Surviving Black Friday

The Deal with Black Friday

Black Friday will fall on November 24th this year. Cyber Monday is the following Monday and is typically an online only event. But what started off in the US as one weekend of sale shopping following Thanksgiving, has evolved into an international frenzy of discounting and flash sales that can start to creep in as early as October.

Numbers for last year spending are still unofficial, but it was predicted that Irish shoppers would spend in the region of €26M online over Black Friday. That would equate to spending €18,000 every minute during this 24 hour period. Women typically spend more (66%) than men. The busiest times on the Friday are between 10am – 11am, and the second busiest hour is straight after from 11am -12pm. This 4 day event has transformed traditional December sales, inciting people to begin Christmas shopping earlier, with bargains on key product categories such as electronic devices, popular electrical appliances, (remember the air fryer frenzy last year?), jewellery and clothes.

The Discount

The driving force behind Black Friday is the discount. In 2022 the EU’s Price Indication Directive tightened up the rules relating to sales advertising. An advertised price reduction needs to also include the prior price of the item. And that product must have been available for sale at this prior price for 30 days. This is fairly new legislation and penalties will apply to any retailer who fails to comply.

This will hopefully tighten up transparency around any discount strategy. Consumers can sometimes be mistrustful of Black Friday discounting – believing that they lack transparency and are not genuine. That deep discounts offered are not real but relate to negotiation of a good price on a volume of product which allows a retailer to apply a discount strategy, while still allowing them to make decent margin. Consumers might think that the slash and burn is all smoke and mirrors and the retailer could actually be making more margin on his Black Friday assortment than his “New In” from September or “Must Haves” from October.

Key Deals & What To Look Out For

So what generally are key areas to look out for?

If you are intending to shop Black Friday, make a list of what you are looking for and stick to this. If you go online on Friday 24th without any prior planning, you could be swept up in a frenzy of sale banners, countdown timers, and claims that there is only one item left.

Historically, the best deals are on the likes of electronics (think tablets, phones) but also electrical and hardware items. Followed by clothing and jewellery.

As a consumer, you should shop around before you buy. Your wish list of items should be cross checked with certain retailers so you can ensure you are getting the best deal. It’s also important to consider and understand the shipping and returns policy associated with your purchase and how this affects the overall cost of your deal. If shipping costs are extra, or the shipping time is longer than 3 days, this may not end up being the deal of the century when compared to other offers.

As a retailer, when building your Black Friday offers, you need to be aware of how omnichannel has influenced shopper behaviour and most consumers will do their homework and shop around before they decide to progress from the add to cart stage to proceeding to payment.

What About The Smaller Guys & Gals?

How can the smaller outfits stay competitive with the big guns? Black Friday is not going anywhere and is largely controlled & orchestrated by larger retailers. Any small or medium retailer cannot afford to ignore Black Friday so would be well advised to come up with some sort of strategy that will enable them to stand out for the right reasons.

There are a number of different mechanisms small, medium and independent retailers can utilise in order to stay relevant and top of mind during this time.

Create limited time offers: apply a time based offer and encourage customers to act fast or lose out on the opportunity altogether.

Offer membership /loyalty benefits: do you have an existing loyalty scheme whereby you reward customers for shopping with you, e.g. offering a number of points for every euro spent that can be offset against future purchases? If you do, remind your customers of this when you are communicating your sale offers. This can be perceived as an additional saving or reward and could swing a customer’s mind when purchasing online.

Make sure your shipping times are competitive compared to others in the market.

Ensure you have the right balance of newness and surefire items to attract the customer.

Can you offer personalisation? And truly give the customer something that is exclusive and is not available elsewhere?

Talk up your customer experience and high level of service. For bricks and mortar especially, nothing beats the IRL experience of having a face to face retail experience, so make sure that this is the best it can be (authentic & real) with knowledgeable and personal sales people. At the end of the day customers like to feel appreciated and you have a real opportunity of ensuring that this is the case in store versus online.

Make returns easy, consider widening the return window.

Offer true value – do you have an own brand / private label that you can highlight? Own label provides you with something that is not directly comparable and you may have some more wiggle room with this in the discount level offered.

Create a value offer via gift vouchers. Example buy a €100 gift voucher and we’ll make it out for €110.

Be yourself & tell your story. Storytelling is always important in retail and you should always be doing this. It’s an easy way for you to keep communication lines open with your customers and provide them with interesting content about why they should shop with you and what you do or what you offer that is so different and unique to anyone else, (and especially as opposed to someone else who could be a multiple retailer or a huge online retail giant). You might be small, but remind your customer of that very fact, how many people you employ, the level of service they can get from you as opposed to an AI generated one elsewhere. Most people like to support local and independents. With so much money spent on Black Friday we should be encouraging customers to ensure that as much of this stays in the country as possible.

Focusing on these mechanisms will also help to improve overall retention, because really at the end of the day for any business to survive, it’s not just about Black Friday but garnering that customer’s loyalty so that they keep coming back to you again and again.

Can Black Friday Ever Be Green?

You can remind people to keep it local and be sustainable. By shopping local, this obviously supports that business and the local economy. When you decide to spend with your local electrical store over an online giant, remember you are also supporting employment & enterprise in your town.

Shop with independents – I can tell you from my own experience as a small business owner, that when you hear that bell notification on your phone that someone has bought something from your little online store, you do a little dance. To you as a customer, a €50 transaction might not seem so steep. But to the small business owner, it might be the reason to get up and do a little dance around their kitchen table.

Champion Green is a national initiative which encourages people to support local enterprise. They share an example where every €1 spent with local businesses gives an injection of at least €2.50 into your local community and the national economy which leads to “sustainable employment but even more importantly vibrant and energetic communities and creative and cultural industries right across our island”.

Conclusion

I remember a time in 1990s Ireland when the biggest sale of the year was never November, but always December, and end December at that. As teenagers, we would be delighted to take any money we had earned or been gifted and head into Tralee on December 26th, to queue around the corner (for ages) to Derry’s Shoes on Russell St. where we were delighted to part with our hard cash for some boots that were on a Christmas special.

The retail trade in Ireland had a total of 23,709 active enterprises in 2020. These enterprises generated almost €38.8 billion in turnover and accounted for almost 225,000 persons engaged. This sector also employs a high proportion of women. So many reasons to support your local economy, wherever that might be.

I would hate for our towns to become so homogenous that you could drive through one and then another without anything standing out to mark each one different, unique, independent & special.

Support your local area in any spending you plan on doing all year, not just Black Friday.

I’ll leave you with a story behind one of Tralee’s oldest shops, Benners. Three generations selling really useful things.

Video credit: Feenish