Year after year, online retailers post new Singles’ Day sales records. The shopping spree has become an economic miracle in the past decade. But after the dust settles, price competition leaves a dent in Singles’ Day results. The bonanza cannot become an engine for consumption and real economic growth if it’s just a time to tout the biggest discounts.
Many Singles’ Day shoppers delay some of their planned purchases until the shopping spree, and that means there’s no significant increase in total consumption. In recent market study released by Bain & Company in March, Chinese consumers buy one-third of the world’s luxury goods. The country’s consumption upgrading has increased its demand for luxury goods. However, low-price competition has made Singles’ Day less attractive for luxury brands, which win consumers based on reputation rather than discounts. If Singles’ Day only targets middle- to low-end products instead of the luxury market, its growth is unlikely to be sustainable.
Western brands are especially good at high-end production instead of labor-intensive goods. If Alibaba looks beyond China’s borders to turn Singles’ Day shopping spree into a global phenomenon, it will encounter difficulties sooner to avoid becoming a battleground of bargains.
The author is a reporter with the Global Times. bizopinion@globaltimes.com.cn
Year after year, online retailers post new Singles’ Day sales records. The shopping spree has become an economic miracle in the past decade. But after the dust settles, price competition leaves a dent in Singles’ Day results. The bonanza cannot become an engine for consumption and real economic growth if it’s just a time to tout the biggest discounts.
Many Singles’ Day shoppers delay some of their planned purchases until the shopping spree, and that means there’s no significant increase in total consumption. In recent market study released by Bain & Company in March, Chinese consumers buy one-third of the world’s luxury goods. The country’s consumption upgrading has increased its demand for luxury goods. However, low-price competition has made Singles’ Day less attractive for luxury brands, which win consumers based on reputation rather than discounts. If Singles’ Day only targets middle- to low-end products instead of the luxury market, its growth is unlikely to be sustainable.
Western brands are especially good at high-end production instead of labor-intensive goods. If Alibaba looks beyond China’s borders to turn Singles’ Day shopping spree into a global phenomenon, it will encounter difficulties sooner to avoid becoming a battleground of bargains.
The author is a reporter with the Global Times. bizopinion@globaltimes.com.cn