- Title: Alibaba Singles' Day sales pass 2015 total, but growth rate slows
- Date: 11th November 2016
- Summary: PRODUCTS IN VIRTUAL STORE BEING SEEN IN VR GLASSES
- Embargoed: 26th November 2016 10:17
- Keywords: Alibaba singlesday sales consumer
- Location: SHENZHEN CITY, GUANGDONG PROVINCE, CHINA
- City: SHENZHEN CITY, GUANGDONG PROVINCE, CHINA
- Country: China
- Topics: Economic Events
- Reuters ID: LVA0025801NB9
- Aspect Ratio: 16:9
- Story Text: Alibaba Group Holding Ltd.'s Singles' Day sales surged past last year's 91.2 billion yuan ($13.36 billion) total with nearly nine hours left on the clock, but growth was markedly slower than in 2015 as shoppers sought even bigger price cuts.
Amid fanfare and celebrity razzmatazz, sales on Alibaba's platforms had raced to a billion dollars in under five minutes and within the first sixty minutes had passed $5 billion - a third faster than 2015 as the e-commerce giant looked to shrug off a domestic economic slowdown and a U.S. accounting probe.
The 24-hour event held annually on November 11 offers a benchmark for Alibaba's performance and an insight into China's swing to online shopping, especially via smartphones. Launched in 2009, Alibaba's version of the event was designed to encourage consumers without a partner to treat themselves.
Sales growth was down from last year's 60 percent amid a more saturated domestic online retail market, a weaker economy and sluggish personal income growth. A strong U.S. dollar also hit the headline sales figure in dollar terms.
The discount shopping day, also known as "Double 11", still shifts more goods than Black Friday and Cyber Monday in the United States combined. Sales on Alibaba platforms, including Tmall and Taobao, are tipped to exceed $20 billion this year.
After a beefed-up marketing push over the last month - with fashion shows and virtual reality games - sales officially opened at midnight, releasing a wave of pre-orders that shoppers had placed ahead of the event. Sports stars David Beckham and Kobe Bryant attended the countdown, though headline act Katy Perry pulled out last minute citing a "family" issue.
At 3:19 p.m. (0719 GMT) a live sales tracker at Alibaba's main event in the southern Chinese city of Shenzhen passed the 2015 yuan total, ensuring the day will set a new record but, in dollar terms, was still short of 2015's $14.3 billion.
The rise of Singles' Day reflects how China's consumers, armed with smartphones, are racing online to shop - to the detriment of bricks and mortar stores. So far on Friday (November 11), 83 percent of sales were via mobile devices, up strongly from last year, Alibaba said.
Michael Evans, Alibaba Group Holdings President said at a briefing on Friday that the future consumers were those who were emerging into the middle class.
"The most important consumers of the future are five of seven billion people that live in this part of the world who are emerging into the middle class, who are looking more like Chinese consumers today, even though they live in Southeast Asia and India and Russia, Brazil, in addition to the consumers that live in Europe and U.S. that we already know about. So that consumption, the growing consumer base, is a fundamental precondition of what we believe in," Evans said.
In May this year, Alibaba said the U.S. Securities and Exchange Commission (SEC) was looking into how it reports its Single's Day figures. Alibaba said at the time it was cooperating with the authorities, and that the SEC advised it the investigation should not be seen as an indication the company had violated federal securities laws.
Evans declined to comment on the SEC probe, but said their report was accurate all the time and the disclosed metrics were being audited.
"The metrics which we want to disclose are being independently audited by PWC. So we want people to have confidence because we have confidence that we report things accurately all the time, not some of the time, but all of the time. But we want to have people to be confident based on an independent review of those numbers. So that's taking place. Those are the metrics we disclosed, they will be audited and they will be looked at by PWC. We feel very very comfortable with that," he said.
Media staff were invited to try on Virtual Reality glasses to experience virtual reality shopping at the Media Centre on Friday.
Alibaba is not the only retailer to mark November 11 with a massive sales drive. China's No. 2 e-commerce player JD.com Inc and many others also offer discount deals on the day. - Copyright Holder: REUTERS
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