China's economic rebalancing towards more consumer-oriented growth has global businesses cautious, but pessimists need only look at the country's annual e-commerce event for a powerful reminder of consumer buying power.
Created by a group of young Chinese in the 1990s, the holiday known as Singles Day was originally a way to celebrate single life. Held on November 11 every year, it's popularly described as 'China's anti-Valentine's Day.'
As the holiday acquired nation-wide popularity, Alibaba became the first major company in 2009 to monetize the holiday by launching a special online sale and effectively transforming the day into the world's biggest 24-hour online shopping event, one that reflects the growing wealth of China's middle-class. Other e-commerce players like JD.com have since began offering their own Singles Day sales too.
This year, the holiday—also referred to as Double 11—could record its best performance yet.
According to a new Nielsen survey, 56 percent of more than 1,000 internet users in China said they would increase spending compared with 2014. The average expected spend amongst all respondents this year is 1,761 renminbi, or $277—an increase of 22 percent from last year, Nielsen added.
If correct, that could likely see Alibaba sales hit $10 billion in a 24-hour period for the first time.
Last year, the e-commerce behemoth booked a record $9.3 billion in sales, more than four times the $2.4 billion sold on Cyber Monday, the biggest online sales day for the U.S. that falls on the first Monday after Thanksgiving.
"It's not a huge surprise that consumers are planning to spend more during this year's 'Double 11.' Income levels and internet penetration continue to rise throughout China, so this is a natural progression," said Yan Xuan, President of Nielsen Greater China.