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Shopping gala rises to become global giant

By He Wei in Shanghai | China Daily | Updated: 2018-11-21 10:27
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Workers at a delivery company in Lanzhou, Gansu province, sort parcels. [Photo by Pei Qiang/for China Daily]

New growth engine

The buying spree has helped to ease any concerns over a slowing economy, as consumption takes center stage in powering the nation's economic engine. According to the National Bureau of Statistics, the contribution of consumption spending to GDP growth reached 78.5 percent in the first half of this year.

The overall size of the nation's online retail sector reached 7.18 trillion yuan last year, a year-on-year rise of nearly 32.2 percent. This figure is projected to exceed 18 trillion yuan by 2025, with the online proportion of retail sales of consumer goods forecast to hit 25 percent, the bureau said.

Meanwhile, the retail import penetration rate of China's cross-border e-commerce sector (consumers buying goods through cross-border e-commerce platforms as a proportion of online consumers) rose from just 1.6 percent in 2014 to 10.2 percent last year, according to research by consultancy Deloitte, the China Chamber of International Commerce and Alibaba's research arm.

Buying imported goods online has become more commonplace, as new users' average spending per transaction and the average number of product categories bought increases, the study found.

For example, the average number of product categories bought by first-time users in 2014 was 1.6, but by last year this had risen to four, while average spending per transaction last year rose to 2.5 times that in 2014.

This trend is a vote of confidence for companies such as Chemist Warehouse, an Australian online pharmacy. According to Nancy Jian Fei Fei, its Greater China CEO, it was the only company with origins in Australia and New Zealand to achieve sales of 100 million yuan on Tmall Global on Nov 11 this year. "Our popularity is in part thanks to the growing disposable income of Chinese consumers and their changing mindset on healthcare," Jian said. "Also, our brand awareness has been further strengthened as more foreign manufacturers devote more resources to marketing efforts in China."

Wang Ying, 34, a company clerk in Shanghai, bought two bottles of vitamins from Chemist Warehouse during Singles Day this year and enjoyed a discount of 25 percent.

"The maturing cross-border e-commerce setup can circumvent a lot of consumer education work," she said. "With the bonded warehouse in place, these imported goods can be delivered within just a couple of days to your doorstep."

Husayn Remtulla, CEO of VIVA Naturals, a Canadian nutrients supplier, said, "Double 11 is similar to Black Friday (the shopping day held the day after Thanksgiving in the US) or even Amazon Prime Day (a one-day global event exclusively for Prime members), except the scale and magnitude dwarfs anything that happens here in North America.

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