Black Friday 2022 is going to be different to previous years, but just how differently it plays out is yet to become clear. Retailers have been launching earlier sales periods, there have been some challenging fiscal events, and the World Cup is being played in Winter, in Qatar!
So, what is going on with the earlier and earlier sales?
As ever, the retail giant Amazon is a leader in the field (in 2021 they accounted for 17.7% of Black Friday sales) – this year they launched additional Prime Day sales in October, setting the scene for early Black Friday sales. This is the second time Amazon has run Prime Day in October. In 2020, they said it was because of the pandemic, but it could be more evidence that consumers pause spending in October in anticipation of November sales. This is an indication that the ‘day’ of Black Friday in the UK is progressively becoming less significant, with sales and discounts coming earlier year on year, lasting for weeks, if not months. Many companies are even releasing their Black Friday ‘final’ prices and discounts ahead of time at the start of November.
Amazon also continues to be a strong competitor for the rest of the eCommerce market – their portion of the Black Friday market is predicted to grow even more than in previous years, and they were the cheapest retailer during last year’s festive period for the 5th consecutive year. As they scoop up more market share, Amazon could damage competitors’ trading windows, with companies struggling to keep up with the level and frequency of discounts they can offer.
How are consumers behaving in the 2022 economic climate?
Challenging fiscal events have led to shallower pockets, and consumers are naturally concerned about their budgets. With pressure building on households, they’re generally looking to cut back on unnecessary spending – indeed, almost 60% of shoppers expect to cut back on non-food spending in the so-called “golden quarter”. All is not lost however, as retailers should be looking to advertise promotions while consumers are looking for opportunities to purchase items at a discounted rate. 85% of shoppers will be using the event to get early Christmas shopping done, so starting to introduce Christmas messaging during the period could be a smart move
This will be the first financial crisis to affect the Gen-Z population, and they may well be quick to tighten their belts. A recent study found that 51% of those earning under £25,000 will be avoiding the sales, and so targeting the right customers will be pivotal to marketing success. Retailers should be looking at their first party data and seeing how they can use it to direct their efforts to those most likely to spend. Another useful tactic is to offer added reassurance to customers. Offers such as extending free return windows, free delivery, and increasing Buy Now Pay Later terms can all contribute to customers’ peace of mind.
But how useful is Buy Now Pay Later for retailers?
Buy Now Pay Later (BNPL) can be a life-line, and an attractive method of purchasing for many shoppers looking to spread the cost. The market presents a massive opportunity for growth in the coming years, as online purchases become more common – in fact, 61% of Gen Z have claimed to use a BNPL service. BNPL has now even reached fast food. In October 2022, Deliveroo and Klarna announced a new partnership that will see Deliveroo customers have Klarna as a payment option at checkout, enabling them to “eat now, pay later”. Customers can delay payment for 30-days or pay in 3, splitting the purchase into 3 equal payments. Is this more evidence that BNPL is the future, becoming an expected offering at checkout, or is it a step too far?
Black Friday 2021 saw a 105% increase in BNPL usage compared to 2020, and the BNPL market is expected to have risen globally by 78% in 2022. This is big news for retailers this Black Friday, as given the cost of living crisis, with energy bills soaring, discretionary spend is limited this year and consumers will be shopping early to spread spending over a longer period, with little (or zero) interest holding them back from doing so.
And finally, could football really impact eCommerce retailers?
For the first time in almost 100 years of the competition, the FIFA World Cup 2022 will be held in Winter, in Qatar, kicking off on November 20 and running until December 18, only 1-week before Christmas. It’s going to offer consumers a lot of joy that shouldn’t be forgotten about, and a chance for friends and families to gather and enjoy their nation compete in the country’s most popular sporting event. The lack of sun may mean fewer pub gardens and more living room viewings, but ultimately the timing and location for this year’s event is a first for us all.
Importantly, there are games scheduled to be played on Black Friday and Cyber Monday. This could have an effect on sales and promotions, with fluctuations in media spend and increased competition for search terms. Marketers will need meticulous planning, down to specific game times, for a smart and dynamic approach. But, will attention be taken away from any promotions, or will there be an increase in multi-screen usage that can be capitalised on? Of those who do tune in, 32% will be checking social media and 20% playing online games, so it could be a prime time for retailers to think outside the box and target the mid-match scrolling.