China's mid-year shopping festival delivers record results

Chinese e-commerce giants Alibaba and JD have achieved record-breaking results for the annual 6.18 shopping festival, with both companies benefitting from innovative marketing and an upsurge in demand for quality from consumers in lower tier cities.

The sales festival, which takes place during the first 18 days of June each year, saw JD generate total sales worth US$29.2bn, an increase of 27% from the same period in 2018.

As reported by Inside Retail Asia, JD’s launch of new products was a significant driver of its “breakthrough results”, but innovative marketing campaigns that encouraged and rewarded consumers for sharing on social platforms also contributed to the growth.

JD’s investment in technology and efficient logistics also paid off, with 91% of orders to its fulfilment centres delivered the same or next day and the number of orders fulfilled increasing 99%.

Meanwhile, Alibaba released a statement to announce that more than 200,000 brands took part in this year’s 6.18 festival to reach consumers on its Taobao and Tmall online marketplaces.

According to the company, use of its marketing and campaign tools helped more than 110 brands to each generate gross merchandise volume (GMV) of over Rmb 100m ($14.5m).

For example, the number of Taobao live-streaming sessions hosted by brands increased by more than 120% since 2018 and these included some major international brands, such as Puma and Casio.

Alibaba’s dedicated market research arm, Tmall Innovation Center, also used data intelligence to help brands curate and develop new products that best appealed to Chinese consumers.

And its flash sales channel, Juhuasuan, which helps brands to attract new customers via discounts, added more than 300 million new customers.

“We are very pleased to see that our strategy to help brands penetrate the less-developed markets has paid off. Customers in the emerging cities are very receptive to innovative products and promotion campaigns, such as programs on the Juhuasuan platform,” said Jiang Fan, president of Taobao and Tmall.

“The number of customers and GMV from third- to fifth-tier cities both hit 100% growth,” he added. “We believe this group of customers will continue to grow into a strong and sustainable force for brands who are looking at further developing the Chinese market.”

Sources: Inside Retail Asia, Alibaba; additional content by WARC