Costco will expand more heavily into China after it sold $3.5 million worth of goods over a 24-hour period with the help of Alibaba.
In October, the Seattle-area retail giant announced it was partnering with Alibaba to enter the China market for the first time. In doing so, Costco planned to sell some of its merchandise, including some of the Kirkland brand products, to consumers visiting the Tmall e-commerce platform.
As part of an Alibaba announcement today regarding Tmall Global’s performance, Costco said it sold $3.5 million worth of merchandise on Singles Day, which is China’s equivalent Cyber Monday.
“Our performance on Singles Day shocked and surprised our management and it totally transformed our annual business plan,” according to a statement issued by the company. “In 2015 we hope to offer Chinese consumers a richer variety of products through the platform and also improve their overall shopping experience.
Previously, Costco had said it sold over three tons of nuts and one ton of dried cranberries to Chinese consumers just a few days after going live on the site. Costco sells on Tmall Global, which doesn’t require brands to have a local warehouse or Chinese business license unlike the original Tmall site.
Singles Day, which occurs on Nov. 11, received unprecedented attention this year following Alibaba’s blockbuster IPO in the U.S., which raised $25 billion. Tmall did not disclose exact figures, but said that the site’s total gross merchandise volume in November was up 1,000 percent compared to its first full month of operations nine months earlier.
Earlier this month, Costco said its first-quarter sales for 2015, which includes most of November, increased 7 percent to $26.3 billion, with 1 percent coming from international. It did not break out its performance in China. It also operates in several other international markets, including Puerto Rico, Canada, Mexico, the United Kingdom, Japan, Korea and Taiwan.
Going forward, Costco will have increasing competition on Tmall. Today, the number of overseas brands featured on the website totals some 5,400, but that’s increasing. Alibaba said five of the top 10 European supermarket chains and more than 100 global merchants are lined up to join the platform.