On the 11th November, Alibaba set a new sales record for its biggest shopping day on their annual Singles Day. This was the Chinese company’s 10th Annual Singles Day sale and it racked in an insane $30.8 billion in sales. It took 85 seconds for Alibaba to reach $1bn in sales and sold just under $10bn’s worth in the first hour. There was a 27% increase from last year’s figures as well as a gala to celebrate the beginning of the sale featuring Mariah Carey and a Cirque de Soleil performance.
Alibaba’s Singles Day sale is now the world’s biggest online sales event, bypassing Cyber Monday and even Black Friday. The main reason behind the success of Alibaba’s Singles day is down to the Chinese economy and their growing tech-obsessed middle class. However, China can’t take all the credit for their booming economy, they’ve got America to thank as well because worried American corporations are stockpiling inventory – fully aware of potential trade restrictions and tariffs to come.
‘At current rates of growth China could be a bigger customer globally than America within five years’ said Chris Rogers, a research analyst for Panjiva. It’s an incredibly bold statement from Mr Rogers, but one that is certainly becoming more and more realistic.
Alibaba created Singles Day to celebrate those not in relationships or involving themselves with Valentine’s day. There were around 180,000 brands on their site including the likes of Apple and Xaomi.
The Alibaba Executive Chairman said that shoppers ‘are looking for new ways to upgrade their lifestyles and make their lives better’. This year’s successful Singles Day comes off the back of ‘Alibaba’s weakest revenue growth since seven quarters ago and a cut in annual revenue forecast’. However, their revenues are still growing at a comfortable 54%.
After Alibaba’s Singles Day, their shares tend to sell off and in keeping with past habits – the shares of Alibaba sold off on the following day. And unfortunately, the bad news for Alibaba continues as past data shows that more shares will be sold and will continue to decline during the December period.
Alibaba has taken an early advantage over the likes of Amazon in the run up to Christmas, however, with the predicted stock performance of Alibaba, Black Friday and Cyber Monday on the horizon, it could be a hard Christmas for Alibaba. Furthermore, Amazon look like they’re on the rise and don’t look like stopping anytime soon.