Black Friday retail learnings - mobile matters and offline stores still appeal

Black Friday retail learnings – mobile matters and offline stores still appeal

By Stuart Lauchlan November 28, 2016
SUMMARY:

Black Friday came and went and the stats are coming in. What’s clear is that in the US, offline stores still matter to shoppers, while m-commerce has proven to be good investment for savvy retail firms.

The most startling revelation of the Black Friday hype that I came across was the existence of a website to track the death and injury toll resulting from rampaging bargain-hunters.

There’s clearly room for this. Security officers were forced to step in after a number of people got caught up in a brawl at the Vintage Faire Mall in Modesto, California, on Thanksgiving evening, while a stack of towels was apparently a sufficiently enticing bargain to have shoppers literally clambering over one another in a Walmart store in Georgia. Then there was the Nike store in Seattle that was trashed as 20,000 customers ripped it apart in search of cheap sneakers.

More seriously, Black Friday-related incidents have claimed two lives – one outside a Macy’s store in New Jersey and one in a Walmart car park in Reno, Nevada. None of which is to say that such things only happen in the US – a UK police officer received a knife injury in Leeds over an alleged shoplifting incident.

What the videos of shoppers running amok on YouTube and Twitter did highlight for me was the stark contrast between US and non-US approaches to Black Friday.

In the US, the local mall was still a destination of choice; in the UK, it was completely the opposite. I went to my local shopping center on Friday afternoon, expecting it to be hideously busy, but in fact it was quieter than the normal weekend.

The same story was reported all over the UK. Figures from retail research firm Springboard suggest that footfall on Friday fell by 7% on the high street and 5% at shopping centers compared to 2015. At the same time, UK online purchases were up 6.7% year-on-year, but that’s well down from last year’s comparable 31% rise. For all its hype, Black Friday remains at best an ‘evolving’ retail concept outside of the US.

Now, of course, in large part the comparative lack of action offline in the UK can be attributed to the fact that shoppers are, in the main, at work on Black Friday. In the US it’s a public holiday and a family occasion.

But what it does also indicate is that that while US retailer after retailer has spent much of 2016 pointing to a drop-off in mall traffic, there’s clear value to be had for not losing the real estate element of an omni-channel strategy. In other words, there’s still money to be made out of the stores.

That’s particularly interesting when retailers such as Wal-Mart, Kohl’s and Target made a point this year of offering the same deals online that they did in stores. So there was not real driver to get out of the house and down to the mall – other than that by Friday consumers are probably at the point of desperately needing to escape their families for some retail therapy!

Meanwhile Thanksgiving and Black Friday online sales tracked by Adobe Digital Index were $5.27billion, up 18% year-on-year. And those retailers which have prioritised investment in m-commerce and apps have spent their money wisely, with mobile purchases up 33% on Black Friday itself to $1.2 billion.

In come the stats

The 2016 stats will of course be pored over by retailers and analysts and doubtless there will be conflicting messages coming across. As the world’s largest retail trade association, The National Retail Federation (NRF) findings inevitably carry a lot of clout however and make for interesting reading.

NRF1

The NRF reports:

  • Average spending per person over Thanksgiving weekend totalled $289.19, down slightly from $299.60 last year. With an average of $214.13 specifically going toward gifts or 74% of total purchases.
  • The split between online and offline wasn’t huge – 44% of shoppers went online and 40% shopped in-store.
  • Of those that shopped in store, 75% shopped on Black Friday, up 3.4% year-on-year, adding weight to my theory that it’s a ‘get out of the house’ movement!
  • Of those that shopped in store, 51% shopped at department stores, 34% at discount stores, 32% at electronics stores, 28% at clothing or accessories stores, and 25% at grocery/supermarket stores.
  • There wasn’t much evidence of desperate consumers lining up before stores opened to snap up bargains either. Less than 15% of those Black Friday shoppers getting to the mall before the doors were unlocked.
  • A theme that’s been recurrent in recent weeks from retailers is a race to be the first to open on Thanksgiving afternoon and evening. That may have been something of a wasted effort as early Thanksgiving Day in-store shopping dropped by 19% year-on-year, with only 7% of consumers hitting the shops before 5 pm.

NRF2

My take

I’m bracing myself for the flood of press releases and expert commentary that accompanies the end of the Thanksgiving holiday in the US. The lessons I take from the weekend so far are:

  • Mobile investment is money well-spent in the retail sector.
  • In the US, despite the closure of stores by the likes of Macy’s, there’s still a lot of value to be had from the offline retail experience.
  • Outside of the US, the cultural appropriation of Black Friday isn’t as significant as we’re led to believe. And where it is in evidence, it’s online, not offline.

For my part, I went online to do some bargain-hunting on Friday. I made several purchases. None of them was in a Black Friday sale. From the retailers point of view, that’s a win, I guess.

Now for Cyber Monday!

Image credit - NRF/Target

Read more on: MobileRetail e-commerce and the omni-channel

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