China's consumers splurged more than 74 billion yuan (S$16.6 billion) on online goods at an annual shopping spree yesterday, smashing previous records as Beijing looks increasingly towards domestic consumption to fire up growth in its sputtering economy.
Known as Singles Day - which falls on Nov 11 in China - the event was created by e-commerce giant Alibaba in 2009 to persuade the loveless to console themselves with retail therapy. It is seen as China's equivalent of Cyber Monday in the United States.
The 74 billion yuan in sales on Alibaba platforms as at 6.45pm yesterday eclipsed last year's Singles Day's total turnover of US$9.3 billion (S$13.2 billion), already up 60 per cent from the year before. The sum of 74 billion yuan is also roughly equivalent to the entire economy of Laos last year. The sales figure is expected to reach as much as US$13.8 billion after the final numbers are tallied, according to research firm IDC.
The speed at which sales transactions racked up has also been staggering. The US$5 billion in sales Alibaba netted in the first 90 minutes past midnight, for instance, was nearly twice the entire takings of last year's Cyber Monday sale. Alibaba has an 80 per cent share of Chi- na's total online shopping market.
Top-selling items included baby- related and nutritional products, as well as apparel by Nike and Levi's, the company said. It added that an estimated 1.7 million deliverymen, 400,000 vehicles and 200 airplanes would be deployed to handle the massive operation.
Finance sector analyst Huang Ailing, 27, said she bought two pairs of boots, a leather bag and cosmetics worth about 2,500 yuan, or about a fifth of her monthly pay, through Alibaba's mobile app Taobao, a platform similar to eBay.
"I put off shopping for the past month to wait for this day to come. While I logged in right after midnight to make the purchases, it still took me a while as the network was extremely busy," she said.
Ms Huang, who is part of an expanding army of Internet shoppers in China, which has the world's biggest online population of 668 million, estimated she enjoyed discounts of about 300 yuan.
The seismic shopping activity also reverberated in countries as far away as Australia, with premium baby milk formula flying off supermarket shelves ahead of the Singles Day buying frenzy.
Tasmania-based infant formula- maker Bellamy's Organic apologised to local mothers on Tuesday on Facebook, after shoppers complained that they were unable to buy the formula at local stores because of the huge demand from China in the lead-up to the event, according to an Agence France- Presse report.
Observers are watching the online extravaganza closely for clues about private consumption in China, as the world's No. 2 economy looks to chalk up 7 per cent growth this year - the weakest in 25 years.
China is seeking to transition from an investment-driven and export-reliant economy to one led by consumption and services in the next five years, while maintaining at least 6.5 per cent growth a year.
Gavekal Dragonomics economist Chen Long told The Straits Times that while Singles Day might be a showcase for China's growing service industry and the power of Chinese consumption, it is largely only the e-commerce sector that is enjoying such rapid growth.
Traditional retail sectors like brick-and-mortar shops, for instance, are not experiencing similarly robust growth.
"What the event shows is simply that online sales are taking over a larger share of the retail pie," he said.
"E-commerce might be one of the bright spots in the economy but other service sectors such as transportation are not doing as well, as they are highly correlated with the weak industrial sector, which ultimately is still dragging the overall economy downwards."