Are there any benefits from Black Friday in the UK?
This week both ASDA and Argos have said that they are focusing on offers over the Christmas season instead of on Black Friday. Should all UK retailers start to question the value of Black Friday?
In the UK, no retailer can forget the scenes of last Black Friday where shoppers were physically fighting to get their hands on the best deal products. In one sense it is great that retailers could shift a large amount of products and that the larger retailers were getting great marketing from the news channels reporting on what happened in store; which was driving more customers to the stores. Clever retailers were still making a healthy margin by putting their current sales items into the Black Friday sales without increasing the discount. Every retailer that I have spoken to enjoyed a huge success with revenue increases as a result of their Black Friday event. So why have ASDA and Argos announced that they won’t be participating this year?
Both ASDA and Argos have a strong retail store presence as well as having a strong online offering. To handle big promotion days like Black Friday every store will have to provide a large amount of staff working to handle all the additional customers. Plus they will need additional staff like security to manage the large volume of crowds. Unfortunately this is required to keep both customers and staff happy; because retailers never want to lose customers due to a bad experience, or have staff call in sick because of additional stress from these sales days. You may think that retailers with stores could opt for an online only Black Friday, but the likes of ASDA and Argos offer a full Omni-Channel service which means customers are more likely to get upset if the offers are online only. And customers may not even realize that the offer is online only and still head to the store only to be disappointed.
So what should UK retailers do? My view is that if you are an online only retailer then you should be doing a Black Friday sale. If you can make the deals attractive enough without losing too much margin then it should be a winner. If you don’t do a Black Friday sale you will most likely lose some customers to your competitors who are doing Black Friday sales. But if you are a retailer who has a retail store presence then you should work out the risks of what will happen in your stores and consider the cost of extra staff to support the sale. Ask yourself if you will still make a profit?
As an alternative to both eCommerce and in-store sales for Black Friday, you could look at running the sales on your social media channels. This is like a Private Sale, but only for your customers who follow you on social media, like Facebook or Twitter. This will give you greater control over the deals that you offer and place them outside your usual sales channels. Plus you may drive more people to follow you on your social channels. This type of selling is ideal for Black Friday as it offers stock that is limited in quantity and provides it at a special offer price for a limited time, something that should be attractive to potential customers.
So is Black Friday good for the UK? Whilst there are shoppers wanting to get a deal and retailers wanting to have a sale, Black Friday is here to stay in the UK. Black Friday is good for boosting the November revenue numbers for retailers as long as it does not impact the peak trading numbers. But we will only really be able to judge if Black Friday is good for the UK over the next couple of years.