Major Chinese e-commerce platforms have kept quiet on the gross merchandise volume (GMV) figures for the month-long 618 shopping festival, a key indicator of success in years past. JD said the event “exceeded expectations and set a new record,” while Alibaba’s e-commerce group said it saw users’ willingness to spend more time browsing on Taobao as their “greatest achievement” from this year’s festival.
Why it matters: Third-party data provider Syntun said total sales during 618 from Tmall, JD, and Pinduoduo increased 5.4% from a year prior to RMB 614.3 billion ($85.6 billion), signaling that China’s consumption growth is on a slower pace than expected, as consumers spend their money more cautiously.
Details: The mid-year shopping festival is still a major event to observe changing consumer trends and tastes. According to various surveys, this year’s event shows that livestream shopping has become increasingly influential in consumers’ shopping decisions.
- Data produced by Syntun shows that the cumulative sales generated from live commerce platforms including Douyin and Kuaishou reached RMB 184.4 billion during the 618 period, representing a 27.6% year-on-year increase.
- According to a survey conducted by local media outlet Yicai involving approximately 400 respondents, nearly two-thirds stated that they primarily shopped on livestreams.
- Alibaba’s Taobao saw its daily average number of views of short videos on the platform surge by 113% compared to the same period last year, while the number of active influencers grew by 200%.
- Low cost was another major theme emphasized by e-commerce platforms during this 618, as businesses offer discounts to boost sales.
- A survey conducted by the media outlet Southern Metropolis Daily also revealed that consumers have varied ideas of what constitutes low cost. Close to 60% of respondents believe that it refers to products with ultimate cost-effectiveness, where the brand, quality, or after-sale services are superior despite the product having a comparable price. One-third of respondents consider it the lowest price for the same item across all platforms, while 11.5% perceive it as products priced at an absolute minimum, such as goods costing RMB 9.9.
Context: JD recorded an overall transaction volume of RMB 379.3 billion during last year’s 618 festival. However, its annual growth of 10.3% was a new low, slowing from the previous year’s 27.7% increase.
- Chinese retail sales grew by 12.7% year-on-year in May, according to data released by the National Bureau of Statistics, lower than the expected 13.6% and also lower than April’s 18.4%. Fu Linghui, a spokesperson for the bureau, stated that retail sales showed a “stable growth momentum,” and any growth rate decline was mainly due to starting at a higher base than the previous year.