For many retailers, Black Friday has developed into one of the most important events in the consumer sales calendar and has become particularly significant for online retailers. So, what’s the background to Black Friday?
Where and when did Black Friday originate?
The term, ‘Black Friday’” gained national popularity in the United States during the early 1980s. Retailers traditionally operated at a financial loss for most of the year (January to November) and made their profit during the peak Christmas season, beginning on the day after Thanksgiving. When this was recorded in the financial records, common accounting practices would use red ink to show negative amounts and black ink to show positive amounts. Black Friday, under this theory, is the beginning of the period when retailers would no longer be ‘in the red’, instead taking in most of the year’s profits.
During the following decades, global retailers adopted the term and the date to promote their Christmas sales. In the 21st century, ‘Black Friday’ became part of the seasonal marketing mantra for many online retailers, spearheaded by Amazon.
Black Friday in the UK
As with many things American, they usually find their way over the pond to Britain and Black Friday is now part of our culture and calendars. But how did it arrive in the UK?
Previously, ‘Black Friday’ referred to the day when UK emergency services activated their contingency plans to cope with the increase in workload due to many people going out drinking on the last Friday before Christmas.
Amazon introduced the US-style Black Friday concept to the UK in 2010, offering a range of discounts and price deals to consumers. However, the UK wasn’t ready to fully embrace this phenomenon and ‘save the date’ – at least not for another three years. In 2013, Walmart-owned Asda introduced the concept and gave it a big push, and it was then that Black Friday started to fly in the UK. Shortly after, retailers saw the potential and embraced the practice, and this continues to grow in size and scope, with Cyber Monday and Cyber Week as consequential derivatives.
What are the impacts for 2021 Black Friday and the peak buying season?
Covid-19 has changed the way the world works, but the effect on the retail sector has been interesting. The anticipation and hunger for Black Friday has dwindled over the last couple of years but retailers have enjoyed a steadier flow of shopping traffic. This was driven by people spending more time at home, having more disposable income as travel costs associated with work decreased, and generally people needed a ‘tonic’ to get them through the pandemic.
However, another current concern for consumers is the impact of supply chain issues that could affect deliveries of everything from food to gifts. Many multi-channel retailers have already reported a shortage of products to put on the shelves or online. The knock-on effect has led to rising prices overall, but the toy industry, which relies heavily on Christmas sales, has felt the price-hike keenly, with prices increase by over 10% across all toy categories.
Consumers are buying earlier for Christmas
Recent surveys suggest that consumers are planning to buy early to secure the goods they want, either because of empty shelves or potentially further Covid-19 lockdown measures. Although high street stores are fully open and shoppers are once again enjoying the social aspect of bricks and mortar shopping, there is a sign that shoppers are hitting the high street now or doing their online shopping earlier than usual.
There are also signs that shoppers are spreading the risk of not getting Christmas goods, using a combination of early high street shopping and online purchasing.
Black Friday 2021 may not hit the highs of previous years if many shoppers are buying early to avoid disappointment. However, retailers need to keep a foot on the gas ensuring that they are delivering the best possible experience to their customers.
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