Black Friday outpaces traditional December sales
Australian shoppers’ love of a good discount dominated in the lead-up to the festive season last year, as the popularity of Black Friday sales in November increased and the demand for Christmas shopping took a downturn in December.
According to the Kepler Retail Index, December sales were 2.7 per cent down compared to 2017. By contrast, the Black Friday weekend outperformed 2017 by almost 14 per cent and daily sales levels were similar to the levels during 27-29 December, negatively impacting the three week trading period immediately afterwards.
Christmas retail demand arrived late and the three days prior to the Christmas showed an increase of 3.5 per cent on the same three days in 2017. Unfortunately, Boxing Day sales were down 10.3 per cent compared to last year and during the post-Boxing Day period, despite an increase in traffic, the expected uplift in sales wasn’t quite as pronounced as last year.
According to other data, retailers did not have sufficient staff or stock levels last year. It’s possible that retailers tightened up wages and supply chain costs as they were concerned about lower December sales and margin pressures.
Outside traffic in December were reported as 1.8 per cent below 2017 levels, which continued until 22 December after the highs associated with the Black Friday weekend.
According to Kepler, a key driver of pre-Christmas sales in an environment of lower traffic numbers was consumers’ intent to buy and retailers’ focus on optimising inside traffic opportunities and converting them into sales.
Ignore Black Friday at your peril
Black Friday may have emerged from the US, but thanks to to the global nature of online, the sales event has since become an international phenomenon. The sales event takes place on Thanksgiving, the fourth Thursday in November, marking the start of the Christmas shopping season in the US.
Now, major Australian retailers also take part in Black Friday, from Myer and David Jones to ASOS, The Iconic and eBay.
According to Kepler, retailers who were not prepared for Black Friday or failed to take part in the sales event missed out on the upturn in sales and were also affected by the subdued trade in the period thereafter.
Instead, retailers should consider getting involved in Black Friday next year and plan for effective store promotions and effective visual merchandising to attract customers. It’s clear that consumers are now more savvy than ever, opting to do their Christmas shopping during the sales period, rather than making last-minute purchases in December.
“The period post-Black Friday will result in lower foot traffic – budget accordingly and consider other sales strategies,” suggests Kepler.
“Maintain a central focus on sales conversion and upselling training for store level staff. This will optimise traffic opportunities and subsequently reduce the pain of lower traffic numbers through increased conversion.”