HONG KONG (AP) – Chinese shoppers are tightening their purse strings, raising questions about how a slump in consumer confidence will affect Saturday’s annual Singles’ Day online retail extravaganza. It is occurring.
Singles’ Day, also known as “Double 11,” was popularized by e-commerce giant Alibaba. In the days leading up to the event, sellers such as Alibaba often reduce prices and offer attractive deals.
Considering the general get frustrated about work and real estate market is weakit is unclear how this year’s festival will take place.
A survey of 3,000 Chinese shoppers conducted by Bain & Company found that given the economic uncertainty, more than three-quarters of respondents said they would cut back or plan to spend less this year. It turns out that they plan to maintain that level.
They include people like Shi Geng Chen, whose billiards hall business in Beijing’s trendy Chaoyang district is sluggish.
Mr Shi said the economic situation was poor and it was affecting business. “We have fewer customers than before,” he said, adding that sales are only 40% of pre-pandemic levels.
“I don’t spend a lot of money,” he said. “Of course, everyone has the desire to spend money, but you have to have money to spend.”
Before the coronavirus outbreak in 2020, Chinese consumers were more eager to splurge. On Singles’ Day 2019, shoppers spent $38 billion in 24 hours on Alibaba’s e-commerce platform.
But analysts say Chinese people are becoming more cautious about spending big on extras.
“The hype and excitement surrounding Singles’ Day has somewhat died down,” said Sean Lane, founder and managing director of Shanghai-based China Market Research Group. , we have received stable discounts every day.” Therefore, no significant discounts are expected on Singles Day, except for consumables,” he said.
Mr Lane said shoppers were likely to be more keen to pick up deals on everyday items such as toothpaste, tissues and laundry detergent rather than high-end cosmetics or luxury brands.
Fu Ming, a convenience store worker in Shijiazhuang, northern China’s Hebei province, said he no longer uses anything but everyday items.
“I feel like people aren’t spending as much money as they used to, probably because they don’t have as much money,” she said.
Gao Di, 28, from Beijing, said he hasn’t felt much of an impact from the economic slowdown, but said he no longer plans to buy things just for festivals. However, if you want to get your item before or after Singles’ Day, you can place your order during the event and wait.
“Maybe it’s because my way of thinking has changed,” said Gao, who works in the insurance industry.
E-commerce platforms are highlighting low prices at this year’s festival, hoping to attract value-conscious customers looking for bargains. For its 2023 campaign, Alibaba-owned Tmall boasts the “lowest prices on the web,” while the tagline for e-commerce platform JD.com’s Singles’ Day campaign is “really cheap.” His rival retailer, Pinduoduo, advertises “everyday low prices.”
Some of their business strategies contributed to increased sales.
JD.com announced on Sunday that transaction volume, orders and user numbers during the festival were all-time highs, without disclosing specific numbers. More than 60 brands recorded sales of more than 1 billion yuan ($137 million), and the transaction volume of nearly 20,000 brands soared more than three times year-on-year, the report said. Earlier, the company announced that the number of orders from new merchants had jumped more than five times compared to the same period last month.
Lu Fei, a senior researcher at the Jingdong Commercial Research Institute of Consumer and Industrial Development, said the company’s sales statistics still showed there was “obvious” growth in consumption.
“Growth in sales of mobile phones, jewelry and consumer electronics shows that there is user demand for quality growth. But there is no doubt that consumers are becoming increasingly rational. ” said Lu.
According to an article on Alibaba’s Alijila News Hub, as of midnight Saturday, about 400 brands’ gross merchandise value exceeded 100 million yuan ($13.7 million), and 38,000 brands’ GMV doubled year-on-year. It is said that it became The company’s Taobao and Tmall Group added that the number of orders, especially during the festival period, recorded an increase compared to the same period last year.
China’s State Post Administration announced on Sunday that the transaction volume of express delivery service providers during the festival reached a new record. On Saturday, the express delivery company announced that it had collected about 640 million express parcels nationwide, an increase of 15.8% year-on-year.
Jacob Cook, co-founder and CEO of e-commerce consultancy WPIC Marketing, said the crisis in China’s real estate sector is likely to reduce overall spending on consumer durables such as home appliances. said. Shoppers are expected to feel less confident about their wealth and switch to cheaper brands.
“However, the data shows a tremendous desire among middle- and upper-class consumers to spend money on experiences and products that enhance their health, lifestyle, and self-expression,” Cook said. , and listed categories such as sports. clothes.
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Associated Press researcher Yu Bing and video producer Caroline Chen in Beijing contributed to this report.
Zen Soo, Associated Press