What’s Going On Here?Chinese ecommerce giants Alibaba and JD.com reported record Singles’ Day sales late last week, as shoppers showed some love to themselves – and the economy. What Does This Mean?Once an excuse for single shoppers to buy themselves gifts, Singles’ Day is now the largest shopping event in the world. And during this year’s sale, ecommerce titans Alibaba and JD.com saw the value of the products they sold jump by 8% and 28% respectively, compared to last year. That meant the duo sold a total of around $139 billion worth of goods during the event – a new Singles’ Day record for them.
Those sales were no easy feat, mind you: the tech giants were under pressure to adhere to the government’s sustainability drive, and put more effort into green initiatives like recycling and reducing emissions. After all, Singles' Day isn't a great match for China's environmental goals: Greenpeace estimates the shopping event generates tens of thousands of tons of carbon dioxide each year (tweet this). Why Should I Care?The bigger picture: Not so single.
Shopping events like Singles’ Day used to run over, well, a single day, but nowadays they often last for much longer. It’s a win-win: retailers get more time to make sales, plus they can manage deliveries and demand better. That’s been especially helpful this year: businesses can struggle to get stock delivered in time for these events during normal times, and current supply shortages will only have made matters worse.
For markets: China wants a rebound.
China reported worse-than-expected economic growth last quarter, sparking worries that consumer spending might be taking a hit. But this record-breaking Singles’ Day suggests people are spending like there's no tomorrow, which might be why an index tracking US-listed Chinese companies jumped more than 5% after the news. And sure, that index is still down 26% this year after government crackdowns hurt Chinese businesses, but investors are hopeful this could be a sign of a turnaround. | 