Record on Singles Day? Nothing that was unexpected on the world retail scene, and 2018 was no exception. But a more careful reading of the numbers is necessary to better identify what the event tells us.
Alibaba Group Holding emphatically announced the umpteenth record-breaking Singles Day: 30.8 billion dollars of sales in the 24 hours online, 5.5 more than the 24 billion of the previous year. The volume achieved in the first hour after midnight, according to Reuters, was 10 billion. Alibaba shipped over a billion packages for the first time.
Customers from over 230 different countries participated in Singles Day. Ranking of the top 10 retailers by nationality sees Japan, the United States and Korea as the top three, with Italy in tenth position. There were 237 brands that exceeded 100 million RMB ($ 14 million) in total sales.
JD.com, Alibaba's strongest rival in China, for its part announced that it had sold goods worth RMB 159.8 billion ($ 22.5 billion) during its longest lasting trading event that began on the first of November and concluded on Singles Day.
There are important differences in the commercial approach of the two major retailers. While Alibaba played the game on both its B2C platform (Tmall) and on its marketplace (Taobao), JD. Com focused mainly on brand distribution. In this way, it avoided the problem of counterfeit products that afflicts Alibaba, still on the black list of the US government.
Singles Day in the name of transversality, in any case. JD.com pushed sales in its network of physical stores (the very advanced 7FRESH supermarkets, the automatic shops and the "Experience Shops", terminals for the online experience). Alibaba did the same things in its Hema supermarkets and InTime stores. 600,000 shops also used its technology and infrastructure for their local Singles Day.
Despite the record, however, the growth rate of the event (assessed on the performance of Alibaba) fell from 39% to 27%, the lowest in the last ten years. This is also true for the large volumes traded, of course, but at the beginning of the month the Jack Ma revised downward its sales prospects for 2019, by an amount between 4 and 6 percentage points.
The decline in sales forecasts is generally attributable to the growing commercial tensions between China and the US. According to some analysts, a long trade war with additional US tariffs could affect Chinese GDP by up to 0.7%.
In this regard, the Chinese Premier, Li Keqiang, intervened today and reiterated Chinese support for the free market against the "growth of protectionism and unilateralism" wanted by the USA.