China’s Singles Day (光棍节), held on November 11th, has become the world’s biggest online sale event in the last years. It involves the main e-commerce players and companies from China and abroad. Despite the high return rates, short-term sales of online retail events like this have negative environmental consequences including an increase of pollution and waste. Fortunately, sustainable thinking and environmental awareness have recently spread among Chinese online retailers, although this is still not enough.
So, what are the main negative effects? And how to reduce the environmental costs? Before answering these questions, I will provide an introduction to Chinese e-commerce and Singles’ Day online sales.
E-commerce Growth in China
China has recently been considered one of the biggest online retail markets in the world, and has developed successful e-commerce platforms and generated interest from foreign firms. As stated in a survey conducted and published by Statista (2020), “in 2017, over 44% of the online population in China had purchased products online. By 2022, this share is expected to grow to 58.8%”. Moreover, “in 2019, online commerce transactions in China reached approximately 9.9 trillion yuan”.
E-commerce platforms in China are grouped under two companies: the giant Alibaba Group and Tencent, the emerging challenger. Alibaba, with its Tmall and Taobao platforms, dominates the Business to Customer and Customer to Customer markets respectively. The company is also the owner of Tmall Global, a cross-border marketplace for foreign businesses. On the other side, Tencent is a social media and online payment provider that has recently expanded its strategic partnership with the second online retailer JD.com.
The world of e-commerce in China is closely linked to shopping festivals, during which the main online retailers offer huge discounts usually on traditional festivals or modern celebrations, among which Singles’ Day stands out.
Origin and Popularization of Singles’ Day
China’s Singles Day is a 24-hour mega sale that takes place every year on November 11th, also known as 11.11 or Double 11 (双十一). It originated at Nanjing University in 1993 as an occasion to celebrate single people, a sort of “anti-Valentine’s Day”. November 11th was chosen to represent singles’ day due to Chinese symbolism: the number 1 symbolizes an individual, a single person. Since 11.11 consists of four ones, November 11th is the perfect day to celebrate people who are single.
In 2009 Alibaba took on Singles’ Day, marketing it as a festival for singles to treat themselves with “retail therapy” and offering heavy discounts on its shopping platforms. Over the years, this event has become a highlight in the China e-commerce industry, involving more and more celebrities and live streaming influencers (Hallanan, 2020). Besides Chinese e-commerce leaders, many other emerging online retailers such as Pinduoduo, Secoo and VIP.com participate in offering massive discounts on their platforms.
According to Isabel Soisson (2020), writer for CNBC.com, in 2018 Singles’ Day online sales in China surpassed the comparable US Cyber Monday and Black Friday. Double 11 is also extremely popular in Southeast Asia, especially in Singapore, and it has recently spread even to western countries: several western fashion e-commerce and beauty shops already offer discounts to their customers during 11.11. Furthermore, for many international brands it is an occasion to promote their products to Chinese consumers, especially for luxury brands.
Singles’ Day 2020: Record Sales
Alibaba has set a new sales record year after year: in 2015, with the increase in revenues, the e-commerce giant introduced a television show as a part of the shopping experience, hosting international guests. In 2018, Alibaba’s sales volume exceeded 30.7 billion US dollars, and in 2019 it reached 38 billion in sales and organized a Countdown Gala Celebration and a live-stream, featuring American celebrities. This year, Alibaba set a new Singles’ Day record with a sales volume of 74.1 billion (Kharpal, 2020). Along with this sales boom, Singles’ Day Shopping Festival 2020 was characterized by two presale windows (from October 21 to 31 and November 4 to 10) introduced by Alibaba to reduce the pressure for retailers and courier services; a new fully automated warehouse opened by Cainiao Network, Alibaba’s Tracking Platform, in order to speed up delivery time, and the unprecedented participation of international brands (Mengqi, 2020; Najberg, 2020).
Furthermore, the current pandemic created new consumption trends: consumer demand moved towards essential items and healthcare products. Apart from new demand, there was a “sharp increase in online purchases of imported products due to the impact of the pandemic on international travel” (CGTN, 2020). Moreover, due to social distancing measures imposed to contain COVID-19, 90% of orders were made via smartphone, most using Alibaba’s payment platform, Alipay. The increase of smartphone users and mobile applications had already led to the spread of the phenomenon of mobile commerce in China, even before the pandemic.
The Environmental Impact of E-commerce
Greenpeace has expressed its concern about Singles’ Day defining it as a catastrophe for the planet, with consequences that persist for years (McGurk, 2020). Online sales’ fast packaging and delivery have a negative impact on the environment in terms of carbon emissions and plastic packaging waste. Greenpeace estimated that 2017 Singles Day’s total orders generated an additional 52,400 tonnes of carbon dioxide. Local transportation practices, and in particular the type of delivery vehicles used by sellers, along with the non-biodegradable materials used for packaging, are primarily responsible for these excessive carbon emissions (The Straits Times, 2020). As reported by Benjamin Yen and Grace Wong (2019), “often, the amount of packaging used to protect goods was in excess of what was needed to reduce the risk of damage during transport”. Additionally, e-commerce companies often choose to use low-cost and non-recycled materials, mainly based on cardboard, plastic bags and bubble wrap, which generate hundreds of thousands of tons of packaging waste (Kao et al., 2020).
Greener E-commerce
To assess negative consequences, it is reasonable to consider innovation in packaging and recycling incentives. In this regard, it is necessary to identify new opportunities for promoting sustainable consumption in China through improving awareness at both consumer and business levels.
A key step towards providing sustainable products for consumers and reducing environmental impact would be the implementation of a green packaging life cycle according to the LCA-Life Cycle Assessment of Packaging, created by the International Organization for Standardization. Retail companies should carry out the production, packaging and transportation processes with reference to sustainability standards (Lee & Xu, 2005). In other words, companies should use biodegradable materials, set up recycling processes, and adopt electric delivery vehicles.
Approved Sustainability Measures
The Chinese Government provided support for environmental protection industries by including a section named “Green Growth” in the 13th Five Year Plan, which contained a series of policy frameworks on how to promote sustainable development in different industries (Guo & Lang, 2016). In consideration of this, Chinese players and companies began to offer sustainable or eco-friendly solutions to make e-commerce greener. Both JD.com and Alibaba’s Cainiao have launched programs aiming to make online shopping more sustainable.
On one hand, Alibaba drove environmental sustainability by launching a “green packaging” program, which it then passed on to its courier service partners. Under the program, bio-degradable bags, tape-free boxes, and package-recycling bins are used. The choice of green packaging materials was confirmed again this year. Furthermore, Cainao introduced the “Cainiao Recycling Project'' in order to “direct customers to the closest recycling stations, for every box recycled, they scanned a QR code via their Mobile Taobao, Cainiao or Alipay apps to receive green power points [..]” (Yen and Wong, 2019).
On the other hand, in 2018, JD.com introduced eco-friendly packaging programs and adopted new advanced technology as drones to deliver parcels in rural areas. In 2019, “green packaging” has been expanded to nearly 30 cities. Moreover, more than 5,000 of the company's delivery vehicles have been converted to new energy. JD also educated and informed its customers regarding sustainability through its collaboration with environmental advocacy groups like the United Nations Development Programme.
With these initiatives, both companies are promoting delivery of small and medium-sized parcels in reusable packaging, raise consumers’ awareness on environmental protection, as well as reducing traffic congestion, waste problems, and air pollution.
Challenges to Overcome
According to Kao et al. (2020), the promotion of sustainable production and consumption is still negatively affected by limitations in many aspects, including the high cost of recycling; insufficient supervision of express packaging; a lack of suitable green materials, professional R&D talents for green packaging materials, and incentives for companies to adopt more sustainable options; the diversity of express packaging materials, and imperfect industry standards, laws, and regulations. In addition, there are also challenges associated with changing Chinese consumer behaviours that should be reoriented towards a more sustainable consumption.
In light of these considerations, despite the results achieved and the initiatives promoted by the biggest online retailers, there are still challenges to overcome. However, the aim to drive the country towards cutting emissions and protecting the environment has been underlined in the 14th Five Year Plan (Global Times, 2020). Therefore, more Governmental policies and regulations are expected to be implemented to encourage recycling from companies and consumers.
The biggest challenge will be to change the current attitudes of Chinese consumers, who are used to buying online, often in larger quantities than what they really need, encouraged by special sales days, like Singles’ Day Festival. Whether the e-commerce companies in China will be able to overcome challenges like these despite increasing numbers of delivery volume, is yet to be proven.
Irene Sacco, graduate in International Science and China Studies, is passionate about Chinese culture, international trade, and intercultural communication. Irene is currently working in the field of foreign investment, but she is open to freelance collaboration in writing and producing online content for editorial agencies, e-journals, and organisations focused on China. Find her on Instagram as @irenesacco, and on LinkedIn.
The opinions expressed here are those of the writer and do not represent the views of European Guanxi.
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References
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