Chinese e-commerce giant Alibaba appears on pace to break its Singles Day sales record this year, highlighting China's recovery from the Covid-19 pandemic.
Early Wednesday morning, Alibaba said the Singles Day sales event has so far raked in $56.3 billion, showcasing China's success in addressing the Covid-19 pandemic. The sales number included the first 30 minutes of the event as well as an earlier three-day period which was added to boost sales following the pandemic.
Last year's sales and run up to 2020 event
Singles Day, also known as Double 11, is when Chinese e-commerce firms from Alibaba to JD.com offer large discounts over a 24-hour window.
At the 2019 event, Alibaba hit $31 billion in sales in just 16.5 hours, beating the 2018 record of $30 billion. the Chinese firm also mentioned that in its pre-sales three weeks prior to the 2019 Singles Day, Estee Lauder posted a record $143 million in pre-orders while Apple iPhone 11 pre-orders reached $14 million.
That year, Alibaba chief marketing officer Chris Tung said in an interview: "We continue to feel very confident about the growth potential of the economy. We are pushing deeper towards the less developed areas of China, to reach more new online shoppers, so there’s a huge untapped opportunity there."
Prior to this year's event, Alvin Liu, the president of Alibaba’s Tmall import and export business, suggested that most shoppers will not be shopping outside mainland China due to the coronavirus pandemic so they may opt to buy foreign goods at Singles Day 2020.
Chinese shoppers who would have typically purchased foreign brands during their holidays abroad are resorting to online shopping, he said. "I think the import product will have … big business this year for Singles Day,:" Liu said during an interview with CNBC.
He added: "As you know there is no global travel, so Chinese people stay within mainland China but they still prefer to buy all kinds of high-quality products overseas. I think Singles Day is the best timing for them to buy a lot of things."
2020 sales figures and China's recovery
Alicia Yap, managing director at Citigroup Global Markets Asia, mentioned that Alibaba added an extra three days of sales this year from November 1 to 3 because of the pandemic.
In a note last week, Yap explained that a few additional days of huge discounts help "brands or merchants recoup lost sales during the lockdown and [helps] global brands gain access to the stronger demand from Chinese consumers."
If sales from the earlier three-day period were included, Alibaba has already surpassed last year's Singles Day, where it sold $40.5 billion worth of goods, a growth of 25% year-on-year.
Citigroup expects Alibaba to grow its sales this year by up to 46% year-on-year to $59.4 billion and excluding the extra three days, sales would still increase by up to 24% to $50.3 billion.
Forrester analyst Xiaofeng Wang said: "China's economy has seen a strong recovery and Chinese consumers' purchase behaviors have already returned to pre-pandemic levels, if not higher."
An Oliver Wyman market survey revealed that 86% of Chinese consumers are willing to spend the same as or more than what they did during last year's Singles Day while the remaining 14% of the respondents said they will spend less because of uncertainty due to the pandemic.
