Black Friday business participation gains momentum but enterprises fear that increase in sales mainly a shift in consumer consumption

A survey conducted by GRTU following last week’s Black Friday initiatives sought to analyse the effects of this relatively new phenomenon in Malta, following what appeared to be the best year in terms of private sector participation and initiatives yet.

The survey indicates a significant increase in enterprises that have this year participated in Black Friday with 35% of respondents saying that it was their first time participating. Business continuity is also a key factor with enterprises saying that they have now participated for more than one year and were even able to compare this year’s success over last year’s. In fact, while 46% said that they would say that their sales for this year’s Black Friday were practically on the same lines of last year’s, 45% said that they did better and 9% classified it as much better.

The initiative appears to have expanded in participation both in terms of the sectors involved and in terms of diversification of localities. Participants in the initiative are mainly found within the typical sectors that one would associate with it – clothing, shoes and wearing apparel as well as wellness and beauty and within the natural shopping locations in Malta of Sliema, Valletta, Paola and also Gozo.

A variety of other sectors have however also participated in some way or another this year and these included, among others, household products, car rentals and sales, supermarkets, opticians, the tourism sector, sporting and hobbies, as well as the more industrious finishings sector.

The localities from which businesses participated practically covered all of Malta. The offers mainly involved across the shop discounts or discounts on specific categories of products. With regards to marketing, those having outlets said that they all made sure their shop window grabbed the consumers’ attention. The use of social media advertisement through Facebook was very strong and the absolute majority said that they felt this effort was effective.

Even though Black Friday was actually just 24 November, 40% of respondents said that they extended their initiative to cover all the weekend until Sunday. Very few extended further, either by starting earlier or by including what is known as Cyber Monday.

When asked to compare sales during Black Friday as opposed to a normal shopping day, 50% signal an increase of 30%, 17% said an increase by 20% and 7% said an increase by 10%. The same figures featured for the 20% who said that they extended their offers to their online shops.

The rest of the respondents say that they did not experience an increase in sales even though they participated in Black Friday and some even said they experienced lower sales. GRTU attributes the reasons behind this to the fact that such respondents were either from the non-typical sectors that the consumer would associate with Black Friday or their outlets were found outside the localities that hold the best shopping strongholds.

Respondents that did not participate in Black Friday said they stayed out mainly because they do not feel the initiative is relevant to their industry or they were not expecting such a participation and therefore did not prepare for it.

Others said that they prefer including regular offers in their stores and/or they do not believe in the initiative as it ruins other shopping days 24% of these say that they might consider participating next year and 8% say they will certainly do so.

With regards to the effect on consumption, the opinion is split. Those that feel that Black Friday results mainly in a shift in consumption and the days preceding it and following it are extremely slow are more in number and some indicate also to a negative effect on Christmas shopping.

The other respondents feel that while there might be a displacement in the spending pattern, they also feel that the consumer ends up spending more overall, even when calculating sales covering the whole festive season. The argument given to sustain this is that while it is true for many consumers today to wait for Black Friday to buy their necessities, some are also encouraged by the offers and find it more difficult to resist a bargain and end up buying also things they had not originally planned for.

Apart from the increase in sales some point out to the negative effects experienced in this year’s Black Friday. Traffic congestion seems to be the main issue here with customers reporting extensive delays in reaching their desired destinations with a traffic gridlock that lasted hours.

Businesses also reported difficulty in catering for the surge with sufficient staff complement considering the human resources constraints enterprises are experiencing across the board.