November 11 was Singles Day in China. Started by a group of college students during the 1990s, Singles Day is when unmarrieds shower each other with gifts. I have read that 11/11 represents 4 bare sticks which sound like the Chinese word for bachelor or perhaps the date was chosen just because it is 4 ones. With 2 more ones, 11/11/11 was called the Singles Day of the Century. (It was also National Corduroy Day.)
Beyond a day to recognize singles, 11/11 has become associated with e-commerce. China’s online behemoth, Alibaba, reported $1.6 billion in revenue during the first 13 hours of 11/11–more than last year’s US Cyber Monday. Singles bought discounted clothing and furniture, special travel and restaurant deals, and one dealership even offered 23% off BMW 3 series cars. The Economist said that, “Couriers were buried in parcels.”
Our bottom line? Analyses of the Chinese economy point to excessive household saving, inadequate consumer spending and too much dependence on exports and investment. With rebalancing a goal, any consumer spending binge is good news. In China’s newest 5-year plan (2011-2014), China, hopes to see online spending quadruple.
Sources and Resources: The most interesting articles on Singles Day were from Business Insider, USA Today, and The Economist (and the source of the above courier quote). A good, brief discussion of China’s economic challenges, this FT article also clearly conveys their progress. Finally, in this econlife post, we looked more closely at the Chinese consumer and shared the table that follows from McKinsey.
Chinese Urban Households: Disposable Income/Proportion of Urban Population
|Household Type:Annual disposable income||2010(total of 226 million households)||2020*(total of 328 million households)|
|Affluent(More than $34,000)||2%||6%|
|Mainstream($16,000 to $34,000)||6%||51%|
|Value($6,000 to $16,000)||82%||36%|
|Poor(Less than $6000)||10%||7%|