Alibaba, China's largest online retailer, turned the day into an excuse to go shopping six years ago, when it began offering special deals on the holiday in 2009. Since then, the company's sales have climbed precipitously. This year, a total of $14.3 billion in goods were sold through Alibaba's platform on Singles Day, up from $9.32 billion last year.
To put that in perspective, that's about four times as much as what U.S. consumers spent last year online on Black Friday and Cyber Monday combined.
Within 8 minutes of midnight, when the sales began, Alibaba had sold more than $1 billion in goods. The Chinese post office estimated that 760 million packages would be shipped by various e-commerce sites on just that one day.
The day is such a big deal that Alibaba hired actor Kevin Spacey to do a promotional bit as "House of Cards" president Frank Underwood -- a character who is particularly beloved in China.
One of the most fascinating things about this shopping holiday is that it offers a glimpse into an industry where China is outpacing and outperforming the United States.
We're used to thinking that China does a lot of low-level manufacturing but still falls behind advanced countries when it comes to innovation and advanced technology. And for some industries that's true -- in airplane manufacturing, for example, China remains maybe a decade behind.
But in other high-tech areas, China is surprisingly advanced -- such as DNA sequencing, mobile advertising and e-commerce. On average, Chinese people seem much more comfortable buying goods online, and Chinese Web sites tend to have rolled out a much wider array of goods and services for online customers.
There are a few reasons for China's success in e-commerce. One is that, for many Chinese businesses, it has made sense to leapfrog brick-and-mortar expansion and go straight to promoting their products online. China is a geographically large and heavily populated country. For most retail chains, ensuring that a significant portion of Chinese customers have access to their stores would mean undertaking a huge amount of construction.
At the same time, the Chinese have been very quick to get online and specifically to adopt mobile Internet. A report released earlier this year by the Global System for Mobile Communications Alliance said that China has among the world's highest penetration rate for smartphones, with 62 percent of Chinese owning smartphones during the first three months of the year, compared with 55 percent of Europeans.
Unlike people in the United States, many Chinese went directly to using mobile Internet without ever going online through a desktop or laptop computer. And many Chinese have become very comfortable shopping on their phones, a boon for the e-commerce industry. That's especially true for Chinese consumers outside the country's major cities. Demand from China's smaller cities helped e-commerce revenues expand at more than 70 percent per year between 2009 and 2012, according to research by KPMG, a consultancy.
As the chart below, from the consultancy Bain & Company, shows, a higher percentage of retail sales were made online in China than in the United States, Germany, Japan or Canada. In the first hour of Singles Day this year, Alibaba said, 73 percent of purchases on its platforms were made via mobile phone.
Another reason that China's e-commerce sector is so developed is that competition is pretty fierce. One company dominates the industry -- Alibaba accounts for more than 80 percent of online sales in China -- but there are other contenders, like JD.com, Tencent and Suning, fighting for a piece of its business. That has encouraged both innovation and customer-friendly practices and prices.
In the run-up to this year's Singles Day, an executive from Alibaba said in a statement that "the whole world will witness the power of Chinese consumption." If that isn't true yet, it likely will be soon.
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