Gross domestic product grew by 4.9 percent in the third quarter after a 3.2 percent expansion in the March-June period.
Chinese e-commerce giant Alibaba Group Holding Ltd said orders made during its Singles’ Day mega-shopping festival had exceeded $56bn by Wednesday morning, as consumers sought to cash in on a deluge of discounts.
This year’s shopping extravaganza comes a week after Alibaba lost almost $76bn of its market value following China’s suspension of the $37bn listing of Ant Group, the financial technology firm which Alibaba owns a third of.
It also takes place as China experiences an economic rebound after getting the spread of the novel coronavirus under control within its borders, following the virus’ emergence in the central city of Wuhan late last year.
Alibaba launched the annual online blitz early this year, with two primary discount periods taking place from November 1 through November 3 and again on November 11.
The company will calculate gross merchandise volume (GMV) over the full 11-day period, as opposed to the usual 24 hours.
As of 12:30am local time (16:30 GMT) on November 11, the campaign’s GMV had surpassed 372.3 billion Chinese yuan ($56.3bn) with the order rate hitting a record peak of 583,000 per second, Alibaba said.
Alibaba, Asia’s largest company, blew past last year’s record $38bn at the beginning of Singles’ Day.
Pop star Katy Perry, who has performed at the event before, made an appearance at the company’s gala late on Tuesday, albeit via a livestream, as travel restrictions on outside visitors remain in place in China.
Chinese consumers – who already buy about 30 percent of the nation’s retail purchases online – have become more reliant on e-commerce.
Homebound consumers turned grocery delivery into the industry’s hottest arena, anchoring an unprecedented surge in online activity during the nationwide lockdown. Domestic travel is accelerating, propping up Alibaba businesses such as Fliggy, while a raft of new smartphones launched during the quarter is expected to tap pent-up demand for electronics.
Alibaba has said it is introducing more than two million new products, double last year’s amount. Other companies such as Douyin – the Chinese version of Beijing ByteDance Technology Co Ltd’s TikTok – JD.com Inc and Pinduoduo Inc are also holding their own Singles’ Day shopping events.
JD.com, which started its shopping promotions on November 1, said it recorded 200 billion yuan ($30.3bn) worth of sales by nine minutes after midnight on Wednesday, while electronics retailer Suning.com Co Ltd – part-owned by Alibaba – said it made five billion yuan ($758m) in sales in the first 19 minutes of the day.
Analysts expect this year to be a boon for luxury brands, as Chinese consumers accustomed to going overseas to buy high-end goods are now stuck at home due to coronavirus border closures.
Andy Halliwell, retail analyst at digital consultancy Publicis Sapient, in a client note said: “The lack of consumer tourism which has hit European and US stalwarts like Harrods, Galeries Lafayette and Nordstroms will likely see bigger spending locally”.
On China’s Twitter-like Weibo, discussions around Singles’ Day trended while a poll by Sina Entertainment, which garnered 174,000 respondents, found 76,000 people aimed to spend less than 1,000 yuan ($151.60) while only 7,341 planned to dole out more than 10,000 yuan ($1,515.92).
Alibaba first launched the shopping event in 2009 and has made it the world’s biggest online sales festival, eclipsing Cyber Monday in the United States. Last year, it recorded $38.4bn in GMV on the day.
In a nod to the pandemic, Alibaba scaled has back on live events this year and is instead relying on increased online promotions such as celebrity livestreams to draw hundreds of millions of shoppers to its e-commerce platforms.
Shoppers can buy heavily discounted goods such as cosmetics, clothing and groceries from its Taobao and Tmall platforms and have them shipped via the company’s Cainiao logistics service and book flights to domestic tourist hotspots on the Fliggy travel website. Kaola — purchased from NetEase Inc. last year – is participating for the first time, offering goods from 89 countries to consumers.
Steep discounts may be the key to enticing consumers, which have only just started to loosen their purse-strings. China’s retail sales climbed 3.3 percent in September from a year ago and growth may have accelerated to 5 percent in October, as travel and other consumption picked up during the Golden Week holiday at the start of the month.
But overall retail sales are still down for the year – shrinking by about 7 percent in the first nine months from the same period in 2019 – and it remains to be seen if strong spending during national holidays and one-off shopping events like Singles’ Day will translate into a sustained recovery.
Private consumption accounted for no more than 0.5 of a percentage point of economic growth in the third quarter and a full recovery in consumer confidence may only come in 2021, according to Australia & New Zealand Banking Group economist Xing Zhaopeng.