Local brands popular on Singles' Day

Local brands popular on Singles' Day

Hundreds of millions of young Chinese shoppers are inclined to purchase high-quality domestic brands, especially those that feature fashionable and creative designs mixed with elements from traditional Chinese culture. In its 15th year, Singles' Day, or 11-11, shopping extravaganza, initiated by Alibaba Group on November 11, 2009, remains the world’s biggest online shopping event. This year’s festival has seen major e-commerce platforms provide steep discounts and low-priced products to boost sales.

Tmall, Alibaba Group’s business-to-customer platform, said that 402 brands, including 243 domestic ones, saw their sales surpass CNY100 million from 8 pm on October 31 to midnight on November 11. The turnover of 38,000 brands surged more than 100% year-on-year during this period. Neither Alibaba nor JD disclosed specific gross merchandise value (GMV) figures for this year’s shopping spree. Alibaba said only that the scale of users and merchants registered “remarkable” growth. JD said its transaction volume, order volume and user engagement “reached record highs”. The sales of over 60 brands surpassed CNY1 billion, and nearly 20,000 brands witnessed their turnover increase threefold year-on-year over the weeks-long promotion gala. Young Chinese consumers increasingly opt for high-quality homegrown brands, with the spending from the post-1990s and post-2000s generations accounting for 62% of the total sales of domestic brands, it added.

Turnover of high-end electronic devices surged on JD, with foldable smartphones up 300%, digital cameras 100%, and gaming laptops 50%. Jason Yu, General Manager of Kantar Worldpanel China said that Chinese consumers were more value-conscious this year. “They hope to buy cost-effective commodities, rather than just obtaining low-priced goods at the cost of quality.” China’s consumption market recovered in the first three quarters of this year.

A total tally of sales on all Chinese e-commerce platforms is usually not available, but various global consultancies often release estimates after the shopping festival concludes. Sales for last year's “Double 11” reached CNY1.15 trillion, according to a recent report from U.S. consultancy Bain, more than four times the USD35.3 billion U.S. shoppers spent during Cyber Week from Black Friday to Cyber Monday. For this year, some global consultancies have made forecasts for a total GMV growth of between 14% and 18%, which would mean a return of double-digit sales growth for the first time since the Covid-19 pandemic.

On November 11, a record 639 million parcels were processed, the State Post Bureau of China said. The volume was 1.87 times that of regular days, with a year-on-year increase of 15.76%. More than 5.26 billion parcels were handled between November 1 and 11, an increase of 23.22% compared with last year. During this time, the average daily volume was 1.4 times that of off-peak days. This year, most online stores offered big sales on two days, November 1 and 11, with discounts and coupons on offer on the days in between. As of October, China handled more than 100 billion parcels this year. In 2013, the annual figure was less than 9.2 billion.

Data from Tmall, Alibaba’s business-to-customer e-marketplace, showed that in the first hour of this year’s 11-11 presale, which kicked off at 8 pm on October 24, sales of more than 20 domestic brands exceeded that of the entire day last year. According to Tmall, the transaction volume of more than 70,000 domestic brands doubled on October 31 when the official promotional sales began and 85 Chinese brands saw sales surpass CNY100 million in just a brief period. JD began its presale promotion at 8 pm on October 23 and saw sales of domestic smartphone brands, such as Xiaomi, Honor, Huawei, Oppo and Vivo, exceed CNY100 million within just one second.

According to a survey by AlixPartners, Chinese brands continue to gain momentum, as 66% of interviewed consumers said they plan to increase spending on domestic brands. The survey, with a sample size of over 2,000 consumers across different age groups and regions in China, found that consumers are increasingly looking for local alternatives with “more bang for the buck” as Chinese product quality and safety improve. This is particularly true for young shoppers purchasing clothing brands and accessories, as 61% of the respondents aged between 18 and 25 planned to increase spending on Chinese-branded clothing, fashion items and accessories during year, the highest among all product categories and age groups.

Domestic brands are continuously strengthening their technological innovation and expanding their presence in the high-end market, Yu of Kantar Worldpanel said, adding brands should pool more resources into R&D to enhance product competitiveness and upgrade supply chains.

China’s consumer market recovered in the first three quarters of this year. Retail sales grew 5.5% year-on-year in September compared with 4.6% in August. In the first nine months, they increased 6.8% year-on-year, according to the National Bureau of Statistics (NBS). Consumption contributed 83.2% to China’s economic growth during the January-September period.

This overview is based on reports by the China Daily and the Global Times.