China's Double-11 Day 177 BILLION: Gold Rush or Smoke and Mirrors?

on 11/15/2016 - 09:08 am

According to China Daily, Alibaba, China's largest e-commerce giant, and the creator of the now famous Double 11 Online Shopping Day, reported sales of about 120.7 billion yuan ($17.79 billion) in 24 hours, during the world's biggest online shopping day of the year! Not surprising, their CEO Jack Ma, said he was very satisfied.

Alibaba Double 11 Global Shopping Festival Breaks Record 2016


International celebrities like Kobe Bryant, Scarlett Johansson and David Beckham joined Ma in hyping up consumers at the 2016 Tmall 11.11 Global Shopping Festival Gala in Shenzhen, Guangdong province on November 11th, 2016. 

Scarlett Johansson, Kobe Bryant and David Beckham at the 2016 Tmall 11.11 Global Shopping Festival Gala in Shenzhen, Guangdong province, Nov 11, 2016. [Photo/VCG]

Scarlett Johansson, Kobe Bryant and David Beckham at the 2016 Tmall 11.11 Global Shopping Festival Gala in Shenzhen, Guangdong province, Nov 11, 2016. [Photo/VCG]


On November 13, the China Daily also reported that according to Syntun, China's largest e-commerce data provider, China's 16 biggest e-Commerce sites racked in a total of 177 billion yuan (25.94 billion U.S. dollars) in a single day. This blows the U.S.'s biggest online shopping day out of the water! According to software firm Adobe, which tracks sales at 4,500 websites, Cyber Monday sales topped $3 billion, up 16% from last year; which is based on 200 million visits to 4,500 retail sites. However, according to the National Retail Foundation (NRF), total retail sales for the Black Friday weekend actually hit $102 billion; four times this year's Double 11 Online Shopping Day in China.

Although these numbers are huge, sales numbers in the U.S. are apparently dropping during the "special" shopping days.


Black Friday Weekend Shopping Statistics

The Balance: "What Is Black Friday? Sales Trends: Does Anyone Still Shop on Black Friday?"


There are many guesses floating around as to why the numbers are dropping. The global financial crisis and credit card debt are a couple cited by retailers; however, the general consensus among consumers we spoke with is that these shopping days have become BS. "Stores just raise their prices leading up to these shopping days just so they can say they are offering a big discount when really it's not much of a better deal, if at all, compared to buying any other day," one disgruntled shopper told us.


According to a CBS MONEYWATCH report entitled: Lies, damned lies and Black Friday sales statistics, "anytime you see that the statistics come from the National Retail Federation you should stop reading." (oops, but don't stop reading this article). Author Constatine von Hoffman writes that "The NRF has a powerful vested interest in making it seem like a good shopping weekend. The organization thinks this will encourage others to go shopping. Black Friday and its companion Cyber Monday are the recipients of some of the best PR work going."

CBS MoneyWatch


Like many great ideas around the world, things get copied. Is Alibaba simply copying what they believe was a great shopping motivator in the U.S.? Are they hyping people up to motivate them to buy more and more and more? If so, what happens when the adrenaline rush wears off and people wake up with their Double 11 hangover?

The morning after


We found some troubling statistics... although numbers in China are apparently booming, return on sales from these days are skyrocketing as well. According to a report published by China Internet Watch in 2015, the refund rate on Double 11 sales increased 69%! That's a staggering number. More so if you consider the huge cost that returns present to retailers.

False Prosperity Behind Double 11: Refund Rate Increased to 69%  Read more:


According to an article published by the Telegraph in 2015, worried retailers in the UK reportedly incurred costs of more than 10% of revenue dealing with returned goods. Author Laura Dickens cites the retail intelligence compay Clear returns stating that "UK retailers stand to lose £130m just from handling returns of items bought on Black Friday." She goes on further to explain that "Costs related to lost margins, cleaning and storing, oversupply of stock and the lost value of future custom from the shopper add a further £50m to the returns bill."

Shoppers scrambled to grab discounted TVs at a Tesco store last Black Friday  Photo: North News

Shoppers scrambled to grab discounted TVs at a Tesco store last Black Friday  Photo: North News


So next time you're caught up in one of these massive shopping day events you might actually be doing retailers a favor by staying home and watching tv with a pint of ice-cream. Better yet, why not head on down to Shekou and catch a show at your favorite live music venue over dinner and drinks.



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