(CapitalWatch, June 1, New York) Chinese retailers have kicked off their promotions for the mid-year annual shopping festival, called "618," to conclude on June 18. And it's quite an opportune time for the wild spree: Shanghai's post-lockdown reopening came as a huge relief and the city has indeed been festive.
During the 618 festival of 2021, China's e-commerce titans Alibaba (NYSE: BABA; HKEX: 9988) and JD.com (Nasdaq: JD; HKEX: 9618) once again broke previous records. JD booked $53.2 billion in sales compared with $38 billion in June 2020. This was despite Beijing's then-new regulations that prohibited exclusive merchant contracts in an anti-monopoly push.
Alibaba did not disclose its 2021 results of the 618 festival, but said it attracted a record number of brands. A survey from Yibang at the time showed the majority of enterprises invested more into Alibaba's Tmall shopping platform than into JD.com, as demonstrated by China Internet Watch.
After Beijing's massive 2021 crackdown on the tech sector and Alibaba specifically, the company has been cautious on promoting the festival. Its corporate website Alizila.com features Alibaba's actions on social responsibility like supporting merchants and consumers in Shanghai as businesses reopen and improving liquidity for SMEs with faster money transfers.
As stated in the report about Alibaba's delivery service Ele.me, "Ele.me will launch RMB500 million in subsidies to boost confidence in the consumption market, with RMB200 million going to merchants and the rest distributed as red packets and promotions to consumers."
Alibaba said it launched the 618 promotions on May 26, freezing prices and offering vouchers and discounts. Alibaba-owned Intime slashed clothing prices by 32% and dine-in orders by 50%, and other perks were announced.
As to JD, its corporate blog was not as reserved about the grand event. In a statement today, JD said it kicked off the festival on May 31 after an eight-day pre-order phase and already logged surging sales. As its promotion move, JD offers a 50-yuan discount on every purchase over 299 yuan.
Both online retailers noted increased protection for consumers this year.
The stock in Alibaba ended about 3% lower on Wednesday in New York; JD.com inched 0.59% down amid a general pullback in the markets.