Black Friday has become a household term in the ever-evolving retail landscape. Every year, after Thanksgiving, global brands compete with each other to make the most revenue from customers by discounting products in various categories. Customers are promised enormous discounts on items ranging from home appliances to clothing, on the most anticipated sales day of the year. Reduced prices of goods are advertised by brands to entice potential buyers into spending on what may seem like a good bargain. But are the unending queues, gnarling screams and ‘bumper-to-bumper’ shopping carts of Black Friday sales actually worth it?
87% of goods have already been sold for lower prices
In a saturated market with several big box retailers, consumers are sucked into the hype of Black Friday. Recent reports reveal that the discounts are not as cheap as they seem. A study conducted by Which.co.uk showed that 87% of goods sold for much lower prices during other times of the year. The products examined included technology, personal care items and home merchandise. 86% of the items were found to cost the same or less six months prior to Black Friday whereas 46% were reported to cost lower within six months post Black Friday.
Retailers take advantage of shoppers by ‘posing’ prices of products as low on the big shopping day. To avoid getting duped, buyers should monitor the prices of items carefully in weeks or months leading up to the discounted event so they can actually save money.
Busy individuals who are hard pressed with time and are unable to go into brick and mortar stores (or couch potatoes who cannot be bothered to leave their sofas), will still be able to access steals on Cyber Monday.
The Cyber Monday eclipse
In recent years, Cyber Monday sales have overtaken the main discounted event with online B2C retailers recording huge profits via sales. E-commerce retailer, Amazon won a huge portion of the market share this year. They announced they had broken records with an estimated 18 million toys, and 13 million fashion products purchased on Black Friday and Cyber Monday combined. Its CEO, Jeff Bezos smiled all the way to the bank becoming $6.28 billion richer.
The success of companies like Amazon has led to the ongoing cycle of failing high street brands. Over the course of 2018, there has been a dip in profits and announced closure of shops such as ToysRUs, Poundworld, Mothercare and M&S. One of the key strategies that gives the online giant a competitive edge is the ease of e-commerce. With the click of a button, shoppers have access to an array of products to choose from. The fast-paced nature of modern living has decreased shop footfall over time, and created a surge in websites which have succeeded in filling the gap.
At KHWS, we implemented by multiple brands across this year’s Black Friday. ‘Less Means More’ was used to create exclusivity in the form of limited time or supply. The consumer sometimes gets only 24 hours of big discounts, which creates a rush of urgency in sales. The fear of missing out on limited time deals is the main driving force for Black Friday revenue hikes, but as we also discovered, some brands were better equipped than others to take advantage of this.
Not everyone win’s big
According to the Guardian, high-end department store, John Lewis saw a 7.7% increase in sales in the week to November 27. Not all brands were equally as able to chalk up success. The Business Insider UK reports that chains such as Walmart and JCrew – due to the lack of preparation – experienced technical website crashes which led to millions in revenue loss, during Black Friday weekend. Others run out of stock early in the game, leaving customers to opt for their competitors.
This notwithstanding, Black Friday 2018 was a huge success. Data by Adobe Analytics reveal that online sales were a whopping $6.22 billion juxtaposed to $5.03 billion last year. These impressive figures go to show that there is hope at the end of the tunnel for brands lagging behind.
To win a share of the market, no matter how small, competing brands should identify the changing nature of buyer preferences to ensure that the insatiable needs of consumers are fulfilled same time next year.
Written by Afua Akoto04.01.19 Archive