Alibaba and JD.com are keeping Double 11 earnings secret. The Chinese consumer is clearly changing.

Like the 14 Dual 11 has come to an end, the depression of consumer morale in China and the huge change in consumption habits have made this year’s shopping festival not reach the feverish growth of previous years.

In an unprecedented move, neither Tmall nor JD.com announced their GMV (Gross Merchandise Volume) results for this year’s Double 11, also known as Singles’ Day. Tmall reported that the sales volume was the same as last year which reached $74.56 billion (540.3 billion RMB), while JD.com reported that its performance exceeded the industry growth rate and hit a record high after last year. $48.17 billion (RMB 349.1 billion) GMV – although specific figures were not given. Additionally, the live gala ceremonies usually hosted by Alibaba, JD.com and Pinduoduo did not take place, possibly to avoid large gatherings and COVID-19 transmission.

A more diversified market

However, the shopping fever has not completely subsided. Tmall revealed that in the first hour of the festival on October 31, the turnover of 102 brands exceeded 13.8 million dollars (100 million RMB). Although it only launched its commerce feature in 2020, Douyin’s GMV increased by 629.9% per year-over a year on the first day of this year’s Double 11 event. It’s clear that newcomers are catching up fast in their transition from content sharing to e-commerce. Since each platform comes with its own bankable influencers, the likes of Douyin’s most popular content creator, Crazy Little Brother Yang, who has over 100 million subscribers, are likely to be key to the sales growth.

Although the two major Chinese tech giants remain silent on their GMVs, according to Syntun, an independent big data monitoring company, the total GMV of all major e-commerce platforms has exceeded 1 trillion RMB for the first time. . Traditional e-commerce platforms brought in around RMB 934 billion, while new e-commerce platforms like Douyin brought in around RMB 181 billion, according to their report. Then there were additional contributions from new retail platforms and community group buying online retailers.

Although it only launched its trading feature in 2020, Douyin’s GMV rose 629.9% YoY on the first day of Double 11. Photo: Weibo

Household products, outdoor sports, pet supplies, wellness, toys are new winning categories

Although overall sales figures have not been released, new consumer trends can still be identified. Tmall reported that outdoor sports, pet supplies, toys and collectible jewelry are the new four-pillar industries (traditionally, the four energy-pillar industries were beauty, consumer packaged goods, consumer electronics, and apparel). In these four categories, sales of 358 brands exceeded RMB 100 million.

JD.com also pointed out eight new consumer trends, including more spending on products that deliver long-term returns, particularly in the health, wellness and education categories, as well as environmentally friendly labels. Other big trends on JD.com include a focus on new arrivals and items that bring comfort (think rocking chairs and scented candles).

China-chic products inspired by traditional culture have also led the way at JD.com. Indeed, domestic products continue to be consumers’ first choice. According to Douyin’s Double 11 report in 2022, national assets accounted for more than 90 percent of the top 100 best-selling products.

JD.com reported that products that offer long-term returns, such as those related to health and wellness, jumped from this Double 11. Photo: Weibo

What happened in luxury?

In terms of luxury consumption, more than 200 luxury brands joined Tmall this year, spanning handbag, fashion, jewelry, beauty and liquor categories. However, instead of offering discounts, many of them used the festival to launch new products. Tmall launched more than 100,000 new luxury products this Double 11, including the Kate handbag from Saint Laurent and the Reverso Tribute Duoface Calendar watch from Jaeger-LeCoultre.

During this time, JD.com used new technologies such as VR, AI and Digital Collectibles in Omnichannel Scenarios to Boost Luxury Shopping Double 11. During the first 10 minutes of the peak shopping period (from 8 p.m. on November 10 to 12 a.m. on November 11), the best performing luxury houses such as Bulgari, Celine, Fendi and Loewe saw their turnover increase about 18 times compared to last year. . Others like Burberry, Ferragamo, Prada, Lanvin and Qeelin would have increased more 227 percent for the same period – showing promising peak hour sales. Sales of luxury handbags and shoes rose 180% year over year on JD.com, another general boost for luxury.

New luxury versions of this Double 11 included YSL’s Kate Reversible Small Chain Bag and Jaeger-LeCoultre Reverso Tribute Duoface Calendar watch. Photo: Weibo

Quality and loyalty rather than quantity?

As markets mature amid economic uncertainty, the exponential phase of China’s e-commerce market growth has come to an end. The focus is now on how to optimize the consumer experience. Tmall, for example, increased the maximum number of products that can be saved in shopping carts from 120 to 300 this year.

To build customer loyalty, develop membership has become a priority for traders and platforms. In 2017, Alibaba launched its “88 Member” loyalty program to boost customer engagement and improve personalized service. However, the initiative proved to be a success. In June, Alibaba said the 25 million users registered with its loyalty program had spent an average of $4,865 (57,000 RMB) per person over the past year.

Brands are also building their own membership programs, with existing VIP members accounting for a large portion of sales. At this year’s Double 11, over 2,700 businesses on Tmall saw half of their total sales made by their own members. In addition, more than 4,000 brands saw their member sales increase by 100% compared to the previous year.

These results paint a complex picture. Purchasing priorities and categories have clearly shifted as consumer motives evolve to be more quality-focused. As Dai ShanEmphasized the president of Alibaba’s Core Domestic E-commerce, the future of Double 11 is no longer a machine producing ever-higher GMVs, but an important platform for better customer experience and growth of the company.

About Anne Wurtsbach

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