The Christmas period is the most important time for retailers, as consumers start building up their piles of Christmas gifts for friends and family. Once a period encompassing the present-buying period of December, through to the January sales, the Black Friday shopping weekend bonanza has made its way across the Atlantic and significantly elongated the festive season for British retailers too. Renowned for its heavy discounts, one-time deals and frenzied shoppers, Black Friday kick-starts shopping and the sales period far earlier, so retailers need to be on top of their game for considerably longer.
Unsurprisingly, consumers have welcomed this new tradition with open arms as it gives them an opportunity to seize great discounts just when they’re doing their heaviest shopping; before the Christmas period. However, for retailers, it is having a fundamental impact on the traditional retail patterns they’ve come to know well.
Before the Black Friday phenomenon, retailers had a steady build up to the spike in demand around Christmas – one they knew was coming and could prepare for, way in advance. This enabled them to ensure enough stock was available and further logistics support was in place. But those patterns are changing as consumers take to the shops far earlier, expecting discounts in the months before Christmas, not just after. It means traditional algorithms of consumer behaviours are outdated, with new timelines leaving retailers unsure of what to expect.
Since making its way across the pond, the effects of Black Friday have been up for debate.
First off, one positive is undoubtedly the impact it has on brand awareness just before the Christmas period. The fact that this year saw more than £1bn spent in one day alone demonstrates increased demand and attention from consumers. If you got your brand strategy right, it could make a huge difference to your performance over the Christmas period, which you should now seek to capitalise on
That said, Black Friday can also be seen to have a negative impact. Stock availability, maintaining excellent service at peak times, a further weakening of low profit margins, and dealing with a high volume of returns after impulse purchases can severely impede a retailer in the crucial build up towards the Christmas period. This can result in a negative perception of the retailer throughout the holiday season.
While this retail craze has caused a headache for retailers, there are solutions out there to help businesses prepare and reap the benefits of Christmas shopping sprees – and one of these methods is predictive analytics. Here are just some of the ways it can help:
Like it or loathe it, Black Friday will be kick-starting the Christmas shopping period from now on, and retailers would be a foolish not to acknowledge its impact on traditional Christmas retail patterns. A retailer’s biggest asset during the festive period is the data it has collected throughout the years. By using this data effectively, retailers will be in a much better place to tackle Christmas.