here’s only one curtain-raiser louder and more persistent than a kid’s countdown to Christmas: Londonshops screaming into your inbox about Black Friday.
The annual claim that you’ll never again spot a particular scented candle, extremely large TV or nasal hair trimmer at this price — colloquially known as Black Friday — takes place on 26 November.
But amid the supply crisis, and mixed results from retailers slashing prices to boost pre-Christmas sales, analysts are warning the Black Friday trend could be on the wane.
The tradition was embedded here by Amazon only relatively recently, then rapidly replicated by British retail chains from John Lewis to Curry’s.
“Black Friday came to the UK from the States like a tornado and it has taken some time for it to be understood,” says Clive Black, retail analyst at Shore Capital. “For some it is an opportunity to have a well timed boost to sales, perhaps clear some stock or gain some profile and market share.
“For others it is a nightmare that brings forward what were traditionally higher margin, full price sales at a discount — and also pressurises the supply chain, leading to downside all round.”
Bhavik Master, boss of British knitwear brand Paul James, agrees. His business is rejecting Black Friday this year.
“We do not believe in heavy discounting tactics,” he explains. “We believe in pricing our knitwear fairly from the outset, so our customers can shop when they actually need to purchase an item — [Black Friday] contributes to the boom and bust that many brands experience as it isn’t a sustainable business model.”
Of the major retailers, M&S and Next are among those who’ve bowed out of Black Friday sales this year.
The British Independent Retailers Association said 85% of its members would be boycotting the discounting day this year, the highest level its ever recorded.
Shoppers’ interest may be waning too: last year, the number of British shoppers buying Black Friday deals fell 6% on 2019, according to analysis by GlobalData.
Patrick O’Brien, GlobalData’s UK retail research director, predicts that supply chain problems will see more shops decide not to take part this year.
“We think that Black Friday this year will not be as big as it was pre-pandemic,” he says. “The stock issues which many retailers are experiencing mean they have less excess stock to shift, and prices generally are rising.
“However, it is still an important event for retailers, and as long as the big guns take it seriously with large discounts, then smaller retailers have little option but to get involved.
“The problem is of course that retailers collectively would be better off ignoring Black Friday completely, as it erodes profit margins at a time when people are prepared to spend, but the competitive impulses of the larger players make this an impossible scenario.”
Nicola Parker, director of online dental products shop Withasmile, admits she feels “pressurised” to join in with Black Friday, even though it hits the bottom line.
“As a small business, we’ve found Black Friday to be contradictory,” she says. “We believe that the customers who have purchased during [the sale] would have purchased anyway at full cost. On average, the week before Black Friday, our sales drop by around 50% as customers wait for the saving.
“But if we didn’t offer a black Friday sale, we may miss out on business to other companies who are offering one. It becomes a bidding war of who can offer the cheapest product.”
It’s not just about what’s going through the till, though. Some SMEs see Black Friday as a vital tool for securing customers’ data and loyalty.
“Black Friday is an important time of year for customer acquisition,” says Oliver Mennell, founder and chief executive of luxury candle retailer Neom, which saw sales more than double on the discount day last year compared to 2019.
“For us, it’s all about introducing new customers to our brand, and encouraging them to continue shopping with us in the weeks leading up to Christmas and beyond.”
That can come at a hefty price. Carolina Paradas-Mandato, head of strategic partnerships at loyalty app Swapi, says: “Black Friday is an extremely expensive marketing tactic, regardless of the huge amount of traffic and customer intent. Retailers can find themselves sacrificing profit margins and seeing a loss instead.
“It’s a volume game for most, so for SMEs, it’s a risky time to jump on the bandwagon. Plus it’s difficult to participate in these campaigns only once. Customers become accustomed to discounting.”
As we head into mid-November, the average online shopper’s inbox will still be screaming ‘Black Friday’ more repetitively than a self-check out with an unexpected item in the bagging area. But as SMEs and big chains alike tot up its impact, the phenomenon could be on its way out.
“Calling the end of Black Friday may be a bit premature but we have been through its peak — and most households, businesses and the environment are better off for it,” asserts Black. “Many shoppers have sussed out that, more often than not, Black Friday was a manipulation that sold them stuff, often tat, that they did not want and so did not represent good value.
“For SMEs, Black Friday can be a help to their financial performance but only if it is aligned with the real interests of the shopper and the business alike. In recent years it has increasingly served neither well.”