HK$12.6 billion in 6 hours: Chinese ‘Singles Day’ fuels world's largest shopping spree
China’s biggest online trading platform Alibaba Group was set to smash its own record for e-commerce spending on Monday after its annual sales promotion generated more than a colossal 10 billion yuan (HK$12.6 billion) in online transactions in just six hours.
Taobao and Tmall, two major online shopping websites run by Alibaba, recorded a staggering 340,000 sales transactions being completed within the first minute of the annual online shopping spree starting at midnight on Sunday, with the total value in spending surpassing 100 million yuan, according to news portal Sina.com. Within the first hour, the websites recorded 6.7 billion yuan worth of completed online transactions.
The International Finance News newspaper estimated that this year’s total in online sales could be somewhere between 50 and 80 billion yuan. By comparison, the International Business Times reported that online retail spending in the US on November 25, the country's biggest shopping day of the year known as ‘Black Friday’, last year recorded sales of US$1.04 billion (6.37 billion yuan, HK$8.06 billion).
November 11, widely referred to as “double eleven” in China, a day attributed to and celebrated by single people due to the shape of the Arabic numerals ‘11/11’, has over the years gradually become the most important date in the shopping calendar when e-commerce companies compete for profits by holding sales promotions to attract bargain-hungry customers.
A poll by Sina.com revealed that more than 60 per cent of respondents said they would shop online on “double eleven”, while only less than 15 per cent were certain that they could resist the sales. Of the respondents likely to shop for a bargain on “double eleven”, nearly 60 per cent said they would shop on the Alibaba platform, followed by electronic giant jd online shopping mall and Amazon, the latter two accounting for 19.5 per cent and 6.1 per cent respectively.
The two online shopping websites reported record-breaking sales of 19 billion yuan for last year’s shopping event on November 11, with Tmall pulling in 13.2 billion yuan and Taobao collecting 5.9 billion yuan.
Jack Ma, Alibaba’s founder and chairman, told the media before the sales that he expected this year’s transactions to top 30 billion yuan by the end of the day.
The number of transactions and sales volumes for other e-commerce companies were not immediately available. It is unknown how much exactly Alibaba will profit from sales this year, but the media estimated a profit percentage of 5 per cent of sales, which would give Alibaba an estimated profit of at least 1.5 billion yuan.
While Alibaba is well on its way to break its own sales record again this year, many attributed part of the success to Chinese premier Li Keqiang. Chinese media have focused on a meeting that took place just a week before the shopping spree where Ma, along with other entrepreneurs, was summoned for a meeting with Li on the subject of China’s economic outlook.
“This is totally unimaginable for traditional businesses,” official Xinhua news agency cited Ma as saying when he spoke of how Alibaba has slowly cultivated the ‘Singles Day’ into an annual shopping event over the past four years by promoting sales across its online shops, allowing it to record a total value of sales of 20 billion yuan last year.
When Li reportedly commented, “You have created a shopping spree,” many viewed it as an apparent endorsement of the promotion.
“What an advertisement Premier Li has made for Alibaba,” one comment read on the news portal Sina.com.