For an event that wasn’t even created in the UK, it’s amazing to discover that more UK than US retailers take part in it, according to Wirecard and others. And all this despite the fact that both retailers and consumers seem to have developed a dislike for this opportunity to screw up Christmas.
Whilst no one seems to have actually come up with a figure, it is clear that returns spike around Black Friday as consumers buy more impulsively because the prices look like they have come down.
Not everyone of course, as the national newspapers have reported; Black Friday deals are often as low as they are at other times of year, or worse, consumers often get a better deal by waiting until January, or even Cyber Monday. However, these are the same newspapers running editorials advising readers on where to get the best bargains, so everyone is playing the Black Friday game.
Some retailers won’t play and simply say that they are offering good prices all year round. Few retailers of course are mad keen on Black Friday. Why give away margin before Christmas and miss the chance of full-price or shallower discounts nearer December 24th. And worse, why put a pressured supply chain under even more pressure having to handle all those returns that come back from November 23 onwards?
Some retailers have adjusted well to Black Friday by knowing what margin they are going to get by buying stock in advance and reserving it. Others have protected margins by giving with one hand but taking away with the other; removing free delivery for instance.
Black days ahead
Consumer groups hate Black Friday because they claim it encourages people to buy things they can’t afford, but I’ve never seen any figures to support this, as distinct from any other time of year.
None of which seems to have created any sort of backlash. Black Friday does seem, in terms of the number of retailers who play, to be here to stay. However, consider this; with discounting now business as usual throughout the year, the Black Friday spike may even out over time, enabling both parties to plan better.
Consumers can take a view as to whether their Black Friday purchase is time-critical, knowing that the price is probably not the major motivating factor. And retailers can get on and plan their whole year better, allowing for some Black Friday action that doesn’t blow too big a hole in their margins.