Alibaba Singles’ Day breaks sales record, rakes in $18 bn in 13 hours
Ali ba ba Group Holding Ltd’ s Singles’ Day shopping bonanza broke last year’ s all-time high of 120.7 billion yuan ($18.2 billion) by 1:09p min Beijing, with about 11 hours still togo before the final bell.
The annual frenzy had already hit $8.6 billion in sales in the first hour after starting at midnight, and by 8 am some 82 brands had topped 100million yuan in sales, including New Balance, Samsung and Sh isei do, according to A liz ila, a blog run by the company. More than 90 percent of transactions were done via mobile.
Shoppers from at least 192 countries and regions swarmed thee-commerce giant to scoop up discounted lobster, iPhones and refrigerators, at a rate of as many as 256,000 transactions per second. The Chinese company hosted a star studded gala with tennis star Maria Shara po va and American rap per P harrell Williams to pump sales.
Ci ti group Inc has predicted transactions will rise by more than 30 percent to 158 billion yuan this year. While that’ s only half the growth rate last year, the event still dwarfs others such as Black Friday and Cy ber Monday. Billionaire founder Jack Ma is using it as a testing ground for his plans to rev amp China’ s $4- trillion traditional retail sector with technology, an experiment that could help the behemoth gain an edge in China’ s saturated market.
“The work that’ s been done in the integration of offline and online, not justin terms of the technology integration, but the data and efficiencies for brands and the consumer through personal is at ion has been enormous ,” Ali ba ba President Mike Evans said in an interview on
Bloomberg TV. “We see the impact of it in our day-to-day business.”
The date of November 11 emerged as a counter-cultural antidote to the sentimentality of Valentine’s Day. It takes its name from the way the day is written numerically as 11/11, which resembles “bare branches ,” a local expression for the unattached.
Shopping bonanza
Now, it’ s become an excuse for people to shop and bin ge on entertainment shows. Hangzhou-based Ali ba ba is using the occasion to test the limits of its cloud computing, delivery and payments units— businesses that could benefit from roping in traditional retailers as customers.
To that end, Ali ba ba teams fan ned out across the nation before the event to help outlets—some 600,000 mom-and-pop convenient stores and about 1,000 brands—upgrade their computer systems. Those retailers, many in prime city locations, will become delivery and storage centres. To connect a 10 th of China’ s six million convenience stores to the Internet, Alibaba uses an a pp called Ling Shou Tong, meaning “connect retail .” Convenience stores are given suggestions on what to pro cure and how to display merchandise. The goods are shipped from dedicated Ali bab aware houses, obviating middlemen. In theory, that improves their profit.
The company is also converting 100,000 retail outlets into so-called smartstores. Brands including Levi sand L’ O real are taking part. If one shop runs short of certain inventory, customers can track availability at other locations. They can also get goods delivered to their home.
Rivalry with Amazon
It’ s early days in Ali bab a’ s grand retail experiment, but if it works, it could dee pen a lead over Jeff Bez os’ Amazon. com Inc in the fragmented world of physical retailing. Ma’ s company spent billions buying into grocers, shopping mall sand even department stores years before Amazon announced its $13.7- billion acquisition of Whole Foods Market Inc. Ali ba ba is already starting to see the initiative trick le into the top line. Revenue from new retail—mainly its He ma super markets and In time department store—more than quintupled in the September quarter. As with convenience stores, Ali ba ba is trying to franchise the He ma model that combines a supermarket, restaurant and fulfillment centre ina single location on its technology platform.
The company recently bought control of unprofitable delivery business Cainiao Smart Logistics Network Ltd. It oversees a cot erie of more than a dozen shipping partners, orchestrating deliveries carried out by millions of people across more than 600 cities. Ali ba ba has said Ca in iao expects 3 million people to handle packages duringthe24-hour-period.
“On the back of 11-11, we will probably have to distribute north of 700 million packages ,” Evans said .“That is a massive, massive number of packages that requires a robust logistics network both in China and outside of China, and we will continue to invest in that business, and by moving to a controlling position, we will be able to ensure the right degree of quality .”
The annual frenzy had already hit $8.6 billion in sales in the first hour after starting at midnight, and by 8 am some 82 brands had topped 100-million yuan in sale