Today is ‘Singles Day’ in China; for better or worse, that’s their equivalent of Cyber Monday. ‘Singles Day’ is November 11 each year — 11.11 — because the ‘ones’ (1s) in 11.11 represent bare branches, or Chinese slang for bachelors. Around 2010, these so-called Chinese lonely hearts turned the day into a massive online shopping extravaganza.
Let’s talk numbers for a second: there are about 271 million online consumers in China (about 561 million have Internet access). Last year, Taobao and TMail, two online retailers in the Chinese space, saw a combined $1 trillion in sales on this day in 2012; Alibaba, which is headed for a public offering with twice the money of Facebook, also rakes it in on this day. Consider: Roughly $3.3 billion was spent on Singles Day 2012; Cyber Monday 2012 (in the U.S.) as a whole raked in about $1.5 billion. That’s, er, double. (Yes, China has significantly more people than the U.S., but until very recently, we haven’t conceptualized their society as Internet shoppers.) They hit last year’s total at 1pm local today.
Here are some absolutely odd statistics from Alibaba, which dominates online retail in China.
Alibaba’s rivals are trying to figure out a way to chip at their dominance on this day, and it’s all part of what’s legitimately the world’s biggest shopping spree. If you’re still skeptical, just consider this simple and short article. (It should be noted that Alibaba doesn’t actually sell merchandise; it offers a platform through Taobao and TMail, among others.) Tencent, one of Alibaba’s rivals that is publicly traded, has seen shares rise 60% this year. Some media outlets believe China might put up $8 billion in online sales today; if you think about that another way, one day in China gets them to 13 percent of the total revenue Amazon collects in a year.
The final numbers might be dizzying for an American consumer to comprehend, and price competition on the day is considered ‘thermonuclear.’ At the same time, some consider the day to be questionably good for e-commerce, with J.P. Morgan arguing that it can lead to a situation where Chinese consumers only buy items on discount; that, in turn, cuts into operating margins. Just because of sheer numbers, though, the Chinese consumer is likely ‘a global gamechanger.’ You know something just got big when Western brands, ala Microsoft and GAP, are trying to cash in.
My brief, mostly uninformed take: the Chinese economy is probably as important, if not more important, than any single economy to the current global fiscal health (poorly constructed sentence right there, but bear with me). As Chinese consumers expand (and the number of expats grows) — online sales jumped two percent or more as a percentage of the market in the last six to 12 months — things like Singles’ Day will continue to be game-changers. Think about this: the U.S. unemployment rate is falling, yes, but thinking that Cyber Monday 2013 will be significantly more than last year’s $1.5 billion is probably a stretch. China may rack up 4x that today. That’s a game-changer by any definition. And to think, this all started so simply at Nanjing University…