China’s equivalent to America’s Cyber Monday is over, and e-commerce giant Alibaba, the operator of China’s top online marketplace, is celebrating the world’s biggest online shopping day ever.
The final tally isn’t in yet, but with Singles Day partial sales figures topping US$5.78 billion in just 24 hours, sales have already dwarfed online shopping records for Cyber Monday and Black Friday combined.
At a glance, deals on apparel, jewelry, electronics, household wares and even cars, ranged from a humdrum 10 percent off to a totally insane 90 percent off.
According to Tech In Asia, the sales on Alibaba’s Tmall involved more than 20,000 merchants. That massive US$5.78 billion figure counts only Tmall customers who paid via the company’s own Alipay (like Paypal), so the total spending amount will be higher once all payment methods are tallied. (Alibaba doesn’t sell merchandise but offers a sales portal for vendors through Tmall and Taobao.)
Other online marketplaces including Jingdong and Tencent-owned 51Buy also expected record-breaking numbers.
Singles Day, a modern twist on Valentine’s Day, is China’s excuse to shop — all a buyer needs is internet access and a credit card. It is celebrated on November 11, a date selected because it consists of four “ones” (or singles, get it?).
Singles’ Day was invented by students in the 1990s, according to the Communist Party-owned People’s Daily, which said the date (11-11) is reminiscent of the Chinese phrase “bare branches” for bachelors and spinsters.
“Unattached young people treat each other to dinner or give gifts to woo potential partners and end their single status,” said Malcolm Moore, China correspondent for The Telegraph.
For online retailers the event has evolved into the biggest day of the year and a long day for couriers delivering packages to online shoppers around the country. (Most places offered free shipping.)
China’s delivery companies had 800,000 employees working on Monday, including 65,000 temporary workers hired for the day, Moore noted.
The Next Web reported that the event got off to a strong start when it launched at midnight in China. In the first six minutes, consumers spent more than 1 billion yuan (US$164 million), as recorded by transactions made on Alipay, a milestone that took 37 minutes to hit last year. Within the first hour, Alipay had racked up more than 6 billion yuan (nearly US$1 billion) in transactions, with the fashion category making up about half of the sales.
“Crazy”, wrote People’s Daily on its Weibo microblog account.
To spice things up, Tmall’s PR department served some “interesting” real-time statistics. Two of my favorites:
• In the first hour of the sale, a total of 2 million pieces of underwear were sold. If laid out end-to-end, the conga line of tighty-whities would stretch for 3,000 kilometers.• Enough bras were sold in the first hour that if stacked up, they would form a pile taller, and arguably more alluring, than three Mt. Everests.
Last year, revenue from online sales in China was between US$190 billion and US$210 billion, a close second to the US market, worth US$220 billion-US$230 billion, according to research by McKinsey. And China’s market is growing much faster.
China’s market had compound annual growth of 120 percent between 2003 and 2011, compared with 17 percent growth in the US over that time. McKinsey forecasts that China’s market could reach US$420 billion-US$650 billion by 2020.
For the record, Amazon reported revenue of US$17.1 billion in the third quarter, or about US$4.3 billion a month.
The privately held Alibaba, based in Hangzhou, reported US$170 billion in 2012 sales, more than competitors Amazon and eBay combined.
Ray Kwong is a China commentator. He writes on China for Forbes. He is also a China business development strategist and marketing consultant.
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