China’s mid-year e-commerce sales festival failed to stir up a great deal of excitement among shoppers, industry experts said, even as major platforms extended offers to a weeks-long period to woo belt-tightening consumers amid a gloomy economic outlook.
The 618 festival, named after the June 18 founding date of e-commerce provider JD.com Inc (京東), but embraced by all platforms, is China’s second-biggest annual sales event after Singles Day in November and a key test of household consumption appetite.
“With discounts available year-round, buzz around 618 has diminished,” WPIC Marketing + Technologies chief executive officer Jacob Cooke said.
Photo: Reuters
“But the festival is still generating a GMV bump from baseline and overall GMV should be up slightly from 2023,” he said, referring to gross merchandise volume, a widely used proxy for e-commerce firms’ online sales.
JD.com yesterday said that its turnover and order volumes reached a new high over the festival period, which ran from the end of last month to Tuesday. It did not elaborate on the exact growth rate of its orders or sales during the festival, which was first launched in 2010 as just a one-day sale.
Data from consultancy Syntun (星圖數據) showed that China’s total online sales volume fell 7 percent year-on-year to 742.8 billion yuan (US$102.4 billion) during this year’s 618 festival.
Major players such as JD.com and Alibaba Group Holding Ltd’s (阿里巴巴) Tmall (天貓) and Taobao (淘寶) e-commerce platforms this year canceled a traditional pre-sale period in which shoppers could place deposits on products and complete the purchase during a later sales period. Instead, the sales period itself was extended.
That extension, combined with China’s broader consumer belt-tightening, which is pushing retailers to constantly focus on low prices, also contributed to 618 garnering less enthusiasm than the event once enjoyed, analysts said.
An analysis by consultancy Re-Hub of luxury brand discounting strategies during this year’s 618 festival found that nearly half of the brands they tracked either maintained or reduced their average discounts from the previous year, while 20 percent increased their average discounts.
Alibaba had previously flagged in a mid-618 season update that sectors such as home appliances were outperforming on its platforms, led by brands such as Haier Group (海爾) and Xiaomi Corp (小米).
The e-commerce giant yesterday said that international brands, including Nike Inc, L’Oreal SA, Lancome and Adidas AG, surpassed 1 billion yuan of sales on Tmall during the period.
Apple Inc offered discounts of up to 2,300 yuan on select iPhone models via its Tmall flagship store in a bid to keep pace with domestic competitor Huawei Technologies Co (華為).
Within the first hours of sales, Alibaba said Apple had sold more than 200 million yuan of merchandise.
Given low prices are now such a common feature of China’s consumer landscape, it is becoming more difficult for e-commerce platforms to keep customers engaged — even with traditionally successful sales festivals.
“I haven’t been paying constant attention to 618, to be honest, because there are just so many [shopping festivals],” said Anita Meng, a university student from Hangzhou.
“Even if these festivals are still going strong, my wallet is already exhausted,” she said, adding that she only made one purchase this 618 — a gaming chair for her older brother that was reduced from more than 1,200 yuan to 1,000 yuan.
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