JD.com’s 618 shopping fest: Rapid delivery, $1.3B in discounts boost sales

This year’s iteration of JD.com’s annual 618 Shopping Festival began on May 31 at 8pm. Initial data from China’s second biggest annual retail event reveal robust consumer demand and swift sales growth. Prominent domestic and international brands, including Apple, Midea, Gree, Haier, Xiaomi, and gold jewelry brand China Gold, quickly surpassed the 100 million RMB ($13.8 million) sales mark, within minutes, if not seconds. As of midnight, over 10,000 brands saw sales surge fivefold year on year. What attracts online shoppers? JD.com’s substantial discounts, amounting to 10 billion RMB ($1.3 billion), have hooked shoppers. These subsidies cover nearly 600,000 low-priced products from well-known brands. In the first hour alone, orders in the event’s “10 billion RMB discount” segment rose over 50% YoY. The nearly 500,000 products available at 9.9 RMB ($1.37), with free shipping, attracted an influx of buyers, over 75% of whom were located in third-tier and lower-tier cities. Penetration of less urbanized markets indicates new traffic pools for merchants to tap. Efficient logistics is a key competitive advantage for JD.com. One customer from Beijing Chaoyang District received her order of Huoxiang Zhengqi Water just four minutes after placing it, highlighting the platform’s rapid delivery capabilities. Over 60% of consumers in a pre-event survey said that while price is crucial, other factors like brand reputation, quality, logistics, and value-added services create a comfortable shopping experience. JD.com’s 40 smart industrial parks operate around the clock to ensure timely order processing. Many orders placed during the initial hours of the 618 Festival were shipped out within 10 minutes, with consumers in cities like Changji in Xinjiang province receiving their goods almost immediately. JD Logistics has also expanded its operations in Hong Kong, achieving next-day delivery for 80% of orders there and nearly doubling year-on-year order volume in the first four hours. Fashion, beauty, luxury, and jewelry results With the arrival of summer, consumers are refreshing their wardrobes and investing in beauty and sports equipment. Within the first four hours of the event, sales of over 2,500 clothing brands, including popular contemporary labels Edition, GXG, and Dzzit, doubled year on year. The growing popularity of sunshield clothing, evidenced by a 100% YoY increase in GMV, highlights the rising demand in the sun care market. Hanfu brands, reflecting growing cultural confidence, saw significant gains, with sales of popular hanfu labels, Shisanyu (十三余) and Zhizaosi (织造司), increasing by over five times year on year. Beauty and gold jewelry remained highly sought after, with more than 300 beauty brands, including Bioderma, L’Occitane, and Nars, achieving over 100% YoY GMV growth. Chinese beauty brands like Timage, Kefumei, and Fuerjia saw even more impressive gains, with sales increasing by over 350% YoY. Gold jewelry brands such as Lao Miao, Chow Tai Fook, and Laopu Gold reported sales growth of over 200% YoY. Luxury brands also performed well, with Loewe’s sales increasing by more than 250% YoY, Tiffany’s by over 100% (fueled in part by a recent mystic trend), and Alexander Wang’s by 450%. Surging demand for outdoor activities was reflected in the 100% YoY increase in sales of cycling wear, golf equipment, and other categories, and the 600% increase in electric skateboard sales. EVs, wellness on the rise The electric vehicle (EV) sector is another area growing strongly. With the expansion of EV ownership in China, sales of EV tires increased 280% YoY. Additionally, orders for electric vehicle battery delivery, installation, and recycling services rose by over 350% YoY. The wellness sector is also booming, driven by a move to healthier living. Within the first four hours, orders for physical examination and medical beauty services doubled year on year. Sales of health functional beverages increased by 145%, and antioxidant products sales climbed 65%. JD.com’s focus on cross-border e-commerce has resonated with Chinese consumers, who are eager for quality international products at competitive prices. In the first four hours, sales of over 180 brands on JD.com International more than doubled year on year. Beauty and skincare brand Evidens de Beauté saw its sales double year on year; luxury fashion brand Salvatore Ferragamo’s sales doubled; and Van Cleef & Arpels saw over 100% YoY sales growth. In the wine category, Penfolds and Remy Martin’s sales increased more than fourfold year on year. The trends emerging this 618 Festival reflect a broader shift towards digital integration, cultural confidence, and healthier lifestyles among Chinese consumers. The significant participation of residents from third-tier and lower-tier city residents indicates deepening market penetration, while the rise in cross-border sales highlights growing demand for quality international products, a boon for international luxury brands.

JD.com’s 618 shopping fest: Rapid delivery, $1.3B in discounts boost sales

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Published June 06, 2024

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JD.com’s 618 shopping fest: Rapid delivery, $1.3B in discounts boost sales