618: China’s biggest mid-year e-commerce festival to stimulate global economic recovery
China is host to some of the world’s biggest record-breaking e-commerce festivals that span throughout the whole year. Of the two most important festivals are the 618, held from June 1st to June 18th by JD.com, and the Double 11 (Singles Day), which now spans over a week in November until the 11th, by Tmall/ Taobao. Luxury brands, as well as SMEs from all over the world, participate in these festivals, racking up large sums of money while also driving up consumption. During the pandemic, it has become a lifeline for many brands both within and outside of China. This is further supported by the government’s role in providing discount vouchers and coupons to drive up consumption and speed up the pandemic recovery process. With pre-sales for the 618 e-commerce festival having begun on May 24th, this year’s festival is expected to bring about another miraculous spike in Chinese consumption.
A look back at the 2020, 618 festival
In 2020, over 100,000 brands in Tmall took part in the 618 festival, and data from the NetsUnion Clearing Corporation (NUCC) showed that total transactions were about $2.38 trillion, up 42% from 2019. At the same time, direct purchases of imports from overseas warehouses grew 199% year-on-year with import consumption increasing by 43% year-on-year. E-commerce platform JD.com (JingDong) also saw significant growth with a 110% year-on-year increase in sales in their cross-border e-commerce platform by introducing over 30,000 new international products to Chinese consumers. The largest import sectors to benefit during this time included pet products (400% year on year), beauty products (180% year on year) as well as electronics, maternal & baby products, health care, and fashion products, all achieving over 100% year-on-year growth. Over the 18 day event, brands from over 30% of participating countries experienced doubled sales of their products.
With the changing face of new consumer habits in China, making a connection with consumers has become ever-growingly impactful for businesses partaking in China’s markets. That is why brands unleashed several marketing campaigns and promotional activities including offline pop-ups, online content, live-streaming, strategic discounts, and activities that grabbed the attention of eager shoppers. This includes the recruitment of KOLs, celebrities, and other influencers to drive traffic to relevant sales channels within the Chinese digital ecosystem. In doing so, consumers are able to better relate and quickly find the needed information on the best products at the most affordable prices from the most trusted sources that brands make available to them.
Global Impact of cross border spending
By analyzing specific industry growth within the China market and the needs of Chinese consumers, we can better understand the positive impact that China’s cross-border spending brings. One major example is the Durian, a pungent fruit that is considered a delicacy in many parts of China. With its growing popularity within China, imports of this fruit jumped up by four times to $2.3 billion from 2017. Coupled with the stop of Durio Tourism in which Chinese travelers visit farms in Malaysia and Thailand to taste fresh Durians, Malaysia saw a significant increase in demand for the fruit with companies like MAPC Sdn. Bad. exporting up to 90% of its durians to China. Other sectors like international wine and pet healthcare products also saw sales growth exceeding 20 times year on year just within half a day during Alibaba’s Tmall 618 festival.
The momentum keeps growing in 2021
As expected with China’s exponentially growing digital markets, 2021’s 618 festival is expected to introduce a much bigger scale that seems impossible during the pandemic. On June 1st, Alibaba reported that its international sales channels surpassed the record of the first day of the previous year within 8 hours. Tmall revealed a total of 250,000 participants for this year’s 618 festival with 13 million products handing out discounts, of which, 1.4 million being newly listed products on the platform. In order to meet the growing consumer trend of influencer live-streaming, they are also enlisting over 100 celebrities and KOLs to stream for a majority of merchants to interact with their fans and provide discounts.
Competitor JingDong also shifted its focus to high-quality content marketing through live streaming, short videos, graphics, and interactive quizzes to support its 618 promotion. They are enlisting over 1,900 celebrities, brand partners, KOLS, and professional buyers to further strengthen their promotion efforts. Such efforts are paying off as major brands as well as local Chinese brands saw immense growth with brands like LEGO, Unilever, and local infant milk formula brand Feihe, seeing over 10 times year on year sales growth during the festival.
Other competitors such as Kuaishou, Douyin, Meituan, and Pinduoduo are showcasing similar approaches to capitalize on this event. Meanwhile, Shake to Win is also partaking in the event featuring special promotional discounts on select products during its special live streaming session on the 18th of June. If you would like to know more about us or are interested in any business collaboration please contact email@example.com.