A Brief History (and Bright Future) of Black Friday
Christmas is just around the corner – really. Chances are you’ve already had your first Christmas-tune earworm stuck in your head. Wreaths and decorations have probably started to crop up in your local pubs. While the slow trickle of the season may have already begun, the floodgates of the Christmas season really open up on the newest of British holiday traditions: Black Friday. Will you be ready?
So why all the fuss about Black Friday?
Until a few years ago, Black Friday had primarily been a US invention – referring to the day after Thanksgiving, when many Americans having had their fill of Thanksgiving turkey and extended family, would flock to their local shopping centres to get started with their Christmas shopping. Retailers, realizing this was a perfect opportunity to woo shoppers began promoting specials. As competition for Christmas shoppers increased, so did the scope and intensity of their promotions. A frenzied mob clamouring for that half-price flat-screen TVs in one of your stores? Well, that was a sign of a good deal… and a good year.
For many retailers, Black Friday became the most important day of their year, as it was a strong predictor of sales for their Christmas season. The time in which most retailers had their peak sales, accounting for roughly 20% of their annual revenue. So, that’s why it’s been sort of a big deal. In fact, it’s become a significantly bigger deal over the past decade, steadily growing year over year, and generating roughly twice the revenue in 2014 than it did in 2005.
As you might notice in this graph, the past two years has actually seen a decrease in Black Friday spending in the US. Is this a sign that the whole shopping splurge around Black Friday fad has passed? Quite the contrary – it has grown and evolved. In short, Black Friday has competition in the form of Cyber Monday (dedicated to online shopping) and Small Business Saturday (for promoting smaller retailers). And even beyond the themed shopping days, retailers have begun to become much more savvy in how and when they serve up offers to customers throughout the holiday season.
Black Friday’s Impact on UK Retailers
For many Brits, retailers and shoppers alike, there’s still a bit of head-scratching about Black Friday. Is this a passing fad, or is it here to stay? Since arriving in the UK, each year Black Friday revenue has seen double digit growth, breaking the £1B mark (£1.1B) in 2015. Analysts expect the Black Friday to surpass that mark this year.
From a consumer perspective, Brits seem to welcome the day. For those who bought something on Black Friday in 2014, the experience was overwhelmingly positive – with 96% saying they were either very or quite satisfied. So basically, retailers and consumers are all quite enthusiastic about Black Friday 2015. The bigger question, though, is are you ready for it?
Are you ready for Black Friday?
Again, although the Christmas season seems far off, it really is just around the corner. If you’re a retailer, you may feel as though you’re behind the curve if you haven’t already fully prepared by the end of September. By prepared, I mean are you able to answer all of the following questions. Have you anticipated what your peak demand will be? Which of your customers will be shopping online vs in the store? What’s your optimal campaign schedule for holiday offers for your customers? What’s the most important differentiator for shoppers when choosing a retailer? How will social media channels impact your sales or customer service?
If you’re still preparing, there’s good news. First, Microsoft UK and One Connected Community have partnered to bring you The Bedlam of Black Friday, a free new guide for Black Friday and the rest of the holiday season. It offers unique insights as well as predictions, preparations and what to expect so that you can make the most of this year’s bedlam.
Second, with cloud-based services from Microsoft, retailers can start to deliver amazing customer experiences and ramp up for peak demand with solutions such as Dynamics and Azure before the holiday rush is in full swing.
