International retailers rethink Black Friday strategy
The growth of major sales events such as Black Friday, Cyber Monday, and Amazon Prime Day is changing the shape of peak season, according to a new survey from marketing firm Yieldify.
In a survey of more than 400 US and UK retail marketers, Yieldify found that retailers are anticipating Black Friday revenue this year to be 25 per cent higher than 2018, and revenue from the wider holiday season to be 28 per cent up on last year.
Taking a closer look, however, it is clear that attitudes towards the discount-driven event are evolving. Twenty-two per cent of pureplay online businesses surveyed said they are opting out of Black Friday altogether, and those that are participating will offer smaller discounts than their omnichannel peers.
In addition, rather than offering heavy discounts over the Black Friday period, many retailers are looking to spread discounting across the holiday quarter, with price cuts peaking in the weeks leading up to Christmas.
Eighty-five per cent of retailers surveyed said they will offer discounts in the weeks leading up to the Christmas period, and more than half (57.6 per cent) will offer discounts across their entire range during the Christmas period – higher than on Black Friday (50.6 per cent) or Cyber Monday (44.4 per cent).
US retailers are more likely to favour this approach to discounting, even on Black Friday, with 61.9 per cent discounting across all ranges versus just 39.3 per cent of their British counterparts.
“[This] attests to the trends we’ve been seeing in recent years with our clients – what used to be a race to the bottom for discounts has evolved into a more diverse set of approaches to the traditional peak season,” Yieldify chief executive and founder Jay Radia said.
“With competition stronger than ever, it pays to be different as much as it pays to discount.”
Shippit joint chief executive and co-founder Rob Hango-Zada recently told Internet Retailing that online discounting was beginning to have a negative effect on the industry as a whole.
“The discounting in online retail is reaching a point of unsustainability, as it’s not triggering offline shoppers to buy online, but online shoppers to pull forward their spend,” Hango-Zada said.
However, not participating in a broader sales event can be dangerous for retailers with underdeveloped offerings, as it becomes easy to be pushed out of the customers mind – if only for a few days.
“Only those with compelling everyday low pricing and free or flat shipping rates tend to benefit from not partaking in a promotional event,” Hango-Zada said.
This story originally appeared on Inside Retail.