With Thanksgiving over, consumers and businesses now turn their attention to the start of the festive shopping period – beginning with Black Friday. But are people falling out of love with this shopping day?
Originally an American phenomenon, Black Friday is the semi-official start of the festive retail period. There’s no consensus as to why Black Friday is called Black Friday, although one compelling theory is that it represents the day where retailers start to earn a profit.
It’s easy to see why that might be the case. In America alone, approximately 249 million people will purchase something on Black Friday, with the total spend in 2015 estimated at $50.9 billion. Black Friday first appeared in the UK 2 years ago, and total spend this year in the UK is expected to exceed last year’s total of £1.5 billion.
Give it a Miss?
Despite the obvious draw of low priced goods at a time of year when many are budgeting for Christmas, some have begun to look upon Black Friday as a symbol of a highly consumerised society and something that adds stress in an already stressful part of the year.
From needing to be in line well before midnight to get the best deals, to the big name brands not being on sale at all, and the potential to get caught up in unsavoury scenes similar to those that played out in shops across the UK last year, there are compelling reasons for giving the shops a miss on Friday.
Alternatively people will look for other options, such as shopping online on Friday (where many retailers have the same, if not better deals), or choosing to wait until Cyber Monday to make their purchases.
It also appears that retailers are beginning to fall out of love with Black Friday too. Far from boosting profits, statistics have shown that many retailers actually lose money on Black Friday, with sales not being sufficient to outweigh the slim margins they have to cope with. It’s also believed that increased transactions are as a result of consumers waiting for these sales, rather than purchasing earlier in the year.
Even Asda, owned by Wal-Mart (attributed with introducing Black Friday to the UK), has decided that they will give the sale day a miss this year, citing customers’ “shopping fatigue” and electing to spread out their seasonal offers over a longer period of time.
Supply Chain Strain
Organisations that aim to maintain high customer service levels for online operations face having to hire additional employees and increase logistics capabilities to keep up with demand.
Organisations need to ensure that their supply chains are up to scratch, with consumers likely to go elsewhere if products are either out of stock or unable to be delivered in good time. And if supply chain issues have been present during the year, customers may not return to the retailer at all, in spite of the deals being offered.
Being able to cope with increased demand, and being flexible enough to react to changing trends, is key for organisational supply chains. This includes being able to assess demand in real-time and potentially move stock between locations in order to satisfy customer wants.
The End for Black Friday?
In spite of all this, it’s unlikely that Black Friday will cease to exist entirely. Retailers who have their strategies well planned and the ability to meet customer demand, will want to remain in a good position to take a share of the billions of dollars spent.
However, as more organisations extend their Black Friday sales, either by starting earlier in the week, or extending them over the holiday weekend and beyond Cyber Monday, it is possible that it might be the last we see of these sales in their current format.
Is your organisation having a Black Friday sale? Are you involved in ensuring the supply chain is able to meet demand? Get in touch and tell your story.