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Cover Story Series> Business
UPDATED: December 3, 2012 NO. 49 DECEMBER 6, 2012
Online Carnival
China's online sales hit a record high on November 11, offering new hope in efforts to spur domestic consumption
By Zhou Xiaoyan

HURRY UP: Parcels pile up at a station of a delivery company in east China's Jiangsu Province, after the massive promotion on Singles Day, which falls on November 11 each year (CFP)

ON THE WAY: Wang Yonggang, a delivery man, eats a steamed bun on November 9, before leaving for his next destination (XINHUA)

"E-commerce is one of few bright spots in China's economy now," Alibaba Group CSO Zeng Ming said at a media briefing on the sidelines of the company's annual Alifest customer convention in Hangzhou.

Alibaba Group's main shopping websites will see sales triple to 3 trillion yuan ($481.8 billion) over the next five to seven years, as the country's online retail market continues to expand despite slower growth overall in the Chinese economy, said Zeng.

"People shopped online only occasionally in the past, but now online shopping is a lifestyle embraced by many," said Zhang Yong, President of Tmall.

Wang Lizhe, a teacher at Renmin University of China (RUC), just purchased an apartment in Beijing and plans to decorate it through purchases made online.

"Shopping online has become a habit of mine. Buying stuff for our home online will save me tons of money and take less time and energy," he said.

"When I want to buy something, I usually go to the store to see the product first hand before heading online to find it at a more reasonable price. It's how I do things," said Wang Lizhe.

This dramatic lifestyle shift from offline to online shopping has been a boon for online retailers.

Total e-commerce sales revenue in 2011 stood at $55.37 billion, up 103.7 percent year on year. The year-on-year growth rate in 2012 is estimated to be 94.1 percent, said eMarketer, a market research firm.

In the third quarter of 2012, the total transaction value of China's e-commerce market amounted to 1.99 trillion yuan ($319.8 billion), up 21.9 percent year on year, and up 6 percent compared with the second quarter, according to a report from the Shanghai-based iResearch Consulting Group, which specializes in China's Internet industry.

In 2011, the total number of online shoppers in China stood at 187 million, representing an increase of 39 million from the previous year, according to an iResearch report.

Direct employment in China's e-commerce had topped 1.90 million people as of June 2012, and the number is expected to reach 2.65 million by the end of this year, the report said.

A new way for growth

China has been trying to stimulate domestic consumption to boost growth and shift away from a substantial dependence on exports at a time when the global economy remains uncertain. The country's economy grew at a rate of 7.4 percent in the third quarter, its lowest quarterly rate in more than three years. Amid dwindling foreign demand and shrinking foreign direct investment, domestic consumption is increasingly seen as a way to facilitate growth.

Online retail sales accounted for 4.32 percent of total sales in China last year, up from 1.16 percent in 2008, according to the Ministry of Commerce.

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