The great silence after Single’s Day

Historically a generator of strong sales, it is unclear this year exactly how much China’s “Single’s Day”, the biggest shopping festival of the year, was a boost for Alibaba and JD.com. Both e-commerce giants have not published results for the first time since the online shopping festival began.

Alibaba said its ‘11.11’ campaign this year had delivered results on par with last year’s shopping event “despite macroeconomic challenges and the impact of Covid-19”. In 2021, Alibaba achieved a gross merchandize value (GMV) of 540.3 bn yuan ($76.1 bn) through Single’s Day.

JD.com talks of a “record-breaking” 11-day Singles’ Day promotion without giving specific figures. Last year, the transaction volume for JD.com stood at 349.1 bn yuan ($54.6 bn).

Relevance of Single’s Day

Originally a one-day event on 11/11 (hence the name Single’s Day), the Chinese shopping festival has evolved into a multi-day event that outshines Black Friday and Cyber Monday in the US in terms of size and growth.

While GMV and transaction volume cannot be converted into direct sales, they are an indicator of consumer spending in China. Investors and economists see Single’s Day as an essential barometer of the country’s economic health. Ming Lu, a China equities analyst at Aequitas Research who writes on Smartkarma, said that sales for e-commerce platforms have been “not very successful”. Consumers had long complained about “fake discounts”, he said. “Also, consumers’ incomes are decreasing after frequent lockdowns,” Lu adds.

Covid restrictions have weighed heavily on China’s economy and consumption this year. Retail sales rose 2.5% year-on-year in September, a sharp drop from the previous month’s 5.4% growth.

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China is scheduled to release October industrial production and retail sales data on November 15. Preliminary data has shown a decline in manufacturing activity and credit demand.