On November 1, 2024, around Double 11, employees of an e-commerce company were packaging express packages in Lianyungang City, Jiangsu Province, China.
VCG | Visual China Group | Getty Images
BEIJING – Early indicators from China’s biggest shopping event of the year showed a pickup in sales in some categories amid expectations for relatively modest overall sales growth.
China’s version of “Black Friday” kicked off on October 14, more than a week earlier than last year Alibaba and Jingdong Coping with tepid consumer spending. The shopping festival, also known as Singles’ Day or 11.11, has evolved into a multi-week promotional period in recent years since it was launched by Alibaba on November 11, 2008.
“The GMV growth we’re seeing so far is going to be a little bit better than last year,” Jacob Cooke, co-founder and CEO of WPIC Marketing + Technologies, told CNBC. Thursday. The company helps foreign brands such as Vitamix and IS Clinical sell online in China and other parts of Asia.
GMV refers to gross merchandise value, an industry indicator that measures sales over a period of time. During the epidemic, Chinese e-commerce giants stopped reporting Double Eleven GMV in 2022. Alibaba said its GMV grew 8% in 2021, while JD.com grew 28%, totaling more than $139 billion.
According to data, as of October 30, this year’s Double Eleven GMV was 845 billion yuan (US$119.1 billion) Research company Syntun. It’s unclear how GMV will compare to 2023, given the extended promotion period this year.
About 80%, about US$95 billion, comes from Alibaba, JD.com and PDDSyntun’s report shows that nearly 20% is generated through the live sales platform Kuaishou and ByteDance’s Douyin.
While Double Eleven GMV is no longer growing at 30%, Cook said he expects growth this year to be about 15%, which is better than the 11% growth in 2023, when the festival lasted 19 days.
“The experience-based thing is starting to do really well, and it’s less about Louis Vuitton luxury and more about lululemon, which is what we’ve been saying for a while,” Cook said. “It’s just consumer habits. Changes have indeed taken place.”
Subsidies boost home appliances
Helping boost Double Eleven sales is China In late July, a home appliance trade-in subsidy was launched. Since late September, Chinese authorities have begun stepping up stimulus efforts, lowering existing mortgage rates and signaling further support.
“We believe this year’s 11.11 festival will be a pivotal point and will reflect the recovery trajectory in the third and fourth quarters of 2024,” UOB Kay Hian analysts said in a note.
They predict that with the support of the trade-in program, sales of the home appliance category will achieve a 4% to 5% growth in GMV on Double Eleven.
Alibaba said that driven by government subsidies and platform benefits, home appliance pre-sales in the first hour of October 14 increased more than seven times compared with the first hour last year.
JD.com said that between October 14 and October 31, the transaction volume grew by double digits Compared to the same period a year ago. The company claimed record sales of consumer electronics and home appliances, but did not disclose specific figures.
“Since the beginning of this year, the price war on e-commerce platforms seems to have generally slowed down, returning to a certain degree of rationality after fierce price competition,” Oliver Wyman partner Xie Wei said in a statement. He also noted Beijing’s stimulus package and a recovery in consumer confidence.
“In the early days of Double Eleven, categories such as home appliances and consumer electronics, outdoor products, beauty products, and pet products all performed well,” Xie said.
“Micro” shopping trends
A consumer trend emerging this year is toys and collectibles, often from games or popular animated series. This category is often called IP in China.
“A lot of international brands have been fighting for permission to come in here and do this,” Cook said.
“There’s always a micro-trend every year on 11.11, and that seems to be the case this year,” he said. “Something comes out of nowhere and suddenly becomes a very, very big number.”
Liang Yuke, a designer and representative of the collectible toy category at the company, said that this year’s Double Eleven, more than 100,000 licensed products based on more than 1,000 characters will be launched on Alibaba’s Tmall, such as “Genshin Impact” and “Arknights.” Products include collectible cards, statues and clothing.
The category also includes Lego and British toy company Jellycat, which launched a Valentine’s Day stuffed dog in China for Singles’ Day, Liang said. She said the 7,000 dogs, which sold for about $50 each, were snapped up within seconds.
Japanese manga Chiikawa opened a Tmall store in late September, and more than 100,000 shoppers simultaneously ordered $9.72 items “Limited edition plush toys,” Liang said.
Liang said Taobao and Tmall began developing the IP category in 2017 and promoted it to one of the few first-tier market segments in terms of product promotion and business priority in 2021. She said most buyers are in their early thirties or younger and prefer to buy products believed to bring happiness or other emotional satisfaction.
Emotions ‘much calmer’
Despite this growth, China’s Singles Day remains more subdued than in previous years.
“The mood this year is much different and much calmer,” wrote Ashley Dudarenok, founder of Chinese marketing consultancy ChoZan. “Chinese consumers are not caught up in a ‘buy, buy, buy, buy, buy, buy, buy, buy, buy, buy, buy, buy frenzy’; they are looking for the more expensive items they really need. products, not just lower prices.”
She predicted that this year’s Singles Day might be “slightly better” at best, driven by different categories.
The shopping promotion officially ends on November 11th.
James Yang, head of retail for Greater China at consulting firm Bain & Company, said the company’s expectations for this year’s Singles’ Day are “low”, continuing a trend of the past two years.
JD.com is scheduled to release quarterly results on November 14, and Alibaba is scheduled to release its financial report on November 15.
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