11.11 used to be a sprint, but now it’s a marathon.

The context we find ourselves on the precipice of 11.11 is one of a luxury dichotomy. Many brands have been struggling to revitalize their growth numbers globally, leading to higher expectations on the brands in the China market. Other brands that have been posting strong growth numbers have leveraged China as one of their growth engines.

11.11 presents one of the biggest opportunities to drive revenue and brand awareness in the year. This year, things feel different.

Many brands we have been speaking to have been approaching 11.11 with a different strategy. In past years much of the revenue has been frontloaded in the pre-sales period. This has led to a race to the bottom – higher prices to play in earlier periods, a rush to capture consumer attention, and earlier discounts.

In the context of a marathon, this becomes unsustainable. Brand equity can be harmed with consumer spending also being even more focused on shorter periods with lower ROI. On the flip side, it can act as an opportunity to clear old collections (especially RTW and shoes), helping provide a short-term boon to optimize sunk costs.

The first data we have initially been paying attention to in the run up to pre-sales is the onset of discounts. We measured the average discounts of luxury brands on TMall across their portfolio in September, and in the week running up to the onset of the festival (21st October – 28th October). This is before the 8pm deadline on the 31st for the full amount to be paid.

📀 We saw six brands among the 129 official stores that we track that moved from 0% discount in September, to significant pre-pre-sales discounts – Acne Studios AB, BALENCIAGA, TOD'S, Valentino, and AMI PARIS

‍📀 Additionally, we also saw some brands that offered some discount in September but added a significant increase in the number of products and the depth of their discounting in the pre-pre-sales period: Versace, FERRAGAMO, Marni, and Chloé

‍📀 We are seeing typical discount rates of products on discount at a stock 40%. In the past we have seen some of these discount rates increase as we move through the festival.

📀 One brand that followed the early discounting trend in 6.18 but did not offer any discount during the pre-sales period analyzed is Burberry. As of the 31st we have started to see the brand offering discounts, but this is later than 6.18 this year.

Note: All discounts shown are averages across the products on discount over the period of analysis. An individual product might have fluctuating discount during the period. Discounts include direct discounting from the state listing price, as well as coupons affecting the purchase of 1 product per consumer.

As the festival moves into its first phase (post pre-sales), we will see brands offering more in terms of discount. Pacing is key. Sprinting out the blocks may win you the 100m, but building a brand is the equivalent of 26.2miles.