Shopping
Chinese e-commerce sales up 14% for 618 shopping festival, report says
![Chinese e-commerce sales up 14% for 618 shopping festival, report says Chinese e-commerce sales up 14% for 618 shopping festival, report says](https://cdn.i-scmp.com/sites/default/files/styles/og_image_scmp_generic/public/d8/images/canvas/2024/06/22/401a1821-133c-46ef-8cdb-9587c4bbfbc8_ff35e090.jpg?itok=8Dzo5xet&v=1719033514)
JD.com said on Wednesday that transaction volume and orders during the midyear sales extravaganza broke records, without disclosing the exact figures.
Taobao and Tmall’s GMV also recorded a new high during the campaign period through June 18, according to people familiar with the matter.
“The gap between online growth and total growth in retail sales has gradually widened, indicating that the driving force of online consumption is significantly stronger than offline consumption,” Analysys said in the report.
“While there isn’t an obvious consumption downgrade trend this year, consumers are generally more rational in their spending patterns,” said Joyce Ju, vice-president of Greater China Internet Research at BofA Securities.
Ju noted that some categories, such as clothing and home appliances, have shown weaker online sales, while segments like online food delivery remain more resilient.
Despite the GMV growth, many merchants have complained that profits are declining owing to a brutal price war that has emerged as platforms compete to attract price-conscious consumers in a slowing economy.
Zuoliang – a domestic brand that sells bird’s nest soup, a Chinese cuisine, on JD.com – said in a social media post on Thursday that it was “forced to sell at a price that is even lower than our cost” during the 618 event, creating an “unprecedented dilemma”.
Other brands have also complained publicly about taking a loss on their goods, including apparel and appliances.
![A live-streamer sells products online from Longquan Township in southwestern Guizhou province on June 18, 2024. Photo: Xinhua](https://cdn.i-scmp.com/sites/default/files/d8/images/canvas/2024/06/22/20857db9-721b-4db3-a0a3-6ee9784f173c_6aaaa109.jpg)
Merchants have been trying to adopt a more rational sales approach this 618 season, but platform operators have become more aggressive in providing consumers with cash subsidies and discounts, according to BofA’s Ju.
“E-commerce platforms are placing greater emphasis on price competitiveness than ever before, aiming to protect and regain market share amid intensifying competition in the sector,” Ju said.
Pinduoduo reportedly introduced an “automated price-tracking system” for merchants to swiftly adjust prices online during the 618 event. Douyin has also been testing a smart pricing system for merchants, according to recent Chinese media reports.
During the event, the delivery rate of e-commerce parcels grew 23 per cent year on year, outpacing GMV growth, mainly due to higher return rates and a potential year-on-year decline in value per order, reflecting more conservative consumer behaviour, according to a research note from HSBC on Thursday.
Jessie Li, a 30-year-old based in Shanghai, said she had spent nearly 4,000 yuan during the sales event this year. However, this year she chose to buy “obviously cheaper” brands that she would not have bought a few years ago. Many of these are domestic brands that offer similar quality at lower prices, she said.
“After my boss cut my quarterly bonus last year, I had no choice but to become much more price-sensitive,” Li said.