Festival Therapy

Midyear online shopping bonanza shows potential of domestic consumption

China’s largest mid-year online shopping festival 618, deriving its name from its culmination on June 18, has helped businesses make a strong comeback after they suffered from waning consumption earlier this year due to the novel coronavirus epidemic.

Bestore Food, a snack food retailer headquartered in Wuhan, Hubei Province in central China where the epidemic caused the most disruptions, had seen its offline businesses wilt. But it regained growth momentum by driving online sales. Then the mid-year shopping festival, lasting from June 1 to 18 with pre-sale promotions in May, saw it make up its losses further.

The company said its sales during the shopping spree exceeded 500 million yuan ($70.7 million). Its online store on e-commerce giant Jd.com’s platform increased 54.7 percent year on year. Total sales were on par with the volume during Double 11 last year, the other major shopping carnival held on November 11.

Live-streaming and short video platforms became the key channels for expanding online sales during the mid-year shopping event, Zhao Gang, Vice President of Bestore, told Digital Marketing magazine.

“Though I had not planned to buy anything at first, the snacks Bestore showed in their livestreaming looked so delicious that I couldn’t help but splurge on them, especially as I had some coupons,” a netizen called Jelly posted on Weibo, the popular Chinese social media platform.

Shopping frenzy

The 618 festival was started by Jd.com in 2010 and has become as popular as Double 11 initiated by another e-commerce giant, Alibaba. For e-commerce retailers, 618, the first large-scale shopping festival since the novel coronavirus outbreak this year, was a major opportunity to boost sales. With people still staying indoors and making online purchases to prevent another outbreak, sales on e-commerce marketplaces saw robust growth during the promotion. The Chinese consumption market once again showed its potential.

China’s e-commerce giants set new sales records. With pre-sale volumes surging 515 percent year on year within the first hour, Alibaba’s online marketplace for branded goods, Tmall, saw deals totaling 698.2 billion yuan ($98.6 billion). Jd.com recorded 269.2 billion yuan ($38 billion) in orders during the promotion, up from 201.5 billion yuan ($28.5 billion) last year.

Xu Hongcai, Deputy Director of the Economic Policy Commission, China Association of Policy Science, told Beijing Review the demands of indoor consumption as well as consumption coupons distributed by local governments and discounts offered by the e-commerce platforms increased people’s enthusiasm during the festival. Data from Chinese online payment clearing house Netsunion

Clearing Corporation showed 26.18 billion transactions worth 16.91 trillion yuan ($2.38 trillion) were made from June 1 to 18, up 52 percent and 42 percent respectively from last year. The number of transactions on June 1 hit nearly 1.6 billion, a single-day record.

More than 100,000 brands signed up for the event on Tmall, double the number last year. National stores launched and operated by the governments of nine countries, including Russia, Singapore and Thailand, also participated in the event for the first time, Alibaba told Global Times.

To attract more customers, many ecommerce players, including Alibaba, Jd.com, Suning.com and Pinduoduo, offered discounts and coupons. Jd.com offered 50-percent dis

Pre-sale volumes

surged

(y.o.y.) within an hour this year.