Black Friday – the name elevates images of people standing in long lines, fighting the crowds to grab the best bargains of the year, and filling the shopping carts to the rims. From another perspective Black Friday is the day when retailers try to push their sales to the last limits in order to maximize their profits, i.e. move from red (loss) column to the black (profit). While the shoppers try to grab the best bargains of the year, the retailers, on the other hand, try to achieve their Black Friday sales targets, this battle continues till the end of the day to mark the winners and losers of this battle. (Article continuesbelow)
Decoding the Numbers
Black Friday, referred to as the Super Bowl of the retail selling season witnesses hundreds and thousands of turkey-stuffed bargain hunters storming the big retail stores to mark the beginning of the official Christmas shopping season. Every year, the National Retail Federation releases the key statistics of this annual shopping bonanza, once the event is over. These data points, key stats, and insights reveal a lot of interesting information about the consumers and their shopping patterns. Key information such as how many people shopped on this annual sales event, how many were male shoppers, how many were female shoppers, what was the average amount spent by males shoppers, the average amount spent by female shoppers, and what was the total sales volume, these are some important insights that can help retailers make better marketing decisions during one of the biggest seasons inretail.
Here are some of the key stats and data points revealed by the National Retail Federation for the past few Black Fridayseasons.
|Black Friday Spending in the US|
|Year||Sales (millions of USD)|
|* Forecasted Sales for the Year 2016|
The data provided in the above table clearly indicates that total consumer spending on Black Friday has increased significantly over the past few years. In 2010 the total consumer spending on Black Friday was $51,020 million, whereas it touched an astounding figure of $70,492 million in 2015, which accounts for 38.1% increase. Based on the figures obtained from last year and looking at the future trends, the experts predict that these spending can easily touch $77,316 mark in the coming Black Friday season, an increase of almost 10% from the last year.
In the UK market, similar shopping trends were observed in the Black Friday event during the last couple of years. In 2014 bargain hunters spent about £1,300 million, whereas this figure reached a record £3,300 million on Black Friday 2015 – an increase of 153.8% from the last year. Looking at the stats of the past few years, the experts are forecasting £5,000 million of sales in the coming Black Friday 2016 event in the UK. These figures are a clear indication that more and more people in the UK are taking a great interest in this annual retail shopping bonanza which was only restricted to the US market a few years back.
Sales and The Economy
The forecasted sales of $77 Billion for the US market and £5,000 million for the UK market for the coming Black Friday 2016 means that the holiday season will be merry and bright for the retailers and consumers alike. There is no doubt about the fact that this annual sales bonanza is a make-or-break time for the many US and UK retailers, it also has a great impact on the US economy, since the consumer spending category makes up almost 70% of the US economy. With this much amount in hand millions of pets can be rescued from the shelters and can be raised for more than 10 years. This amount is more than the GDP or Luxembourg and the GDP of countries like Estonia, Jamaica, Albania, Zimbabwe and Luxembourg combined.
No doubt, financial experts, and economist consider Black Friday as a blessing for the troubling US economy.
What Exactly It Means
For an ordinary consumer, Black Friday is nothing more than a seminal shopping event where hundreds and thousands of bargain-hungry shoppers are drawn to literally thousands of departmental stores and malls across the country, looking for the best bargains of the year. However, the term Black Friday has a nothing to do with shopping and bargains in the historical perspective. According to some historians, this term it was first coined by some disgruntled Philadelphia traffic police officers to describe the heavy and disruptive vehicle and pedestrian traffic which would occur on the roads in anticipation of the big Navy-Army football game.
In late 1980’s, the term resurfaced again, this time not from the traffic police officers but from the retailers to describe a day that helped them increase their sales and record their profits for the year from red to black meaning from a loss to profit. Traditionally this day referred to the Christmas shopping season in the US, as it was the most profitable season for many US retailers.
In the UK, Black Friday referred to a day before Christmas when people would go crazy drinking alcohol. In 2013, ASDA, a Walmart subsidiary was the first retailer to introduce this massive one-day shopping bonanza to the bargain-hunters living in the UK and recorded a very good response. Over the past few years, more and more US as well as UK-based retailers have offered heavy discounts on thousands of products on the day after Thanksgiving and recorded huge profits. Although Black Friday is originally an American invention, but it has slowly but surely developed its roots in the UK market.
The Major Players
Traditionally Black Friday is a family event; however, among the family members, there are some who participate more actively in this shopping frenzy than the others. Black Friday 2015 witnessed more participation from the female members of the society aged 35-45 years; they accounted for 59% of the total Black Friday sales. Males aged 35-45 years contributed to the rest of the sales. Similarly, people used multiple means to do their Black Friday shopping in 2015; the number of people who used their tablets to do online shopping outsmarted desktop shoppers in terms of total spendings. There were also some hot products that captured more attention of the bargain hunters, these included Super Smash Bros for Wii U, Jordan shoes, Beats by Dre, and Apple iPhone and iPads.
The Changing Battlefield
Black Friday sales reached record levels in the last year, but if you are wondering why you did not see those long lines and scenes of shoppers fighting for the best bargains, it is because most of the Black Friday shopping last year was done online. Sales data from last year reveals that 51% Black Friday shoppers used their smartphones to shop online and only 49% headed to the shopping malls and big retail stores. Shoppers have all the good reasons to justify their choice of using their mobile phones and desktops to do their Black Friday shopping online.
A Look At Some Of The Winners
The online shopping landscape has dramatically changed the shopping behavior of Black Friday shoppers, as a result, many big retail giants with profound online presence and popularity are enjoying good sales and profits. Let us have a look at some of the major retailers who were able to make it to the victory stands last year.
Amazon came first with a big chunk of the online sales (35%) in the last Black Friday season. Apple with its popular iPad and iPod brands also enjoyed a good Black Friday season last year. Similarly, REI despite its early announcement to remain closed on the big day recorded 26% increase in the online traffic.
Every year Black Friday creates demand for thousands of new jobs. Retailers hire more than 70,000 part time seasonal workers and offer them handsome packages and bonuses to perform various tasks like managing distributions, dealing with customers, running store operations and stocking new inventories. These season workers are always the winners in this battle of sales and bargains.
A Look At Some Of The Losers
At the end of every epic Black Friday shop-a-thon, there are winners and there are losers. Let us have a look at some of the losers of Black Friday 2015.
The brick and mortar shopping trend, in general, experienced a great decline in last year’s Black Friday shopping event. ASDA, a Walmart subsidiary that introduced this event in the UK market failed to survive. Similarly, a lot of other big retail stores in the UK like Primark, John Lewis, Oasis, and Argos also reduced their participation or canceled it altogether. A lot of the online retail stores failed to handle the heavy traffic load and experienced downtime. John Lewis, for example, reported that one minute of downtown accounted for £75,000 in lost sales.
In addition to the lost sales faced by the retailers, the consumers also faced losses in terms of injuries and deaths while shopping for discounted items on this one-day shopping bonanza. Since 2006 almost 98 people faced various injuries and 7 lost their lives to win this battle of sales and bargains.
The Role Of Socia lMedia
Over the past few years, social media has played a major role in driving traffic to retailers’ websites and helped them increase their sales and meet their Black Friday targets. Let us have a look at some of the major social media platforms and the role they have played to supercharge this shopping extravaganza.
The term Black Friday was mentioned more than 620,000 times in various Twitter posts during the first ten days of October 2015, an increase of almost 21% from the last year. Best Buy also used this social media platform to its advantage and gained 164,000 mentions in 2015. Most trending products mentioned on Twitter during the Black Friday sale are Xbox, TVs, clothing, smart devices, and electronic gadgets.
Instagram is another social media platform used increasingly by retailers and consumers alike during or before the Black Friday event. In 2015, Victoria’s Secret gathered 239,666 likes while Starbucks managed to pull 205,252 likes.
Not The Only D-Day For Enjoying Huge Discounts And Sales
After enjoying huge sales volume in 2015, and capturing almost 35% of the total Black Friday sales, Amazon, the biggest e-commerce giant came up with the idea of celebrating a day of its own called the Prime Day. By spending $99 anyone can become a Prime member and take advantage of the Super Deals, which Amazon claims will make people forget about the Black Friday bargains altogether.
Besides the Prime Day, China’s Singles’ Day, world’s biggest online shopping extravaganza also poses a serious threat to the Black Friday. Alibaba, China’s e-commerce giant is at the forefront of this threat which is expected to generate $20 billion worth of sales in the coming year.
Some Tips For The Retailers
In order to counter the threats from the two e-commerce giants and to pull as many consumers to their website and brick and mortar stores, the retailers in the US and the UK need to do the following:
- Prepare your website and brick and mortar store for the shoppers
- Identify your most profitable social network
- Use the most powerful social media platforms to spread the word
- Start a dedicated hashtag for your business
- Make videos a key part of your social content
- Simplify the buying process
Some Tips For The Shoppers
While it is important for the retailers to have a solid plan in place before entering this promotional extravaganza, it is equally vital for the consumers to have a smart game plan in hand to enjoy huge bargains, which can include points like:
- Set a reasonable budget
- Avoid overspending
- Avoid impulsive buying
- Shop online
- Get social with your friends and your favorite retail stores
Over the past few years, Black Friday has become the most important day for many e-commerce businesses; therefore World Wide Web is going to be the major battlefield for this fight. Retailers need to keep in mind the changing shopping landscape and take advantage of the social media site to attract as many customers as possible. It is only with innovative marketing, out of the box thinking, stronger planning, and of course “better deals” that the retailers will be able to win the heart and minds of bargain-hungry shoppers. – See more at: