Web Shoppers Turbocharge Shopping on China's Version of Black Friday

(Beijing) — Young, web-savvy bargain hunters turbocharged this year's Singles Day shopping extravaganza in China on Friday, helping the nation's two leading e-commerce sites post strong gains in what is rapidly challenging Black Friday as the world's biggest shopping day.

Despite the gains, midday figures from Alibaba Group Holding Ltd. and JD.com showed slower growth than the previous year, reflecting the inevitable slowdown for a day that started out as a celebration of singledom before morphing into its current form over the last eight years.

Online merchants offer big discounts to boost sales during the event, with price cuts of 50% or more frequently available for price-conscious shoppers. Some retailers have been accused of raising prices just before the date to make their discounts look bigger than they really are, though the negative publicity hasn't dampened enthusiasm from bargain hunters.

Singles Day — Nov. 11 — got its name from some university students in 1993 due to the four "1's" in the date's shorthand. As it has grown into a shopping day, Singles Day has been increasingly compared to Black Friday, the day after Thanksgiving in the United States. The U.S. Thanksgiving is the fourth Thursday of November, and the following day is when that country's brick-and-mortar retailers traditionally offer deep discounts to customers wanting a head start on Christmas shopping.

An increasingly web-savvy group of Singles Day consumers employed a wide range of shopping tactics to get what they wanted, many loading up virtual shopping carts on Thursday and then staying up until just past midnight on Friday to push the "buy" button. Many complained of difficulties making payments as the 24-hour festival began, and at least one major chain ran out of merchandise for its promotion less than halfway through the day.

Alibaba said its gross merchandise volume (GMV), the total value of all goods sold over its e-commerce platforms, reached 91.2 billion yuan ($13.5 billion) by 3:19 p.m. on Friday. Alibaba rival JD.com said its Singles Day orders were up 78% in the first half of the day, though it didn't provide any specific sales figures.

If sales continue at the current rate, Alibaba's final GMV figure for the shopping day will hit about $20 billion, up about 50% from last year, slowing from last year's 60% growth rate. JD's 78% growth in the first half of the day was also sharply slower than last year's rate of 130% growth for the entire day.

Many young online shoppers surveyed by Caixin made their purchases in the middle of the night to avoid getting a "sold out" response when they placed orders. Clothing was one of their biggest purchases, especially winter wear. Many did most of their actual shopping before Friday, putting goods in online shopping carts to wait for promotional prices to kick in on the actual day that sales began.

"I started shopping at around 11 p.m. (Thursday), but even before that I had put a lot of things I wanted to buy into my shopping cart," said graduate student Li Mengxin. "Most of my purchases were winter clothes that usually cost a lot, so the discounts were worthwhile."

A number of people surveyed did their shopping at the online store of Japanese fast-fashion chain Uniqlo, resulting in a run on the company's low-cost clothing. As a result, a sign on Uniqlo's site before noon informed web surfers that all of its Singles Day promotional merchandise had been sold out.

"I bought 1,600 yuan worth of clothing on Uniqlo, and saved more than 700 yuan," said Duan Sinian, a student in Shanghai, who went back later in the morning only to discover the "sold out" notice. "Then I went to some other stores and spent another 700 yuan and saved 300 more."

Some buyers reported frustration while making purchases in the first hour of the shopping day. Alibaba said that the GMV passed the $1 billion mark in just the first five minutes after midnight Friday and was well past the $5 billion mark at 1:11 a.m. That buying crush caused many computers to freeze as payment processing platforms became overwhelmed.

"At midnight I got on Tmall to buy some pomelos and aloe vera teas, and some exercise shoes and lipstick, which saved me 320 yuan," said Zhu Chunyang, another online shopper in Shanghai. "But when I went to the checkout counter, the payment system froze and I had to refresh the page continually."

Contact reporter Doug Young (dougyoung@caixin.com); editor Ken Howe (kennethhowe@caixin.com)