Singles Day boosts China's ecommerce

China's e-commerce giants have geared up to cash in by offering online sales promotions on the Singles Day, which kicks off Monday, on Nov. 11.

The day, which was started in the 1990s by college students as an alternative to Valentine's Day, has been taken up by online retailers over the past five years, with the leading sites T-Mall and Taobao posting sales volumes of 19.1 billion yuan last year.

In 2013, T-Mall, a main store, is promoting 50 percent discounts and using social media to attract shoppers; its vice president Wang Yulei indicated that more than 20,000 online stores had joined the Single's Day campaign.

"The number of stores joining the Double 11 Day promotion has doubled," Wang told Xinhua.

Rival ecommerce platforms are also looking at ways to get a piece of the action. JD.com's Li Xi said: "During this year's event, we are carrying out small trials with some brands, including time-honored brands and department stores."

This was a reference to the showrooming trend. Department stores in Chongqing, SW China, have tackled this by attaching tmall.com logos to products, so customers can, for example, try on clothes in store before ordering online to enjoy the discounts.

Wan Donghui, deputy secretary-in-chief of the China E-commerce Industry Association said this is the future. "More and more companies in traditional industries and more retailing companies are forging commercial models of OTO , which means offline to online." he noted.

He saw franchise stores opening online stores, while online platforms were cooperating with offline stores. "I think the trend is, quite obviously, beneficial for everyone," he concluded.

A study by the McKinsey consultancy found that 60 percent of China's online consumption represents a switch from offline, while the remaining 40 percent is new demand that would otherwise be nonexistent without online stores.

The Internet has either unearthed or bred consumption that lay dormant or was hidden. All this spending is exactly what is required to propel the economy through consumption rather than through export and investment.

With an estimated 296 billion U.S. dollars in online retail sales, China will soon surpass the United States as the world's largest online retail market.