China Annual 618 Festival-be E-commerceThe Christmas sales-led shopping frenzy that runs through June 18 has seen sales fall this year for the first time in at least eight years.
JD.com The company created the shopping holiday in 2010, and the festival’s name and date coincide with the company’s founding date, June 18, 1998. The 618 Festival was originally a way for JD.com to try to compete with competitor Alibaba, which in 2009 launched China’s other major shopping event, Singles’ Day (also known as Double 11).
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Since then, both Singles’ Day The 618 Festival has seen astronomical growth, with shoppers planning their shopping for the holiday just like any other market. Amazon Prime Day, Black Friday or Cyber MondayThe two shopping events started with just two companies, but now all of China’s major e-commerce companies are joining the unofficial holidays.
Data analytics firm Syntun, which tracks 618’s performance annually, estimates the festival’s gross merchandise volume (GMV), which tracks the value of goods sold on e-commerce platforms, will be 742.8 billion yuan ($102.3 billion) this year, down nearly 7% from 798.7 billion yuan ($110 billion) in 2023.
Sintung told CNBC that sales had fallen to their lowest since it began tracking the 618 metric in 2016.
Despite Sintung’s gloomy prediction, JD was quick to boast that this year’s 618 had set “new records in both transaction volume and orders.” The company launched its 618 promotion in late May this year, opting for a longer promotional period to allow consumers to pay prepayments for certain products and complete their purchases during the festival.
rival Alibaba It did the same on its Tmall and Taobao platforms.
While JD cited its own strong holiday performance, Sintong’s data showed that Alibaba’s Tmall captured more GMV, relegating JD to second place. PDD Holdings’ Pinduoduo came in third. Sintong considers these three platforms, along with several others, to be “traditional” e-commerce platforms, and said they accounted for 571.7 billion yuan ($78.7 billion) of total GMV this year. Last year, the same group’s traditional platforms had GMV of 614.3 billion yuan ($84.6 billion), Sintong said.
Meanwhile, livestreaming platforms such as TikTok, Kuai Shou and Dian Tao generated GMV of 206.8 billion yuan ($28.5 billion). In terms of live shopping market share, TikTok took the top spot with 618.
Xintun described the livestreaming sector’s performance as “stellar,” which could be attributed to the fact that livestreaming was the only e-commerce subcategory to experience notable growth in 618. Livestreaming GMV reached 184.4 billion yuan ($25.4 billion) last year.
Despite some growth in livestreaming, the overall decline in 618 festivals this year may be a cause for concern: 618 festivals’ GMV was growing even during the COVID-19 pandemic, so a decline could mean trouble for a market already battling less-than-great long-term economic forecasts.
The International Monetary Fund said in late May that it expects China’s economy to grow 5% this year, but that growth could slow to just over 3% by 2029 due to an aging population and problems in the housing and real estate sectors.
Even as Chinese consumers start to lose interest in e-commerce giants like JD and Alibaba, other markets are seeing a craving for lower-priced goods in the face of inflationary pressures, some Western shoppers are starting to buy more goods from e-commerce platforms like Amazon instead. TEAM, ShaneAlibaba, etc. Salesforce said these and other platforms 21 percent of Western holiday spending this year.
Singles’ Day, observed annually on Nov. 11, may be an indicator of whether Chinese consumers will re-adopt ultra-low prices offered by e-commerce merchants as Westerners increase their spending on more expensive items.