The figures are in. Alibaba logged a whopping $14.3 billion in sales on Singles’ Day shopping event, smashing all the previous records. It was 60% higher than last year’s $9.34 billion sales on Singles’ Day. However, the Chinese e-commerce giant’s shares fell 1.99% to $79.81 on Wednesday, and went down another 0.76% in pre-market trading Thursday.
Next few months to be tough for China: Jack Ma
The stock witnessed a slight increase early on Wednesday, but went downward after Alibaba founder Jack Ma offered a cautious outlook. In an interview with CNBC, Ma said the next five to 15 months would be challenging for the Chinese economy. Since Alibaba’s business largely relies on consumption, a slowdown in Chinese economy might be worrisome in the long-term.
China’s economic growth has fallen below 7% largely due to excess industrial capacity, falling investments, and a stronger yuan. Analysts fear that the economic slowdown might trickle down to domestic consumption. However, Alibaba’s strong show on Singles’ Day has confused the China growth debate. Even though the economy is slowing, Alibaba alone sold $14.3 billion worth of merchandise in 24 hours. That figure doesn’t include billions of dollars worth of goods sold by its rivals including JD.com.
Alibaba’s sales figures dwarf Cyber Monday by a distance
By comparison, Cyber Monday, the biggest online shopping day in the US, hit only $1.35 billion in sales last year, according to ComScore. The top selling items on Alibaba’s Taobao and Tmall platforms were nutritional and baby-related products, Levi’s jeans and Nike sneakers. Months ahead of the mega event, Alibaba had moved the event’s headquarters to Beijing, signed exclusive deals with dozens of brands, and brought in Daniel Craig to add glamour to the event.
The Singles’ Day sales figures showed China’s consumption potential. Alibaba estimated that its partners deployed 1.7 million deliverymen, about 400,000 vehicles, and more than 200 airplanes to deliver packages. Approximately 70% of all transactions took place on mobile devices.