China Consumption Rebounds as E-commerce Giant Alibaba’s Tmall Taps Into Mid-year Shopping Festival
Alibaba’s Business-to-Customer (B2C) e-commerce platform Tmall has kicked off its mid-year shopping festival at midnight on June 1. The so-called “6.18 Mid-Year Sales Promotion” was originally initiated by JD.com to celebrate its June 18 company anniversary, but got turned into a mid-year sales campaign that lasts for weeks on its rival e-commerce platforms such as Alibaba’s Taobao, Pinduoduo and Suning.
It’s not even June 18 yet, but the competition to win the month-long campaign has already started. Brands participating in this month-long annual campaign on Tmall doubled from last year, reaching a total of 100,000 brands. Following the kickoff, the Gross Merchandise Volume (GMV) in the first 10 hours was 50% higher over the same period last year. There has been a doubling of sales in categories such as cosmetics, home appliances, computer notebooks and electric cars.
“Online consumption has seen a post-pandemic revival since March, and the sales rebound that we have observed on Taobao and Tmall has been very encouraging,” said Liu Bo, vice president of Alibaba Group and general manager of Tmall and Taobao marketing and operations.
As the global pandemic stalled the world’s economy and dampened China’s consumption, the mid-year shopping festival has taken on additional importance as an indicator of China’s economy recovery, while consumption is expected to pick up on bullishness about the country’s prospects.
On the merchant side, Tmall is committed to helping brands reboot the coronavirus-hit sales through the 6.18 shopping festival.
“We have seen millions of new merchants open stores on Tmall since February,” Liu told Pandaily. “A huge number of traditional retailers and consumer brands started to embrace the ideas of ‘new retail’ and e-commerce. We hope that through in-store live streaming, more offline retail stores could join our mid-year promotion, gaining sales growth in the first country-wide shopping festival after the coronavirus.”
As e-commerce livestreaming played a vital role for many brands during the outbreak, the overall sales generated by live sessions made a huge increase from a year ago. The GMV generated through Taobao Live hit 5.1 billion yuan in the first day of the 6.18 shopping festival. More than 1,000 brands, merchants and livestreamers achieved a GMV worth 10 million yuan.
According to Liu, Tmall uses celebrities and corporate bosses to draw viewers and boost sales for the livestreaming sessions, featuring over 300 celebrities with big influence and 600 brand executives to engage directly with consumers. Meanwhile, over 10,000 offline retail stores will be livestreaming to promote their products.
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Liu also said Taobao Special Offer Edition will roll out livestreaming functions during the shopping festival, enabling manufacturers to promote consumer-to-manufacturer (C2M) products and driving consumer engagement. Taobao just announced its new move to a C2M plan in March to bring 10 billion new orders to traditional factories across China over the next three years.
“We have been developing a C2M model for many years,” Liu said. “Alibaba launched the ‘2020 Spring Thunder Initiative’ to help small and medium enterprises (SMEs) in April. Now for 6.18 shopping festival, we launched a special session for domestic sales of commodities originally produced for exports. The pre-sale of these C2M orders surged 668% year-on-year on June 1.”
According to Liu quoting the statistics on Taobao Special Edition, there are more than 280,000 factories taking overseas orders that have set up their business on the platform since its official launch. Taobao Special Edition has provided support to SMEs such as increasing their traffic on the platform, providing financial support and assisting them in logistics chains.
