China's annual Singles Day broke a new record yesterday, reaching 498.2 billion yuan (roughly $75 billion) worth of sales, marking the country's recovery and a return to purchase behaviour to pre-Covid-19 levels.
Held every year on 11th November, Singles' Day, 11.11 (so-called as the numerals resemble single individuals), Double Day or Guanggun Jie was first celebrated in the 1990s by young, single Chinese students as an anti-Valentine's Day and an excuse to buy themselves presents.
In 2009, Alibaba co-opted the informal celebration and started using the date to offer 50% discounts at retailers on its e-commerce platform Taobao. As the years passed, Singles' Day transformed into a mighty shopathon, China's own celebration of consumerism with more power to shift goods than the Black Friday and Cyber Monday sales days in the United States combined.
In 2016 Singles' Day sales reached $5 billion in an hour with a total of $17.73 billion worth of sales in one day; the following year Alibaba hit a new record reaching $5 billion in transactions in less than 15 minutes and closing with $25.3 billion of sales (a 39% increase compared to Singles' Day 2016) while in 2018 Singles' Day topped $5.3 billion in 12 minutes, closing at $30.8 billion in sales (an increase of about 27% compared to the previous year).
In 2019 total purchases for Singles Day passed the $56 billion and yesterday marked an increase of 26% with $75 billion. The total included an earlier three-day period (from 1st to 3rd November) that was added to boost post-pandemic sales. Results highlighted that Chinese consumers in general want to spend (and those who usually travel abroad and this year weren't able to do it and had therefore saved their travelling budgets, were keen to invest in luxury pieces), even though part of the consumer population was shaken by the pandemic that has brought a new variable in the spending equation - uncertainty about the future.
Livestreaming proved again to be a big driver and, as usual, the event was launched by the 11.11 Gala that this year also featured with a virtual show by headline performer Katy Perry.
This year Singles' Day kept on spreading to other Chinese e-commerce platforms like JD.com (JD), Pinduoduo (PDD) and Red, and brick-and-mortar stores (also outside China and based in Singapore, Malaysia, Indonesia, Thailand and Vietnam) launched dedicated events linked with Singles' Day, so the online to offline model has gone from strength to strength. The event also registered an interest in brands of products like electronics and smartphones as quality and design are getting better (Huawei, Xiaomi, Haier, Suning, Midea were bestsellers; beauty brands were the second best-performing merchant category) while prices are still lower compared to more expensive and hip brands like Apple.
There seemed instead to be bad some news for Alibaba's billionaire founder Jack Ma: the highly anticipated initial public offering of Ant Group, Alibaba's financial subsidiary, was halted by Chinese regulators. Despite the Chinese government wants to encourage consumption, government groups criticise Singles' Day and the state-backed China Consumers Association urged consumers to be rational in their spending. Other concerns for this year's event were the labour conditions of couriers and the strikes at courier companies that work as contractors to the major e-commerce players. The number of packages naturally increase around this time of the year, but, unfortunately for the workers, wages remain low.
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