The extent to which Black Friday has been embraced by UK retailers varies as can be seen in the marketing leading up to the 27th November. Some are all out for it, others barely register a whisper, but in terms of pre-battle preparation some appear more ready than others.
Ebay will be launching new deals every day for the week. This spreading of online spending makes sense, keep the customer coming back. The more the customer engages with the retailer the more opportunity there is for the retailer to upsell a higher margin product.
Argos has been running Red Friday, Blue Friday, White Friday ahead of Black Friday, and Amazon have launched the event already, smoothing the sales across a longer timeframe giving space to each promotion and taking advantage of early awareness of offers. It will be a hugely competitive day for electricals retailers in particular with hot ticket games consoles, TVs, tablets and laptops only differentiated by price, depth of discount and availability.
AO.com has also taken the stretched version of Black Friday to its heart, launching ahead of the event with big price messages on big ticket items, new products being launched across the week ahead of Friday and then continuing afterwards too.
The big scale retailers have planned for the event, cultivated relationships with suppliers to buy at a price that is protective of margin, but there is also operations planning to be considered. IT and logistics management are critical.
Argos website has crashed twice in the last month which does not bode well especially as they are spreading the load. It would be shameful to suggest that Argos did not plan adequately for this event but with all indications pointing towards an even busier Black Friday event than last year, Argos must be working tirelessly to build contingency into its servers.
On the plus side, Argos have bricks and mortar stores to direct customers to for order collection relieving burdens on couriers. Retailers that push click and collect this weekend also create a second bite of the cherry with secondary footfall.
Head in the sand
The question whether Asda have made the right decision to back away from Black Friday is open for debate and won’t be resolved until Christmas trading is reported in January, but we would suggest that a retailer that doesn’t move with the customer, that just says it is too hard, will not do well in the long term. Rather than persuading the customer to come with them, they should be going where the customer is headed. Work with it rather than against it.
Made.com and Oddbins have made a parody adverts thanking the USA for some of its exports but rejecting Black Friday saying their prices are the best they can be all day every day. They have taken the opportunity to position themselves as EDLP retailers, but while tipping a hat to Black Friday and using the marketing hype to their own end.
For fashion retailers that have suffered in poor Autumn Winter sales due to warm weather, Black Friday presents an opportunity to clear some stock ahead of Christmas at potentially higher margin than might have otherwise been achieved.
That is not to say it is purely opportunistic for the fashion retailers, Harvey Nichols is using the event to encourage downloading of its loyalty app for deeper discounts, a clever twist to boost post event engagement with customers while clearing older stock.
Elsewhere online fashion retailers such as Marks and Spencer, Asos and Very are creating dedicated pages just for Black Friday. While that helps the customer find what they are looking for the opportunity for add on sales at full margin is lost.
We will be watching to see what happens over the coming weekend but we will be looking out for these top 3 things that we believe retailers should be doing:
- Volume behind the key offers but supported by add-ons that support the margin and mechanics to encourage return visits later in the Christmas season
- Align Black Friday activity with brand values to remain true to the target customer and maintain customer service throughout
- Contingency plans at store operations level and infrastructure are robust to deliver against the marketing messages.
If you see any cracking examples of retail excellence or indeed failures this weekend please tweet us, we’d love to know.