Chinese retail giants tried to juice spending with iPhone and Lululemon discounts in an annual shopping bonanza

Chinese retail giants tried to juice spending with iPhone and Lululemon discounts in an annual shopping bonanza
Pls share this post

Listen to this article
618 Mall Promotion in Hangzhou
An e-commerce anchor sold 618 promotional goods on a live broadcast at a mall in Hangzhou, China, on June 18, 2024.

  • China’s 618 shopping festival faced challenges, despite creative strategies to attract shoppers.
  • Alibaba, ByteDance, and offered large discounts amid an uncertain economic environment.
  • By one measure, 618 sales — a barometer of consumer health — fell nearly 7% year-on-year.

China’s e-commerce platforms worked hard to attract shoppers during the country’s annual 618 shopping festival. But economic troubles got in the way of big sales.

The 618 promotion is a weeks-long event from late May to June 18, during which online platforms launch flash sales. This year saw internet companies like Alibaba, ByteDance, and offering steep discounts to woo Chinese consumers hit by persistent deflation, youth unemployment, and the property crisis.

READ ALSO  2 reasons why the South will stay the hottest housing market in the US

It’s is the second-biggest sale after Singles Day, which takes place in November and is likened to Black Friday in the US. The summer shopping festival is seen as a key indicator of China’s general retail temperature — and signs so far this year show that consumer spending is still muted.

In recent weeks, Alibaba offered a 50% discount on Lululemon clothing, sold some Apple iPhones at discounts as high as 20%, and TikTok’s sister company Douyin cut prices aggressively.

Luxury brands, which are seeing a purchase slowdown in China, joined the festival, too. Burberry livestreamed its 618 discounts, while Louis Vuitton offered shoppers a 30-minute virtual personalized shopping experience on WeChat.

After the end of 618, Alibaba and said sales grew, but neither reported specific figures.

READ ALSO  China's industrial push risks destabilizing the global economy and watering down green-energy exports, Janet Yellen warns

According to figures from Syntun, a Chinese third-party data agency, total sales on Alibaba’s Tmall,, and Pinduoduo fell 6.9% year-on-year. Total sales during the festival were 742.8 billion yuan, or $102.3 billion, the first time sales dropped in the eight years since Syntun started collecting data.

Home appliances, skincare, cosmetics and perfume, and personal care products were the top three categories in terms of sales, according to the data company.

The drop comes amid China’s slow post-pandemic recovery, as people exercise caution with their discretionary spending. According to a research note from Dutch bank ING published in May, Chinese consumers are cutting spending on clothing, cosmetics, and jewelry and instead choosing to spend their money on experiences like dining and sports. They are also flocking to safe haven investments like gold and supporting local manufacturers, instead of spending on overseas luxury brands like Gucci, Apple, and Starbucks.

READ ALSO  Chipotle says California's minimum wage pushed menu prices up nearly 7%

The slowdown may also stem from a plethora of year-round sales and discounts.

“The promotional period is too long, and all the marketing has gotten confusing,” said Constance Zhou, a 31-year-old who told the Financial Times she did not buy anything this year. “The platforms are always doing promotions. Regular shoppers don’t have any motivation to participate.”

Read the original article on Business Insider


Pls share this post
Previous articleLooks like Elon Musk just added Melinda French Gates to his list of billionaires’ ex-wives who ‘might be the downfall of Western civilization’
Next articleThis AI and automation developer bundle is only £47.39