Chinese brands saw sales surge on major e-commerce platforms on June 1, the opening day of the country’s mid-year shopping festival.
The shopping spree comes from supporting measures to spur domestic consumption which shows the economy’s resilience. Rising domestic sales may offset the impact of the prolonged China-US trade dispute according to experts.
Major e-commerce platforms made a good start of this year’s “618 Shopping Festival” beginning on Saturday, June 1, according to the Beijing Youth Daily Sunday.
More than 17 million items were sold on JD.com in the first hour of June 1, 83 percent up from last year.
By 11:23 am, Alibaba’s e-commerce platform Tmall had exceeded the total business volume of last June 1.
More than 10 major brands on Suning.com had sold more than 100 million yuan ($14.49 million) worth of goods in the first hour.
Amid the boom, Chinese consumers are showing great interest in quality and innovative products, the report said. Air conditioners priced higher than 8,500 yuan are hot-selling home appliances on JD.com. In the first hour, sales of OLED TVs, which represent the future of TV technology, were up 270 percent compared with last year.
China has rolled out measures to boost domestic consumption. China’s individual tax revenue in the first four months dropped 30.9 percent, while overall tax revenue increased 4.6 percent, according to official statistics released in May.
“We’re not concerned about slowing Chinese exports affecting GDP growth because the Chinese economy is shifting from an export economy to a domestic consumption economy,” said Alibaba Executive Vice Chairman Joseph Tsai on May 15 during a quarterly earnings conference call.
The largest e-commerce platform in China reported strong revenue growth of 51 percent in the last fiscal quarter.
Domestic consumption is $5.5 trillion at present, and consumption from third-, fourth- and fifth-tier cities will triple from $2.3 trillion to nearly $7 trillion in the next 10 years, Tsai said.
Major platforms are maintaining stable growth and those focusing on third- and fourth-tier cities are expanding faster, Cao Lei, head of China’s E-Commerce Research Center, told the Global Timeson June 2.
An expert also expressed his confidence over the country’s consumption, which has been the biggest driving force of China’s economy in the past five years, forecasting that consumption growth will remain in the range of 7 to 9 percent this year.
As reforms release more consumption power, and more advanced products and services are produced and developed at home, the consumption growth could offset the impact from the ongoing trade dispute, Tian Yun, vice president of the Beijing Economic Operation Association, told the Global Times on Sunday, June 2.
Final consumption expenditure contributed 65.1 percent to China’s economic growth in the first quarter, official data showed.
China’s overseas spending remains at a high level, however, which indicates that domestic education, healthcare, cultural products and services are still lagging behind consumers’ needs, Tian said.
The impact of the China-US trade dispute on China’s economy is being overestimated, Tian added, and even its impact on China’s exports is overestimated. Analysis should be based on the added value of exports, instead of the total value.
In recent years, regarding the consumer demand changing, Rugao World Flowers, in Jiangsu Province, guide growers to plant small and micro bonsai, and help the bonsai flow to people’s households through the organization of national marketing activities and online promotion. (Photo by Xu Hui from People’s Daily Online)