Issue of the week: what’s the point of Black Friday?
The annual discount extravaganza may be “all hype” – but it is still make-or-break for many retailers
“Exciting news,” said Carol Midgley in The Times: “we have a new acronym”. FOBO, which stands for “fear of a better option”, refers to people “who find it impossible to commit... in case a sexier opportunity arises”. It could have been tailor-made for shoppers fretting about the seasonal discount extravaganza known as Black Friday. “I can get £200 off here at Currys, but what if Amazon extends its sale and slashes further?” The bottom line is that Black Friday “bargains” are “a chamber pot of bollocks”. And now that’s official, said Patrick Collinson in The Guardian. According to “damning research” by Which?, just “one in 20” Black Friday deals is actually genuine. When the consumer group checked the prices of 83 items on sale on Black Friday last year, it found that “nearly all were cheaper or available for the same price at other times of the year”. The upshot, it concludes, is that the now fortnight-long event, which peaks this Friday, is “all hype”.
There are certainly “signs of fatigue” on the high street, said Collinson. Footfall experts at Springboard expect the number of shoppers to decline during this year’s event, although foreign tourists cashing in on the weak pound are expected to “keep the tills ringing”. Next month’s election has dampened “consumers’ appetite for spending”, though, according to Springboard, which is combined with growing “scepticism” about Black Friday itself. That hasn’t stopped UK chains from waging a “sales arms race” in what is traditionally a make-or-break time of year, said Tom Witherow in the Daily Mail. Retailers are expected to pull in £8.5bn, or £310 per household, between Black Friday and Cyber Monday on 2 December. “But experts warn that the move will backfire” if shoppers simply move their presentbuying earlier to take advantage of lower prices. “Black Friday hasn’t typically generated higher sales overall,” noted Thomas Pugh of Capital Economics. And if margins are squeezed, more retailers are at risk of going bust or closing stores.
Online shopping is still growing, said the FT. US bricks-andmortar retailers are braced for a chilly year-end under “intensifying pressure” from internet rivals. Online sales are expected to rise 18% from last year, according to IHS Markit, “far outpacing retailers such as big US department stores, where shoppers are expected to spend 6% less”. There are some bright spots globally for department stores – in Paris, for instance, upmarket “grands magasins”, such as Printemps and Galeries Lafayette, retain their appeal. But elsewhere the march of e-commerce continues – and Black Friday only accentuates it.