Black Friday is quite possibly the most drama-filled time of the year, in-store that is. There was the woman who used her pants as a shopping trolley, and the individual who called the police over a sold-out TV #sorrywhat? It’s a bit like a weird movie in an intoxicating chaotic, repeat visit kind of way.
Mike Smollan, Chief Growth and Innovation Officer, Smollan checks out the Black Friday phenomenon and how to play the game.
Globally, according to www.queue-it.com Black Friday online sales grew 3.5% to $65.3 billion last year. Retail sales increased by 12% and was recorded as the biggest shopping day of the year in the US, with online retail traffic three times that of a normal October day. That said, 60% of consumers said they bought a sale item, only to regret it later, with 23% of women saying that they suspect retailers inflated prices ahead of Black Friday, only to “discount them” on the day.
Furthermore, marketing tactics not only drew traffic in 2022, but also revenue with 29% of online sales attributable to a paid search; 19% to direct web visits; 17% to organic searches; 15% to email and 3% to social media.
Closer to home, looking back to look ahead, from a banking perspective FNB reported that its customers spent a record R3 billion on Black Friday last year, with most shoppers popping into physical stores to grab deals. R2.4 billion was spent in-store an increase of 18% on the previous year, while over R670 million was spent online, a rise of 31%. This year amidst rising interest rates and inflationary demands South African consumers will no doubt be cautious as Black Friday goes live. That said, the adrenalin rush and instant gratification that it brings is all too real with the promise of a moment to “let loose”.
Determining the best fit for the promotional period to leverage both in-store and online strategies, will depend on the specific business and target audience, to ultimately hit the sweet spot with consumers. Both in-store and online options have their advantages. In-store offers the excitement of sensory appeal for shoppers, an opportunity to engage with customers, drawing them in with eye-catching displays and product demos and maxing on impulse buying. While online offers the potential for new customer acquisitions, reaching a wider audience, as well as being able to tap into detailed analytics to track shopping behaviours and identifying trends going forward. A hybrid approach makes sense for example, offering online deals that complement in-store promotions, and using online channels to drive foot traffic to physical stores.
“Undoubtedly the customer connection is everything whether online or in-store as consumers demand an excellent shopping experience over Black Friday. They want options, the latest ranges, offers on offers, quick check-outs, quality, delivery in the quickest time possible if ordering online, and a store experience where availability, and lots of it, does not switch their mood. What we’ve found from an in-store perspective during these times of high demand, is the immense value of sending in our surge merchandising teams. Where they focus solely on brand visibility, additional POS and making sure product is in stock, on shelf, all the time. That’s the whole idea right, speed, efficiency, and targeted sales,” said Mike Smollan, Chief Growth Officer at Smollan.
Tapping into all available data from previous Black Friday sales to see what worked and what didn’t is key. This data will also stand companies in good stead for their festive strategies.
- Checkout Choice
Having a buy now, pay later (BNPL) payment option will allow cash-strapped consumers who are hoping to make big-ticket purchases the opportunity to pay them off. In fact, it makes sense to have as many payment options as possible. Also, options like an in-store pickup could score points with customers.
- Red Flags
Logistics will continue to be a challenge and brands must factor in delays. The key is to keep customers informed and manage their expectations. If you can’t deliver, keep them in the loop or if a product sells out, make sure you update this on your website asap.
- Don’t Underestimate Customers
South Africans love a good deal. They have also become masters at gamifying loyalty programmes allowing them to get the most out of Black Friday shopping. Don’t pull the wool over shoppers’ eyes, chances are one will get caught out.