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L'Oreal, Nestle score big at Alibaba's Singles' Day shopping fest

Published 11/12/2019, 03:26 AM
L'Oreal, Nestle score big at Alibaba's Singles' Day shopping fest
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By Brenda Goh and Josh Horwitz

SHANGHAI/HANGZHOU, China (Reuters) - Chinese shoppers snapped up food supplements, facial masks and baby milk powder at the world's largest shopping festival, with brands such as L'Oreal (PA:OREP) and Nestle (N:NESN) among the biggest winners, Alibaba (N:BABA) data showed.

The Chinese e-commerce giant's annual Singles' Day shopping blitz on Monday brought in a record 268.4 billion yuan ($38.38 billion) in sales, more than six times the amount of online sales made in the United States on Black Friday last year.

It kicked off this year's 24-hour shopping bonanza with a live performance by U.S. pop star Taylor Swift followed by the live-streamed marketing of over 1,000 brands.

Alibaba said on Tuesday that 299 brands surpassed 100 million yuan in gross merchandise value, including LVMH's (PA:LVMH) Givenchy, home appliance manufacturers Dyson and Philips (AS:PHG) and sportswear maker Under Armour (N:UAA).

Fifteen brands made over 1 billion yuan in sales, it said. These included Huawei Technologies, Apple (O:AAPL), Nike (N:NKE), Xiaomi Corp (HK:1810) and Fast Retailing's (T:9983) Uniqlo.

Food supplements were the most popular import product, while sales of makeup, diapers and face wash were also strong.

Sales growth for the annual shopping festival this year eased to 26%, the weakest since the event started in 2009, in a reflection of how e-commerce sales in China have been slowing.

Analysts, however, said the growth rate had slightly beaten their expectations, saying that more aggressive promotions, a focus on attracting more customers from rural cities, and even the overall slowing economy might have helped as people sought to buy goods at discounted prices.

Citic Securities had predicted a 20-25% expansion, while Daiwa Capital Markets had an estimate of 23%.

"What's happened is that you've had a lot of consumers this year being a little bit more careful about their purchasing because the economy's slowing down," said Ben Cavender, managing director of consultancy China Market Research Group.

"I think this year especially, people were kind of waiting for Singles' Day and kind of waiting to make some of those medium-sized purchases that they didn't want to pay full price for."

The event has been replicated at home and abroad, with Singles' Day promotions found at rivals such as China's JD.com (O:JD) and Pinduoduo (O:PDD) as well as South Korea's 11thStreet and Singapore's Qoo10.

JD.com, which started its sales campaign on Nov. 1, said transaction volume exceeded 204.4 billion yuan over the eleven days.

Uniqlo owner Fast Retailing said the online event also boosted visits to its physical stores, of which it has 700 across China, adding that its Heattech thermal underwear and Ultra Light Down jackets were among its most popular items.

(GRAPHIC: A look at Alibaba's Singles' Day shopping event - https://graphics.reuters.com/SINGLES-DAY-ALIBABA/0100B30E24T/index.html)

(GRAPHIC: Alibaba's Singles' Day sales - https://graphics.reuters.com/SINGLES-DAY-ALIBABA/0100B30E25B/SINGLES-DAY.jpg)

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