Black Friday is possibly one of the most significant marketing successes of the last decade. It found a way to tap into a bubbling pre-Christmas market and turn it up to boil. This year, however, retailers are facing new challenges to this winter windfall. They are also potentially facing their biggest opportunity yet, with IMRG’s research figures predicting up to a 45 per cent increase in sales for UK retailers between the 23rd and 30th of November.
“Black Friday continues to grow in popularity and is expected to be the most popular deal day in the United States, the United Kingdom, France, and Germany in 2020, with an average of 60% of holiday shoppers in these countries saying they plan to participate this year, up from 50% last year.” (Periscope by McKinsey, 2020)
Firstly, the Challenges:
Loyalty is the one thing that tends to go most quickly out of the window when it comes to flash sales like Black Friday. This is for one simple reason: price sensitivity. The race to the bottom at times like this means that people are looking out for bargains, not really thinking about brand or retailer loyalty. What’s more, with incomes impacted by the pandemic, this is likely to be exacerbated in 2020. Periscope’s recent Retail report found that 40 per cent of consumers have shopped with a new retailer this year and a third have tried a different, less expensive brand of a product. Furthermore, only 12 per cent of consumers are intending to shop with the same retailers as last year.
Simply put, around 45 per cent of shoppers in the UK care less about Black Friday this year than they did in previous years.
Ouch.
What’s more, a lot of people rushed out before lockdown to their high-street to get a head start on their Christmas shopping. This may mean people are already stocked up to avoid missing out on must-have items.
Now, the Opportunity:
It’s not all doom and gloom, though, we assure you. Whilst some of the research is a little bleak, there are some silver linings to these pandemic clouds.
1. Last-minute shoppers are buying earlier – those pesky Christmas Eve parents desperately seeking the latest top toy are likely to become a rarer breed. Lockdowns are incentivising people to get in early, with many likely to turn to Black Friday. Loyal customers who know what they want are trying to avoid late deliveries. Half of McKinsey’s respondents said they are likely to get a head start on shopping this year.
2. Online is on Fire – festive shoppers are leaning more on online retailers than ever, with 39 per cent of Periscope respondents intending to shop more online during holidays this year than they did last year.
The appetite to buy is there, it just might need some imagination from retailers. By creating tailored and relevant shopping ideas with personalisation can really influence buyer-behaviour. Nearly a quarter of respondents agree. So, it’s worth using the data you have to tap into latent loyalty.
Demand also has to be met, so it’s also worth offering extended ‘Black Friday’ deals over a longer period of time, perhaps even incentivising loyalty scheme members with previews or longer timeframes. Some gift card retailers are offering compelling money off deals, which means that the trickier people to buy for can also be sorted early.
Whatever you do, just remember that loyalty is earned. Don’t undo good work by offering unsustainable deals short term. Looking after the customers that keep coming back.
