Date
12 December 2017
Alibaba said sales on its Tmall hit crossed 100 billion yuan within nine hours on November 11, compared with 10 hours to reach the same amount during the same event last year. Photo: Bloomberg
Alibaba said sales on its Tmall hit crossed 100 billion yuan within nine hours on November 11, compared with 10 hours to reach the same amount during the same event last year. Photo: Bloomberg

Alibaba, JD bicker over Singles’ Day sales

Chinese e-commerce giants Alibaba and JD.com are squabbling over their sales performance during the Singles’ Day. Alibaba said sales on its Tmall hit over 100 billion yuan within nine hours on November 11, compared with 10 hours to reach the same amount last year.

However, JD reported at 7:46 am on the same day that its sales already hit over 100 billion yuan, conveying the impression that the firm achieved the sales mark one hour earlier than its bigger rival.

Wang Shuai, Alibaba’s top PR official, then said in a video that “JD can count its full-year sales as Single’s Day if it wants to. It has changed the methodology of its calculation for the seventh time in recent years. A good accountant is the only thing JD needs to exceed Tmall.”

Wang’s comments are fairly valid. JD started its sales event on November 1 and combined 11 days of sales. By contrast, rival Alibaba reported its one-day sales on November 11. Therefore, the figures published by Alibaba and JD are not comparable.

In response, Xu Lei, JD Group’s chief marketing officer, said in a WeChat post that “if one can start pre-selling more than 20 days before, why we can’t count 11 days of sales as the total sales for the shopping event. It’s not a question of math, but a question of logic.”

Xu refers to a pre-sales campaign Alibaba launched since late October, under which buyers could deposit some amount in order to obtain a discount on Single’s Day. The move has been applauded as it helps reduce delivery bottlenecks and give more time for sellers to stock up best-selling products.

JD argued that if Alibaba took more than 20 days to promote Single’s Day in the pre-sale, it’s fair for JD to include the run-up to Single’s Day as total sales figure.

Alibaba said its one-day sales reached 168.3 billion yuan, up 39 percent from last year. Meanwhile, JD’s sales for Singles’ Day – including sales notched during the run-up – reached 127.1 billion yuan, marking a record high.

The Singles’ Day shopping event was created by Alibaba in 2009. JD, meanwhile, has started its own shopping festival to celebrate its June 18 anniversary. During the so-called 6.18 festival this year, the company reported 119.9 billion yuan in sales between June 1 and June 18.

Both the companies have generated significant sales from the shopping events. However, they are facing unprecedented competition in the domestic market. It’s reported that business-to-customer e-commerce sales in China surged 44 percent to 254 billion yuan on Single’s Day this year. Alibaba and JD accounted for 66.2 percent and 21.4 percent respectively. However, both have seen their market shares slip a little compared to last year, when they accounted for 68.2 percent and 22.7 percent respectively.

The two e-commerce giants have together lost 3.3 percent market share this year. More entrants have joined the competition amid well-developed market infrastructure like mobile payments and logistics.

Many new-emerging e-commerce rivals have been focusing on niche market segments, such as cosmetics, women’s shoes, snacks, automobiles, etc. The new entrants have managed to divert some user traffic from Alibaba and JD.

This article appeared in the Hong Kong Economic Journal on Nov 17

Translation by Julie Zhu

[Chinese version 中文版]

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BN/RC

Hong Kong Economic Journal columnist

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