

2023, feels like another damp squib. Based on the volume of goods in the first half of November and information leaked from e-commerce platforms, Commonwealth Magazine has approximated that across the board, sales increased by 15.58% compared to 2022, but that can be mainly attributed to a growth of over 30% in the number of shoppers participating in the event. Not bad, but not the glory days of year-over-year 30% revenue increases.

Netizens not feeling the buzz

Across the internet, consumers have reported a lack of enthusiasm for this year’s event and have speculated that sales are likely weak. The basis for this speculation included the absence of piles of packages at convenience stores and abnormally fast delivery times

Reasons for a weaker double 11 in 2023

1. Post-Pandemic e-Commerce Slump

   As with most of the planet, Taiwan's e-commerce sector boomed during the COVID-19 pandemic but has slowed down with the return to normality. According to data from the Ministry of Economic Affairs, online retail sales increased by 25.9% in the first three quarters of 2021, and during the Level 3 restrictions (quasi-lockdown period), they grew by a significant 33.8%. In comparison, in the first half of 2023, online retail sales only grew by a meager 1.1%.

2. Tourism Boom
   Taiwanese not being able to leave the island throughout the pandemic created a lot of pent-up demand for overseas travel, and this is where people are spending their money right now.

3. Economic Slowdown
   Despite impressive economic performance during the pandemic, the island kicked off 2023 with a recession and a year-on-year decrease of -2.9% in Q1 2023. Although Taiwan is still performing better than most markets, consumers are clearly tightening the purse strings and being more strategic with purchasing decisions.

4. Lack of Amazing Deals
   Many netizens have complained that this year’s deals were boring and the pricing wasn’t especially low. Some also suspected that retailers raised prices before the festival and lowered them for 11.11, creating an artificial sense of a discount.

5. Shopping Festival Overkill

   Another complaint is that there are now too many similar events in the annual retail calendar, so they don't feel any urgency to buy things. If customers miss out on the 11.11 event, they feel it’s not a big deal, as they are likely to find similar price promotions at a later event.

The future of 11.11 in Taiwan

I spoke with Rio Chen, a Taiwan e-commerce consultant and expert, about this year's 11.11 event and its implications for the e-commerce sector in Taiwan going forward.

Why has the response to this year's 11.11 felt underwhelming?

“The e-commerce platforms have not really made any mistakes this year in terms of preparation or marketing. They have all invested a significant amount of time in preparation, organized impressive promotion campaigns, and made efforts to secure the best promotional prices.”

"The truth is that the e-commerce sector is being compelled to offer lower pricing throughout the year, making it difficult for shopping events to feel special or pressure already squeezed brands to provide even lower promotional pricing. Coupang's entry into the market this year further drove down e-commerce profit margins.”

What advice would you give to retailers for next year’s event?

“11.11 will continue to be important, but the Taiwan retail event calendar is just too full. For cultural reasons, the Lunar New Year will always remain the key retail event in terms of spending.”

“There is limited opportunity to impress consumers with promotional pricing on 11.11, so retailers should focus on making the event more special. This can be achieved through personalization, offering unique or limited-edition products, or exploring other innovative promotions.”

“In 2024, I would suggest that brands prioritize driving traffic to their own online channels and offering promotions there. Every year, they are pressured by platforms to lower prices, pay for advertising, and cover other random fees. This increasingly means that, despite selling a significant amount of stock, they are no longer generating much profit from these events.”