Singles Day: Alibaba’s annual event sees slowest ever sales growth

Chinese e-commerce giant Alibaba’s Singles Day is known for being the world’s biggest online shopping extravaganza.

But this year it has been a more toned down affair as Beijing cracks down on businesses and economic growth slows.

Sales for the 11-day event rose at their slowest rate since it was launched in 2009, up 8.5% on last year.

However, customer spending still hit a fresh record high of 540.3bn yuan ($84.5bn; £63.2bn).

This year marks the first time that sales for Alibaba’s Singles Day, which the company refers to as the “11.11 Global Shopping Festival “, failed to achieve double digit year-on-year growth.

“It’s probably not that great if you consider the market is expected to grow at almost 12%,” Rui Ma from the Tech Buzz China website told the BBC.

“They’ve already tapped out this holiday to its extreme. This is already a big number so its hard to show growth,” she added.

It comes against the backdrop of the Chinese government’s rapid moves in recent months to impose tough new rules on the country’s internet giants.

After years of limited oversight by Beijing, officials have been enforcing regulations to ensure that the technology industry competes fairly and contributes more to society.

Alibaba found itself in the spotlight during the crackdown as it paid a record $2.8bn fine after a probe determined it had abused its market position for years. The company also said it would change the way it conducted its business.

A different type of event

Shen Lu from technology website Protocol told the BBC that this year’s Singles Day was about improving the company’s image: “Alibaba is trying to present themselves to be a tech company with social responsibility.”

“They’re showing they’re complying with regulations and fitting into the general political atmosphere,” she said.

This approach brought a more socially conscious emphasis to the event than previous years with eco-friendly products and campaigns to raise money for good causes.

For example, viewers of a three-hour livestream were encouraged to click “like” and help raise money for an elephant reserve in China’s rural southwest.

Ms Shen also suggested that there are signs that shoppers are looking for new ways to buy online: “It’s now been 12 years since Alibaba invented the Singles Day shopping event.”

“It was such a hype years ago but it’s no longer exciting for shoppers in China,” she said.

One of those new approaches is live-streaming shopping, which consultancy McKinsey has predicted is the future of online sales in China.

Last month, two of China’s most famous celebrity online sellers reportedly raked in $3bn in just 12 hours.

Slowing growth

Consumers may also be wary of making unnecessary purchases as China’s economic recovery shows signs of losing steam.

According to official figures, the world’s second largest economy grew by 4.9% in the July to September quarter from a year earlier.

That was the slowest pace of expansion in a year and worse than analysts had predicted.

It comes as power shortages, new outbreaks of Covid-19 and concerns about the country’s property market weigh on the economy.

Source: BBC

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