Alibaba Singles’ Day Growth Slumps Amidst Crackdown

Alibaba’s Singles’ Day, the world’s biggest e-commerce event, registered its slowest growth to date this year amidst a regulatory crackdown by China’s regulators.

The 11-day event grew by 8.5 percent over last year, the slowest rate since it was launched in 2009.

It was the first time the sale has failed to show double-digit growth.

However, sales still reached a record of 540.3 billion yuan ($84.5bn, £63.2bn).

Slower growth

The event, which Alibaba calls the “11.11 Global Shopping Festival”, and is also known as Double 11, began as a 24-hour flash sale event.

Over the years has grown into a multi-day extravaganza ending at midnight on 11 November.

E-commerce rival JD.com also holds its own version of the sale, and said sales totalled 349.1bn yuan, up 28 percent from last year.

For both companies this year’s Singles’ Day was a more muted affair than usual, with an increased emphasis on sustainability and philanthropy, in line with President Xi Jinping’s goals for the economy.

Jinping has pushed for common prosperity for all while regulators have imposed tough new rules on internet giants, following years of minimal oversight.

Alibaba paid a record $2.8bn fine in April after a probe found it had long abused its dominant market position. The company also agreed to change its business practices.

Regulatory crackdown

“This 11.11 Global Shopping Festival, we delivered steady and quality growth that is a reflection of the dynamic Chinese consumption economy,” said Alibaba vice president Yang Guang in a statement.

“We also leveraged the power of 11.11 as a platform to fulfill our social responsibility. This year’s festival was a meaningful milestone as part of our commitment towards building a sustainable future.”

Alibaba sold eco-friendly products and raised money for good causes during this year’s event, with one livestream encouraging users to donate to an elephant reserve.

JD said it had reduced carbon emissions by 26,000 tonnes during this Singles’ Day period compared with last year.

Economic concerns

The company said it saw the most growth in purchases of luxury products and pet-related goods.

Apple also saw strong sales, with JD saying transaction volume of iPhones passed 100m yuan in 2 seconds after the final sales began on 10 November.

Slower economic growth in China may also have contributed to the tone of this year’s event, with China’s economy growing by 4.9 percent year-on-year in the July to September quarter, worse than analysts had predicted.

Power shortages, fresh Covid-19 outbreaks and concerns about the property market are also currently weighing on the world’s second-biggest economy.