Chinese consumers were taking to the internet in record numbers on Monday for an annual 24-hour online sale that has ballooned into the world’s biggest e-commerce event.
Alibaba, the biggest online retailer in China, said in advance of the promotion that it expected to sell more than 30 billion renminbi, or about $5 billion, worth of goods on Monday — two-and-a-half times the total that “Cyber Monday”, the biggest e-commerce day of the year in the US, yielded last year.
The one-day shopping craze, for which Chinese consumers were preparing well in advance of the midnight start, highlights the frenetic growth of e-commerce in China. The country is set to overtake the US this year as the largest e-commerce market in the world, according to Forrester Research. Chinese consumers are predicted to spend $290 billion at online retail sites, compared with $260 billion for their US counterparts.
The promotion was pioneered by Alibaba in 2009, when it latched on to an existing, unofficial Chinese holiday dubbed Singles’ Day. For some years previously, young Chinese lonely-hearts had been gathering once a year to lament — or raise a toast to — their single status. The event took place on November 11 because it was the only day of the year when the calendar showed four 1s, or “singles”.
E-commerce shopping companies like Alibaba have built anticipation for 11/11 by letting consumers put items into online “shopping carts” before the sales actually began. One of Alibaba’s sites, Tmall, said five million customers had already selected more than 40 items each by Sunday evening.
Alibaba said it had taken in more than 6.7 billion renminbi in sales in the first hour of the promotion, from midnight to 1 am Monday, through its online payment system, Alipay.
“Chinese consumers are bargain-hunters, and that is what is driving the success of 11/11,” said Serge Hoffmann, a partner at Bain, a consulting firm, in Hong Kong.
Bain expects online shopping in China to grow at an annual rate of 32% from this year through 2015. That is a slowdown from the 71% rate recorded from 2009 through 2012, but well above the 13% average rate expected for 2009 through 2015 in the US. In 2015, the firm forecasts, e-commerce will total 3.3 trillion renminbi in China.