RIP BLACK FRI-DAY?
There’s no doubt that COVID-19 caused widespread economic disruption, but retail demand doesn’t appear to be slowing down. In the US, the barometer of retail health, holiday sales for 2020 are anticipated to increase by 3.6% to 5.2% compared to last year, according to a National Retail Federation estimate. So, the holiday shopping season isn’t going away - but Black Friday as the five-decade-old discount shopping day is on the verge of becoming obsolete as shopping discounts are increasingly spread out over weeks, even months (Oct and Nov), punctured with multiple sales events. In fact, fewer American holiday shoppers bought gifts during the five-day period from Black Friday to Cyber Monday, and those who did spent less, as discounts started early this year, according to the National Retail Federation. It appears, as the New York Times notes, Black Friday is “less a single shopping day and more a mentality.”
ONLINE FOR THE LONG HAUL
Looking to the future, it’s clear that consumers will still want savings on holiday purchases, and it’s likely that they’ll continue to want them without long lines and crowds. This year’s Cyber Monday, (following Black Friday) marked an all-time record for one-day spending online in the U.S., according to Adobe Analytics, with sales up 15.1% from a year earlier. E-commerce sales globally have skyrocketed this year with the role of the brick and mortar store likely to be forever changed, morphing into either fulfillment centers or experiential places for entertainment instead of for traditional shopping.
ECOMMERCE: DELIVERY VS CLICK & COLLECT
Over Covid-19 people have gotten used to collecting ecommerce items through shop windows, on pavements. According to Adobe Analytics, US click-and-collect orders (kerbside and in-store pick-up) surged 208% between 1 April and 20 April, compared to a year ago. ‘Click and collect’ is going from a matter of safety and necessity to a game-changing useful retail service - a convenient way of interacting that avoids third-party delivery processes. Plus you’re avoiding crowds and queues! From a retailer perspective it’s a win-win - much cheaper than delivery and uses existing staff and resources - so it may become the new normal for retail.
THE NEW RETAIL LOGISTICS - CUSTOMER SERVICE, POSTAGE & PACKAGING
With the increase in online shopping, comes the increase in packaging and delivery/ postal services. Ireland’s National Postal Service, An Post, is anticipating 3.3 million packages a week for the next two weeks (post Black Friday) - up from 2.5 million last year. Parcel delivery is up 230% year on year. That’s a lot more packages in circulation requiring more postal/ courier employees, warehouse employees and cloud computing experts (Amazon has added 427,300 employees in 10 months, bringing its global workforce to more than 1.2 million) as well as more packaging - on average, seven times in fact. Gulp.
Retailers, national recycling companies, shipping companies and delivery companies are all faced with enormous logistical challenges in terms of dealing with higher package volumes, with many suggesting additional fees will be placed on basket-loads to cover additional delivery and recycling costs.
The demand for enhanced customer service is also at an all time high, with shoppers demanding instant responses to their queries, and engaging in additional research online. For retailers, ability to deliver personalised responses (on social and on websites) in addition to having extensive Q&A sections will be put under increased pressure.
BLACK FRIDAY ALTERNATIVES: BRANDS GET RESPONSIBLE ON CONSUMERISM
And while demand for retail is currently high, largely influenced through pent-up demand from lockdowns and restrictions, the counter-trend of anti-consumerism is also growing. Over the last few years, the anti-Black Friday conversation has grown rapidly in the context of responsible consumerism. Patagonia’s ‘Don’t Buy This Jacket’ print ad, actually first appeared in 2011. Below the jacket’s image were details as to why customers shouldn’t buy the product - 36 gallons of water required to produce the jacket (enough to fill the daily needs of 45 people), the 20 pounds of carbon dioxide emitted (24 times the weight of the jacket), and the amount of waste produced (two-thirds of its weight in waste)...
This year, along with a host of other retailers activating anti-Black Friday campaigns, Patagonia shone in marketing headlines for another responsibility move. The brand encourages another mental shift around consumption with a 'Buy Less, Demand More' message (and another captivating climate-focused print ad), promoting a circular economy initiative which heralds the next phase in the company's evolution - including integrating its four-year-old Worn Wear program for used clothing and gear.
MAKING MONEY MATTER
Green Friday and Giving Tuesday are other reactions to Black Friday worth noting. Green Friday aims to turn Black Friday ‘Green’ (and more sustainable) by getting shoppers to invest in local communities and businesses. The number of online shoppers during ‘Small Business Saturday’ rose 17% to about 68 million people.
“A growing number of Americans have expressed a desire to support local shops and Black entrepreneurs during a year when the pandemic has hurt small businesses and the George Floyd protests have highlighted Black Americans’ unequal access to opportunity. That’s also fueled spending on Etsy, a website that features unique, handmade and personalized gifts made by small businesses.” CNBC
Giving Tuesday (the Tuesday after Thanksgiving in the US) aims to spark a global generosity movement by getting people to support the causes that matter to them. Brands have also got on board with Giving Tuesday by making pledges to donate to charities and encouraging positive community impact through conscious spending.
BRAND TAKEOUTS
The verticals of retail have dismantled. Consumers expect to access brands in multiple ways, demanding quick answers to queries , seamless customer journeys and value offerings that exist beyond any one day/event. While e-commerce infrastructure investment increased in 2020 in line with the move to shop online, the increased need for customer service and a considered delivery system need to be must-haves for those set to win in retail in 2021.
P.S. As we still grapple with the huge amount of packaging associated with home deliveries think about how you gift any packages… Wrapping pressies in newspaper might be the most environmentally conscious way to pass things on.
