Mid-year shopping festival shows China’s huge potential in consumption

By Chi Jingyi Source:Global Times Published: 2019/6/18 21:38:48

June 18 or 618, another online shopping gala like the double 11, ended on Tuesday. Analysts say massive orders show great potential in China's consumption market.

The accumulated order amount of JD.com, an online shopping platform, had reached 179.5 billion yuan ($25.9 billion) by 2 pm Beijing time Tuesday. In the first hour of Tuesday, the transaction amount increased by 65 percent year-on-year, according to data released on JD's official account on Sina Weibo.

Its rival Tmall, online B2C platform of the giant Alibaba Group, said trading volumes of hundreds of brands had surpassed that of double 11 last year, with the highest increase being more than 40 times, according to a news release by Alibaba Group. The 618 festival on Taobao and Tmall was on June 1. In the first hour, the transaction volume exceeded last year's total amount within 10 hours.

"The huge number of online orders shows that China has great potential as a consumption market," an industry insider who asked to remain anonymous told Global Times Tuesday. "A lot of international brands participated in the shopping feast this year. They are optimistic about Chinese market."

The 618 mid-year campaign is another big online shopping festival initiated by JD since its competitor Alibaba founded the Double 11, or Singles' Day, which is the largest online shopping festival in China. 

Retailers are doing everything to compete in the campaign. JD offers discount and Tmall offers payment by installments with zero interest. Pinduoduo, a newcomer gives subsidies worth billions of yuan.

It's worth noting that Apple joined the 618 e-commerce festival for the first time on Tmall's flagship store. 

The ranking list of sales of the 618 shows that mobile phones, digital and 3C products are in the lead with mobile phone at the top. 

A middle-aged engineer told Global Times that his wife bought televisions, intelligent speakers and other intelligent home appliances during the shopping spree.

"Pinduoduo offers group purchases and I can make orders with friends at a very low price," a 64-year-old retired woman surnamed Li told Global Times Tuesday. "I like dancing after retirement. I often buy dance dresses on Pinduoduo with other ladies in the dance group. And then the group buying expands to daily consumption like fruits, oil, etc."

"I want to see if I'm lucky enough to snag Tmall's offer on the iPhone XR at 618 yuan, 90 percent off," 27-year-old office lady Cai who works for private equity told the Global Times.

"China is seeing an increase in the consumption market and people's purchasing power," said the industry insider.

Retail sales of consumer goods reached 3.3 trillion yuan in May, up 8.6 percent year-on-year, according to data from the Ministry of Commerce (MOC). 

China's consumer market still has huge potential, said an official from the Department of Market Operation of MOC Monday. "With the implementation of policies for 5G commercial license issuances and the promotion of automobile purchases, consumption growth will continue and the consumer market will maintain steady and healthy development."

Sales of retail enterprises in May increased by 2.8 percent year-on-year, up 0.6 percent from the previous month, according to MOC. The retail sales of cars reached 322.3 billion yuan, up 2.1 percent year-on-year and 4.2 percent from April.

"Middle class consumption is increasing. Online retailers see rising demand on intelligent products and automobiles," said the analyst.

Posted in: ECONOMY

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