The shopper perspective
We expect shopper participation in Black Friday will be higher than ever this year. In 2016 33% of shoppers bought something on Black Friday itself. It’s interesting to see that younger shoppers are considerably more likely to get involved on Black Friday – 63% of those aged 18-25 bought something last year. For those aged under 25, this event has been in existence for pretty much all of their adult lives – for them Black Friday is well established and an expectation. 29% of shoppers told us that they plan to spend more on black Friday this year
It’s also important to remember that Black Friday is not only about Christmas presents – there is a lot of self gifting and general purchases that take place. 30% of shoppers who bought something on Black Friday last year, did not buy any Christmas presents during the event – and this rises to 55% among over 55s.
The retailer perspective
As we approach Christmas we find the consumer economy in a resilient but fragile state. While unemployment remains low, real wages are falling, consumer confidence is shaky, concerns about further interest rate rises sit at the front of shoppers’ minds and uncertainty surrounding Brexit has potential to knock retail spending. As such retailers feel nervous about Christmas and many will find the temptation to shift stock through Black Friday discounting irresistible. This uncertain landscape makes it likely that many retailers will extend Black Friday well beyond a single day event, to last a week or even longer. The risk is that Black Friday becomes no more than a label for broader margin eroding pre-Christmas discounting.
Following the trend of recent years, the emphasis of Black Friday has moved further online this year. Online events are easier to plan and manage, and retailers will be keen to avoid any in-store disruption and security issues caused by crowds. Also online Black Friday events have the potential to be targeted more specifically, rewarding loyal customers with personalised discounts and promotions.
Electricals is set to be a big Black Friday category this year. Amazon is pushing its new range of Echo and Fire products, while Curry’s started offering some deals in the run up to the event. Some fashion retailers are using the event to shift excess stock after reporting poor October trading. More retailers have specifically bought stock for Black Friday events, allowing them to create some excitement around the event while protecting their gross margin.