For retailers, the Christmas period has always been make or break. But Black Friday is now pulling Christmas sales forward to late November.
This year’s Black Friday sale is widely expected to be the biggest shopping day of the year for 2020, with blockbuster deals expected across all categories. Imported from America, Black Friday is the day following Thanksgiving and was traditionally a major shopping day for families celebrating the long weekend. But it has now been cleverly appropriated by retailers as a shopping event in its own right, with this year’s sales expected to exceed even Boxing Day.
Holiday retail sales this year will be heightened by COVID-19 restrictions which have effectively halted overseas travel and placed major limitations on the hospitality sector. In a boon for retailers, consumers are set to spend their holiday dollars locally. And unlike the UK and USA where the pandemic has dramatically restricted in-store shopping, Australian retailers can seize on expected rises in customer traffic. Major shopping centres are already recommending customers shop early in the day to avoid customer limits and queues.
David Jones chief executive Scott Fyfe said today that the department store chain is already seeing strong momentum in homewares and gifting and expects “an extremely busy period both in store and online.” For Melbourne retailers which were closed for all of September and October, this event is a fantastic opportunity to shift excess stock which had built up throughout this period.
Whilst many customers will participate in Black Friday shopping through online channels, we should also expect continued growth in click-and-collect activity. McKinsey have also noted a trend of “loyalty shifting” whereby many people have tried new online brands and retailers during the pandemic-fuelled year of online sales growth. These retailers now have the opportunity to lock in these customers through offering great deals and experiences online through events like Black Friday.
The levelling out of holiday spending across four weeks leading into Christmas has the added benefit for retailers of flattening the demand spikes which often accompany major sales events. By spreading the holiday shopping demand across the four weeks of December, retailers are now better able to manage store and home deliveries and reduce the risk of disappointing customers with late deliveries.
Despite some form of income reduction for many during 2020, most people are planning to spend up on holiday shopping deals. After COVID-19, we are all looking for something to celebrate. Many of us will be up early and racing to Chermside, Chadstone or Chatswood for some real, in-person shopping. But some nervousness about the virus lingers, so consumers will likely shop for larger baskets, and seek to make fewer stops than in previous years.
