Alibaba, the famous Chinese e-commerce giant, said on Saturday, 11 November that, its Singles’ Day sales has hit $25.4 billion. Alibaba broke its own record from last year and has made this event, the world’s biggest shopping event to happen till date.
Once this day was a celebration for China’s lonely hearts, it has now become an annual 24-hour buying frenzy. Single’s day exceeds the combined sales for Black Friday and Cyber Monday which are similar very popular events in the United States.
By midnight, Saturday, Alibaba’s ticker of live sales registered 168.3 billion yuan of sales. This was up by 39% from 120.7 billion yuan that Alibaba registered last year.
This event had begun soon after an event in Shanghai in late night Friday. As soon as the midnight hit, a shower of pre-orders helped in driving a billion dollars of sales on Alibaba’s sales platforms in the first two minutes only and over $10 billion in just an hour.
This event each year gets shoppers around China who scout for bargains and load up their online shopping carts, all the while delivery men & robots brace themselves for an estimated 1.5 billion of parcels which are expected to be delivered over the next six days.
Joseph Tsai, Alibaba’s co-founder and vice chairman, said that, this is a big event for China and for the Chinese economy. He said that Singles’ Day shopping is more like a sport and very entertaining in its process.
Tsai said that rising disposable incomes of over 300 million middle-class Chinese consumers is helping in driving the company’s online sales and would continue to do so.
The final total of sales which is more than the GDP of countries like Iceland, leaves other shopping days behind. Cyber Monday in the US covered ‘only’ $3.45 billion in online sales the previous year.
Investors have closely watched the headline number, though according to some analysts it might have discrepancies. The U.S. Securities and Exchange Commission had launched a probe into Alibaba’s accounting practices the previous year, including into its Singles’ Day data. This investigation is still ongoing.
At Alibaba’s Friday night gala, the company hosted popular guests including the actress Nicole Kidman, famous singer Pharrell Williams and a few Chinese musicians and film stars such as Fan Bingbing and Zhang Ziyi.
This excitement around the shopping gala, however, masked the challenges that currently face China’s online retailers. The Chinese giants nowadays have to spend more to compete for online shoppers in a broader economy because of slower growth.
Alibaba has said that, it had turned over 100,000 physical shops around China into “smart stores” only for this year’s event. Goods checked out by people at the stores, then bought & paid for on Alibaba’s platforms, were also added in the sales total.
Online retailers are now being forced to make way offline as well as overseas to attract new shoppers, and the online retail market is now close to saturation. This raises questions about whether the current rapid growth could be sustained for a period of time.