China’s biggest online shopping bonanza wraps up on Monday, with analysts and investors looking for signs that spending is picking up in the world’s second-largest economy after Beijing’s latest efforts to boost activity.
“Singles’ Day” — started by tech giant Alibaba in 2009 — has entered the annual sales season, with days of discounts luring customers to the country’s online shopping platforms.
Its name is a four-part riff on its date of November 11, or “11.11” — a linguistic celebration among singles that is a key driver of sales for Alibaba and its biggest competitor, JD.com.
Neither company has released detailed sales figures for last year’s Singles Day for the second time running, with Alibaba only saying it recorded growth this time around.
Excessive domestic consumption is among the main issues now facing policymakers in China, which has struggled to fully recover from the pandemic.
Beijing in recent weeks has announced a number of the most aggressive measures in years aimed at boosting growth, including key rate cuts and raising debt limits for local governments.
But many economists argue that without significant fiscal stimulus aimed at encouraging consumer spending, a return to the country’s strong pre-pandemic situation may be difficult to achieve.
This year’s Singles Day could represent a major boon for supermarkets as analysts look for signs that the latest measures are having an impact.
Analysts at banking group ING said in a paper last week that they expected to see “strong growth numbers” during the event, which they said “should comfortably exceed the pace of consumption growth”.
Consumer prices in China rose at the lowest rate in October, official data showed Saturday, in another sign of languid demand.
Singles Day 2024 “is expected to generate more than 1.2 trillion yuan ($167 billion)… representing a 15 percent increase compared to last year”, writes VO2 Asia Pacific, an economic consultancy digital.
While promotional campaigns can be effective for short-term purchases, managing partner Vincent Marion cautioned that the strategy could backfire.
“Many consumers buy in bulk to get a discount, then return products afterwards,” Marion said, warning that this practice “erodes profit margins and damages brand image”.
Alibaba, like its biggest rival JD.com, withheld sales figures for Singles Day for the first time in 2022, saying instead that sales were lower than last year.
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