Singles Day and its Impact on E-commerce Giants
Singles Day is the largest shopping event in the world and only this fact is enough to understand its importance to e-commerce giants. JD.com, as well as Alibaba, set new sales records across their platforms on Singles Day.
Both companies sold a lot of products despite worries about the strength of the Chinese consumer. Another issue was China’s crackdown on technology companies.
Singles Day, also called Double 11 transformed over the years. It transformed into a multi-day extravaganza, ending on November 11. E-commerce giants pay a lot of attention to this event. JD.com began sales in later October while its rival Alibaba started at the beginning of November. This extended period helped e-commerce giants continue to grow sales.
E-commerce giants and Xi Jinping
E-commerce giants make a lot of money on a regular basis. However, even they can’t ignore Singles Day and why should they?
The company founded by Jack Ma said gross merchandise volume (GMV) during the 11-day period totaled 540.3 billion yuan ($84.54 billion). In 2020, GMV was 498.2 billion yuan. Transaction volume on JD.com’s platform reached 349.1 billion yuan ($54.6 billion) during the Singles Day period.
It is true that gross merchandise volume and transaction volume don’t translate into direct revenue for JD.com and Alibaba. Furthermore, they don’t account for returned items. They relate to the volume of transactions across both their platforms. The figures, nonetheless, indicate Chinese consumers’ appetite to shop on their platforms. According to JD.com, it saw a surge in purchases of luxury products and pet-related goods.
In spite of the big sales numbers, Singles Day was a slightly more muted affair this year. E-commerce giants and other companies continue to face intense scrutiny from regulators. President Xi Jinping wants to tackle inequality. He also pushed for so-called common prosperity or moderate wealth for all.
Alibaba and JD.com embraced social and environmental responsibility during the event, aligning themselves with the priorities of Beijing. Compared with last year, JD.com reduced carbon emissions by 26,000 tons during this Singles Day.
E-commerce giants are trying to find new customers. Both of them said they saw growth in smaller Chinese cities, a key focus for e-commerce companies as they look to grow their user bases. In the case of JD.com, users from so-called lower-tier markets accounted for 77% of all shoppers during the Singles Day period.
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