A very different Black Friday experience
Black Friday, the annual retail frenzy, arrives again this week giving us an opportunity to benefit from discount deals as we run up to the Christmas holiday period. But the experience this year will be very different from previous years for both retailers and shoppers, in part due to the COVID-19 pandemic as well as the significant impacts of the fast-changing retail environment.
Since the arrival of COVID-19 there has been a significant move to online shopping by consumers, either due to the closure of non-essential shops or because of the convenience and safety of home delivery. The move online had already started to seriously impact physical stores on the high street prior to COVID-19, but now, particularly due to lockdown effects, 2020 is predicted to be the toughest year for store closures and job losses since 2008/9 with 235,704 job losses and 20,620 store closures by the end of the year or about 56 store closures per day (Source: The Centre for Retail Research).
The move to online shopping plays well with the concept of Black Friday and our increased acceptance of the online shopping channel should mean another year of growth in Black Friday sales figures. However, as well as the impact on shopping channels, we also know that customer buying behaviour and consumption patterns have changed. The pandemic has tangibly impacted the economic position for some but also created caution among many others. Segmentation of consumer attitudes and behaviour is useful here (Source: EY Future Consumer Index). For those most deeply affected, spending can be expected to fall across all categories except groceries. For others, income may not have been directly affected by the pandemic, but consumption attitudes have. Key influences will be the degree of pessimism about the longer-term future; concerns about stockpiling; or overall availability of goods. These factors will create caution over spending or how Black Friday discounts are viewed.
Another influence on Black Friday sales will be the fact that for the first time, consumers in some parts of the UK will have to consider those enticing deals on offer without the benefit of being able to view and/or buy physically in-store. This will be particularly difficult for those shoppers who have not so far moved to 100% online shopping and prefer to be able to see and touch before purchase. To shoppers in this situation the purchase may feel quite scary, particularly when buying high involvement/high risk goods such as TVs, computers, electronic equipment, furniture, cars or white goods. Being able to use our senses, particularly vision and touch, is key to the process of how shoppers evaluate information about products and form decisions, so its absence may be difficult for some.*
So, consideration of Black Friday deals this year will take on two new dimensions: the economic and psychological influences created by the pandemic, but also the sense of trust to buy in a totally online environment. For many this year it truly will be a leap of faith when they buy.
*The Henley Centre for Customer Management is currently researching this situation of buying high involvement products 100% online. If you have bought a ‘big ticket’ item online during lockdown and would like to take part in our survey please go here.