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HONG KONG – Chinese consumers are spending tens of billions of dollars on items such as fresh food and luxury items during this year’s Singles Day online shopping festival, as the country works to recover from the economic effects of the pandemic.
The shopping festival, which is the largest in the world and usually starts in November, is an annual show where Chinese e-commerce companies including Alibaba, JD.com and Pinduoduo offer generous discounts on their platforms.
As of 12:30 a.m. today in Hong Kong, consumers had already spent $ 56.3 billion on Alibaba’s Taobao and Tmall e-commerce platforms since the company launched the shopping festival on November 1.
Rival JD.com reported cumulative sales of $ 30.2 billion as of November 1.
The shopping festival got its name as the main shopping day falls on November 11 of each year. Also known as 11.11 or Double 11, the numbers look like “bare branches,” an expression that refers to those who are single and unattached in China. Thus, the day later became known as Singles’ Day.
This year’s festival will be watched closely as a barometer of consumption in China, which is just beginning to recover from the coronavirus pandemic after months of lockdown earlier in the year.
Analysts expect Chinese consumers to spend more on imported goods and foreign luxury brands, as many Chinese tourists were unable to travel internationally due to the coronavirus pandemic and tighter travel restrictions.
A survey by consultancy Oliver Wyman found that 86% of Chinese consumers are willing to spend the same or more than during last year’s Singles Day festival.
“In the last six months or so, wealthy families have spent more money,” said Sean Shen, Ernst & Young’s strategy and customer competition leader in Greater China. “We also see that purchases of luxury products are increasing due to international travel restrictions.”
In 2018, Chinese consumers spent about $ 116.3 billion on luxury goods, representing about a third of global spending, and each luxury consumer household spends an average of $ 12,089, according to a McKinsey report from 2019 about luxury.
Sales of electronics and health and wellness products are also expected to rise as more people work from home and pay more attention to their health amid the pandemic, according to a report by consulting firm Bain & Co.
To help merchants cope with the consequences of the coronavirus, online platforms have extended the shopping festival period this year in hopes of boosting sales.
Both Alibaba and JD.com, the country’s two largest e-commerce companies, began offering discounts on October 21.
Tang Chenghui, an electrical engineer living in Beijing, sees Singles’ Day as an opportunity to stock up on imported snacks and products like milk from Australia. Before the festival, Tang pre-ordered three boxes of duck eggs, 10 packages of soy milk powder, two boxes of yogurt, coffee, and wine.
“I’m buying more snacks this year because I just moved into a new apartment and I have enough storage space to store the snacks I like,” Tang said. “Some of these products are really cheap during the Singles Day discounts.”
Unlike Black Friday and Cyber Monday in the US, Singles Day in China isn’t just about big business. Alibaba pioneered the Singles Day concept and holds an annual gala on November 11 with performances by celebrities to entertain shoppers.
E-commerce companies do not break down Singles Day sales volume by brand, so it is difficult to know which share goes to foreign companies, although some companies may advertise their own performances.
Sales via live broadcasts and Alibaba’s annual gala are part of a trend for “shopping entertainment”, combining shopping with entertainment to be more attractive and attractive to shoppers.
Mini-games within online shopping platforms attract shoppers with greater discounts and encourages them to spend more time within applications.
“Due to covid-19, brands and retailers have doubled down on e-commerce and livestream commerce to drive growth, and it will show up strongly in [Singles’ Day] this year, “said Wang Xiaofeng, a senior analyst at Forrester.
But while millions of shoppers spend hours playing minigames hoping for better bargains, some are upset about the complexities required to earn such discounts.
“Black Friday discounts tend to be better and easier,” said Liu Zhirou, a 27-year-old accountant from Beijing. “Now, I still ask my friends to help me buy things from America on Black Friday.”
“The rules around Singles’ Day discounts are getting more and more complicated,” he said. “I usually spend my money on Black Friday and buy less on Singles’ Day.”
Information for this article was contributed by Chen Si of The Associated Press.
Residents wearing masks to protect themselves from the coronavirus stand near an ad promoting the November 11 Sales Day in Beijing on Sunday, November 8, 2020. Chinese consumers are expected to spend tens of billions on everything, from fresh food to luxury items this year. Singles Day online shopping festival as the country recovers from the coronavirus pandemic (AP Photo / Ng Han Guan)
A worker cleans the surface of a luxury car as shoppers wearing a coronavirus mask visit a business district in Beijing on Sunday, Nov. 8, 2020. Chinese consumers are expected to spend tens of billions on everything from food. fresh to luxury items. during this year’s Singles Day online shopping festival as the country recovers from the coronavirus pandemic. (AP Photo / Ng Han Guan)
Residents wearing masks to protect themselves from the coronavirus walk past an ad promoting 50% of movies online during Sales Day on November 11, in Beijing, Sunday, November 8, 2020. Chinese consumers are expected to spend tens of billions on everything from fresh produce. food to luxury goods during this year’s Singles Day online shopping festival as the country recovers from the coronavirus pandemic. (AP Photo / Ng Han Guan)
A vendor talks to a shopper in a Beijing shopping district on Sunday, Nov. 8, 2020. Chinese consumers are expected to spend tens of billions on everything from fresh food to luxury items during the Beijing online shopping festival. Singles Day this year, as the country recovers from the coronavirus pandemic (AP Photo / Ng Han Guan)
A deliveryman walks past a Nov. 11 Sales Day ad in Beijing, China on Oct. 28, 2020. Chinese consumers are expected to spend tens of billions on everything from fresh food to luxury items during Singles’ Day online shopping this year. festival, as the country recovers from the coronavirus pandemic. (AP Photo / Ng Han Guan)
