Double 11 sales reach 120 bln yuan
World sees biggest online shopping spree
China’s e-commerce giant Alibaba Group Holding wowed the world with its record high sales during Singles’ Day, the world’s biggest online shopping extravaganza that falls every year on November 11.
By the close of trade, Tmall, Alibaba’s business-to-consumer platform, saw sales worth 120.7 billion yuan ($18 billion), a 32 percent increase year-on-year, meeting experts’ estimates.
Just seven minutes after the clock struck midnight, the Double 11 retail frenzy had already generated more than 10 billion yuan in sales. Last year, it took the site more than 12 minutes to reach the same figure.
The sales figures were projected on a giant screen at the Shenzhen Universiade
Sports Center, a stadium that can hold over 60,000 spectators, before Daniel Zhang Yong, the chief executive with the e-commerce behemoth, finished an opening address.
Tmall’s Double 11 shopping spree had reached more than 91.2 billion yuan in about 15 hours on Friday, exceeding last year’s total sales.
In comparison, sales on Cyber Monday, which is considered the biggest online shopping day in the US, hit $3.12 billion in 2015, data from US analytics firm ComScore Inc showed.
Globalization is a very important strategy for Alibaba in the next 10plus years, and “this year is a turning point for us to sell globally,” Zhang told the Global Times.
Analysts predicted that Tmall’s transaction volumes on November 11 this year driven by its “Buy Globally, Sell Globally” strategy would surpass the previous year.
Japanese fast fashion retailer Uniqlo was Chinese online shoppers’ most preferred overseas brand during the Double 11 shopping event, according to Alibaba’s cloud computing unit Aliyun based on the analysis of user data.
Currently, foreign buyers can buy goods via AliExpress, a wholesale site of Alibaba targeted at 243 countries and regions all around the world.
The “Buy Globally, Sell Globally” strategy was proposed by Zhang in late October as an upgrade for Ali- baba’s globalization plan, which was unveiled in 2014 to focus on adding foreign brands to woo Chinese consumers.
Now the Chinese e-commerce giant intends to become a venue on which brands from both China and abroad can reach potential buyers outside of the Chinese mainland.
The rollout of Tmall’s 2016 11.11 Global Shopping Festival in Hong Kong and Taiwan was seen as a way for the company to “test the waters” for its global expansion, according to a press release the company sent to the Global Times in October.
Hong Kong customers spent 2.3 million yuan on Tmall.hk in the first hour of Tmall’s shopping festival on Friday, while Taiwan online shoppers spent 2.2 million yuan on the Alibaba platform over the same period.
Alibaba declared in its press release that it is also looking toward Southeast Asian markets.
“Alibaba’s desire to ‘Sell Globally’ will take time to be fully realized, given its insufficient deployment of payment and logistics services abroad. Helping foreign shoppers become familiar with their channels and platforms also takes time,” Ma Jihua, a Beijing-based independent IT expert, told the Global Times.
“But it shouldn’t take too long, about two or three years,” added Ma.
Alibaba’s logistics arm Cainiao has inked partnerships with more than 50 cross-border logistics firms, which own 110 cross-border warehouses globally.
Alipay is also making aggressive inroads into other countries, and is now supporting payment services in regions including Russia, Brazil, Malaysia and Thailand.
Given such efforts, Alibaba might soon compete head-to-head against US tech giant Amazon on the world stage, analysts say.
Liu Dingding, also an independent analyst from Beijing, is concerned however that Alibaba’s ecommerce business, which was previously notorious for selling counterfeit goods, will experience headwinds from overseas authorities, as well as mistrust among foreign buyers who have grown used to shopping on Amazon.
In comparison with Alibaba, Amazon is a master of globalization and enjoys a better brand reputation as well as more powerful and stable cloud computing capabilities, Liu told the Global Times.
When asking about potential competition from Amazon, Zhang said that “the world market is very big, and we have a different DNA, focusing on helping merchants sell goods.”
New York-headquartered research firm eMarketer estimated in August that worldwide retail e-commerce sales will increase to $4.058 trillion in 2020, up from $1.915 trillion in 2016.