China's mid-year online shopping bonanza paves way for consumption recovery

Staff members transport packages at a logistics center in Zhengzhou, central  China's Henan Province, Nov. 11, 2021. (Xinhua/Zhang Haoran)

BEIJING, June 5 (Xinhua) -- China's weeks-long mid-year online shopping event  got off to a steady start amid business resumption and pro-growth policy incentives, which analysts believe can help boost consumption as  COVID-19 impacts wear thin.

The annual shopping bonanza, featuring promotional campaigns at multiple  e-commerce platforms, kicked off on June 1. Many online retailers said  sales took off in the beginning hours, especially on upscale big-ticket  items.

The first 4 hours of JD.com's campaign saw sales of gaming television top  that of last June as a whole, while sales of smartphones costing over 4,000 yuan (about 596 U.S. dollars) from six brands tripled year on  year.

Suning reported a 78-percent year-on-year sales increase on high-end home  appliances of over 10,000 yuan during its first round of the campaign,  while the number of customers trading in old items for new ones rose 56  percent from a year ago.

The whopping growth is backed by the recovery of the retail sector, as the  country accelerates the implementation of policies to stabilize the  economy. Industry activity gauges for warehouse storage, logistics and  e-commerce logistics have all perked up in May from a month ago while  posting upbeat expectations for further expansion.

Shanghai, for instance, handled an above-average daily total of 11 million  express delivery packages on June 1, the first day of its return to  normal production and life after two months of closed-off management to  contain the COVID-19 resurgence.

Tempting prices and generous giveaways at e-commerce platforms also fueled  shoppers' passion. JD.com and Pinduoduo have collaborated with cities  like Beijing, Shenzhen and Shanghai to issue vouchers for customers to  use on top of already reduced prices.

With the help of these incentives, the year's major online shopping event  will serve as a strong driver of consumption, which was dampened by  COVID-19 flare-ups, said Li Mingtao, an analyst with China International Electronic Commerce Center.

Online outlets are taking up increasingly larger shares of China's consumer  product market. In the first four months of this year, online sales of  physical goods rose 5.2 percent, with its proportion in retail sales  climbing to 23.8 percent.

These outlets are pooling their resources along the supply chain, including  nationwide warehouse networks and internet traffic, to expand sales for  struggling small and medium-sized firms.

Noting that small businesses, like many vendors on e-commerce platforms, are  the main targets of supportive policies, Zhao Ping, vice president of  the Academy of China Council for the Promotion of International Trade,  said these platforms can help free them from constraints in the  financing, technology, marketing and human resources by offering digital solutions.

China will step up the integrated development of online and offline shopping, and nurture new consumption trends like customization and experiential  shopping, said Vice Minister of Commerce Sheng Qiuping.

The country has rolled out a series of detailed measures to further tap its consumption potential and tackle short-term bottlenecks, including  relaxing restrictions on car purchases and handing out billions of yuan  in shopping vouchers.