Fragile Consumers Feel the Heat as Top Chinese Livestreamer Cools Off
China’s consumption outlook can be easily observed by examining the largest livestreamer in the country.
Li Jiaqi, known as the “lipstick king” for his ability to sell cosmetics, recorded sales of 9.5 billion yuan ($1.3 billion) on Oct. 24, the first day of the annual Singles’ Day shopping festival, which ended on Saturday. A report by the Southern Metropolis Daily, which did not say where it got the information. That’s down from 21.5 billion yuan on the first day last year, it said.
Separately, Caixin said sales of Li’s beauty products fell 38% on the first day of the festival. According to a Securities Daily report, his share of total sales during the consumer bonanza shrank to about a quarter this year from a third last year.
The underperformance of one of China’s top salesmen shows how challenging it is to get consumers to open their wallets. Deflationary pressures, already struggling with economic turmoil from the real estate market crisis to high youth unemployment, are fueling concerns about the growth trajectory of the world’s second-largest economy.
Built around the Nov. 11 event, popularized by Alibaba Group Holding Ltd more than a decade ago, the annual bidding competition, which has traditionally been used as a barometer of Chinese consumer sentiment, has become much harder to interpret after companies stopped providing accurate sales figures. During the Covid era.
The two key e-commerce platforms run by Alibaba and JD.com Inc likely managed a 1-3 percent increase in gross merchandise value in the three to four weeks before Nov. 11, when merchants began their discounting spree. , Goldman Sachs Group Inc. estimates.
Alibaba’s Taobao and Tmall businesses announced that it recorded positive year-on-year growth in terms of gross merchandise value, order volumes and participating merchants compared to last year.
In addition to the deteriorating macro environment, Li’s sales may have been hurt by recent impropriety. In September, he came under fire on social media after telling a woman who complained about the price of an eyebrow pencil on one of his live streams that she wasn’t working hard enough.
Former top performers beloved by retail brands are losing their appeal following a series of scandals, including tax evasion. That’s how global retail giants like Nike Inc. and L’Oreal SA, as well as local brands like Anta Sports Products Ltd., are investing in their own company-run streaming pages on platforms like Taobao.
