Black Friday could fade as football and inflation hit online sales | Retail business
The words Black Friday used to conjure up images of frantic shoppers rushing to shops and online stores to grab as many bargains as possible. This year it’s likely to be a more low-key affair, with non-essential spending set to drop due to cost-of-living pressures and distractions from the Men’s FIFA World Cup.
Britons are expected to spend £22.62 billion during the two-week Black Friday period, which runs from November 22 to December 5. That’s a 2.1% year-over-year increase, but once inflation is taken into account, it actually means they’ll put fewer items in their shopping carts, according to research by GlobalData for Vouchercodes. This is a marked slowdown for the American-inspired discount day, which has gradually transformed into an online event. There have been few queues outside stores in the UK since early exuberance led to scuffles in some stores in 2014.
A dank Black Friday firecracker could put pressure on retailers, who may have been hoping the event could generate excitement and spur shoppers to look for ways to cut back on Christmas party spending. Poor sales will only add to the annual chicken game where shoppers wait in hopes of getting better deals as Christmas approaches as retailers increasingly seek to eliminate inventory.
The buzz around the event will also be hit with football fever. On Black Friday night itself, rather than going shopping, large numbers of people will be tuning in to England’s second game, against the United States, dealing a major blow to the valuable sales of the evening.
However, some people may return to retail over the next few days, and the trend away from late-night outlets, seen by many supermarkets and hospitality businesses, could mean that bored households have more time to search for good deals. online business.
However, the growing skepticism of the bargains on offer probably means that the days of crazy clicks may be over. Consumer group Which? continues to warn that “most advertised ‘offers’ should be taken with a grain of salt”.
Technology, traditionally a winner on Black Friday, will also be less sought after this year as many families bought bigger TVs, laptops and game consoles for entertainment and work while stuck at home. during pandemic shutdowns.
A return to physical shopping after two years of high street closures could also put a damper on the mostly online event. Many retailers launched their Black Friday discounts early, suggesting they have inventory to clear after disappointing initial sales.
A period of relatively warm fall weather only added to the pain for clothing retailers. Winter coats and expensive knitwear, which traditionally drive fashion sales at this time of year, are proving less appealing in the kind of balmy temperatures that large parts of the UK have experienced over the past few months. last two months. Online retailers expect Black Friday sales to fall for the second straight year – by 5% according to trade body IMRG and analysts at Capgemini, with clothing suffering the biggest declines.
Worries over deliveries, with card strikes by Royal Mail lasting until Christmas Eve, may persuade many that a trip to town is a safer bet. Many of those with less to spend are also turning to cash rather than cards to keep their budget in check, making high street shops a more attractive option.
The decline is likely to put additional pressure on digital businesses already struggling with falling demand and rising costs, particularly for managing deliveries and returns as fuel, energy and and labor are skyrocketing.
“It is well documented that things are very difficult at the moment. If the situation deteriorates further, it will really be a cause for concern,” says Andy Mulcahy, director of strategy and insight at IMRG.
With a number of businesses already on the brink, fears of a bad end to the year – while the majority of retailers make their profits – could lead already nervous lenders and suppliers to pay off their debts, throwing a sailing on the sector for the so-called holiday season.