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CNBC
4 hours ago
- Business
- CNBC
Is China going through a consumption revival? Its 618 festival is one sign of it
China's latest shopping festival, which wrapped up Wednesday, pointed to a pickup in consumption, as e-commerce companies reported strong sales of consumer electronics, as well as beauty and pet care products. The 618 festival is one of the biggest promotional periods of the year in China as Alibaba, and other major Chinese e-commerce platforms roll out discounts. This year, the festival's gross merchandise value, a measure of sales over time, surged by 15.2% from last year to an estimated to 855.6 billion yuan ($119 billion), according to retail data provider Syntun. That points to some recovery in consumption, after Syntun data for last year's 618 festival revealed a year-on-year decline in sales for the first time in eight years. However, as has been the case with other annual shopping events, retailers expanded the promotional period to start May 13, a week earlier than in 2024, before ending June 18. Still, said the number of shoppers participating hit a record high, more than doubling year on year between May 30 and June 18 to an unspecified figure. More than 2.2 billion orders were recorded across JD's channels, which include online and offline stores, food delivery and quick commerce, according to the retailer. Investors were surprised Monday by a better-than-expected 6.4% increase in national retail sales in May from a year ago — the fastest increase since December 2023, according to official data accessed via Wind Information. Chinese consumers are spending "a lot of money on outerwear. Cosmetics and beauty doing really well," Jacob Cooke, co-founder and CEO of WPIC Marketing + Technologies, told CNBC on Friday. The company helps foreign brands — such as Vitamix and iS Clinical — sell online in China and other parts of Asia. His firm estimates that gross merchandise value during 618 grew by around 14.1% from a year ago, pointing to a slightly slower increase than what Syntun reported. He also pointed to growing numbers of customers outside of China's big, well-known cities, based on the packages he's seen leaving his company's warehouse. Beijing's trade-in program to subsidize certain consumer products such as consumer electronics helped boost sales. Household appliances emerged champion among the categories, bringing in 110.1 billion yuan in sales, while beauty and skin care products clocked in 43.2 billion yuan in sales, according to Syntun. Similarly, Chinese e-commerce giant Alibaba's Taobao and Tmall reported strong sales in categories eligible for government subsidies — with initial sales more than tripling from the same period around the Nov. 11 Singles' Day shopping festival, indicating increased consumer interest in the newest batch of subsidies. Taobao's generative artificial intelligence tools also boosted sales. Its image-to-video feature and an advanced marketing bidding model boosted campaign return on investment by an average of 12%, the company said earlier this month. That echoes how Alibaba and other major Chinese companies reported improved first-quarter consumer sales, bolstered in part by AI-powered marketing tools. Shoppers are also splurging on their pets. Taobao and Tmall noted a surge in demand for pet care products, as total sales in the first 100 minutes surpassed the total sales from the first four hours of the same period last year. But despite strong sales, the mid-year e-commerce festival lost some steam toward the end after some Chinese provincial governments ran out of money to keep offering trade-in subsidies, Chinese media Yicai reported Thursday. "We believe the June 18 promotion this year could have been stronger, had the trade-in subsidy program remained intact," Nomura analysts said in a note Thursday. The analysts added that of 32 mainland China regions, around a dozen have suspended trade-in programs. State-run news agency Xinhua on Friday refuted claims that regions had canceled the subsidies. Xinhua on Friday also reported that Chinese consumers can expect more consumer goods subsidies from the government as early as July. This year's 618 festival lasted over a month, running from May 13 to June 18. While retail sales have improved in that period, experts warn that the prolonged duration of such festivals could reduce the incentive for consumption. "If you do have these festivals, and that's becoming more regular feature of these online platforms that these discounts, rebates and special offers, they continue all throughout the year in different guises, then it becomes difficult for the average consumer to keep on participating in them," said Manishi Raychaudhuri, CEO of Emmer Capital Partners, on CNBC's "The China Connection" on Friday. Instead, the government and companies will have to think of more innovative ways to boost domestic consumption, he added. Beijing has opted not to hand out cash to consumers, instead focusing on subsidies for specific products and incremental measures to support employment.
South China Morning Post
5 hours ago
- Business
- South China Morning Post
Unitree Robotics reaches unicorn status with ByteDance, Alibaba, Tencent funding
Unitree Robotics , a leading player in China's booming robotics industry, has completed a new round of financing, attracting investment from some of the country's biggest tech companies amid excitement surrounding this sector. The Hangzhou-based company, founded by Wang Xingxing , was valued at over 10 billion yuan (US$1.3 billion), according to investors and local media reports. Notable backers in the latest funding round included ByteDance-affiliated Jinqiu Capital, Alibaba Group Holding and affiliate Ant Group, Tencent Holdings, China Mobile and carmaker Geely Group. Alibaba owns the South China Morning Post. Jinqiu partner Zang Tianyu said in a statement that Unitree was the world's top producer of quadruped and humanoid robots. He stressed that the start-up had the potential to lead advances in humanoid robotics, leveraging its extensive expertise across hardware and software. 10:41 How Hangzhou's 'Six Little Dragons' built a new Chinese tech hub How Hangzhou's 'Six Little Dragons' built a new Chinese tech hub Unitree gained national fame when its humanoid robots showcased their dancing skills at the annual Lunar New Year's Eve gala on China Central Television. Wang, 35, has become a prominent figure among China's new generation of entrepreneurs after attending a high-profile symposium hosted by President Xi Jinping in February.
South China Morning Post
11 hours ago
- Business
- South China Morning Post
Hong Kong stocks gain as PBOC's benchmark-rate choice spurs optimism on economy
Hong Kong stocks rose on Friday, paring the week's losses as China's decision to stand pat on a benchmark interest rate offered optimism that a recovery in the world's second-largest economy would hold up. Advertisement The Hang Seng Index climbed 0.6 per cent to 23,372.46 as of 10.10am local time, trimming the weekly loss to 2.1 per cent. The Hang Seng Tech Index gained 0.5 per cent. On the mainland, the CSI 300 Index and the Shanghai Composite Index added at least 0.1 per cent. Sunny Optical Technology Group advanced 3.7 per cent to HK$65 and sportswear maker Li Ning rallied 2.8 per cent to HK$15.42. China Life Insurance added 2.5 per cent to HK$18.20. Alibaba Group Holding rose 0.4 per cent to HK$110.40. China left the one-year loan prime rate at 3 per cent this month, and the five-year rate at 3.5 per cent, according to the central bank. The People's Bank of China has refrained from cutting the interest rate aggressively, stirring expectations that the economy has been riding out headwinds such as tariffs from the US and a downturn on the property market. Other major Asian markets were mixed. Japan's Nikkei 225 slipped 0.1 per cent and Australia's S&P/ASX 200 lost 0.7 per cent, while South Korea's Kospi rose 0.9 per cent. Advertisement
South China Morning Post
15 hours ago
- Business
- South China Morning Post
Ant Group pushes wider adoption of AI-enabled smart glasses for mobile payments
The first such payment outside mainland China was recently completed in Hong Kong using Meizu 's StarV smart glasses, according to a statement on Thursday by the company, an affiliate of Post owner Alibaba Group Holding That transaction was made via AlipayHK, the Hong Kong platform of Ant Group's flagship Alipay app, using Meizu's smart eyewear to scan the QR code and use voice command. The whole process – including voice interface, intent recognition and voice authentication – was powered by Ant's artificial intelligence (AI) system. The mobile payments functionality shows that proponents of AI glasses are expanding use cases to help broaden the adoption of smart eyewear. The Ant-Meizu initiative comes days after a similar launch on the mainland by augmented reality (AR) glasses maker Rokid with the Hangzhou -based fintech giant. The Rokid eyewear introduced on Tuesday supports in-store payments by scanning the QR code and confirming payment with a voice command. 'In the coming years, this technology could enable people to complete transactions simply by looking at or gesturing towards a product,' Ant said in an earlier statement on Tuesday.
Bloomberg
15 hours ago
- Business
- Bloomberg
JD.com Billionaire's Viral Stunt Reignites China's Food-Delivery Feud
One unusually warm evening in April, Richard Liu revved his scooter through Beijing's traffic-snarled streets alongside other delivery workers, and then personally handed food orders to surprised customers. Later that night, over spicy hotpot and ice-cold beer, the Inc. founder welcomed a pair of riders from two rival delivery firms to his company. The publicity stunt, broadcast on viral online videos, reignited a fight for China's $80 billion-plus food delivery market. In just a few months, JD, China's largest online retailer by revenue, amassed 25 million daily takeout orders across 350 cities, capturing more than half the volume of Alibaba Group Holding Ltd. 's the runner-up to market leader Meituan. Neither saw Liu coming.
