Black Friday spending to increase to R11.3bn this year — study
In November 2019, retail spending during Black Friday was R15.4bn. It was R10.2bn in November 2020, and is expected to be R11.3bn this year
Retail spending on Black Friday will improve this year compared to 2020 but it will not be better than 2019, according to research.
“Black Friday 2021 will not be as good as in 2019, but will be better than 2020 due to the fact that while 2.1-million people lost their jobs during 2019 to 2020, 733,000 new jobs were created during 2020 to 2021,” said Prof Carel van Aardt from Unisa’s Bureau of Market Research.
Van Aardt was speaking at a media briefing on Black Friday, in which he tabled findings of a study conducted on the trends and dangers associated with Black Friday, and retailers that score big during the period.
The new jobs created in 2020 and 2021, Van Aardt said, would benefit retailers during Black Friday 2021.
In November 2019, retail spending during Black Friday was R15.4bn. It was R10.2bn in November 2020, and it is expected to recover somewhat to R11.3bn this year.
According to Van Aardt, there are different reasons that consumers spend on Black Friday.
“The middle and affluent market buy luxury goods at discounted prices. It [Black Friday] arouses a lot of buying behaviour,” he said.
Consumers also shop because they are bored. They also buy goods at discounted prices that they usually would not buy.
He said between 2019 and 2020, a growing percentage of Black Friday spending was on necessities. This, he said, was due to large-scale job losses and low-income growth in 2020.
“Whereas expenditure on textiles, clothing, and footwear showed strong growth before 2020, such growth was negative during 2020. It is clear from available statistics that compared to 2019, consumers were buying down when buying such goods in 2020,” Van Aardt said.
He said the retail pattern in 2020 was “very volatile” compared to the pattern in 2019 due to the lockdown and a volatile business cycle impacting on this pattern.
According to the research, people now have less interest in brands than before.
Retail subsectors which will gain the most Black Friday sales include general dealers and retailers in textiles, clothing, footwear and leather.
Van Aardt said the country could not afford to have another hard lockdown because the level of job losses would be “humongous”.
“I don’t foresee another hard lockdown. I think we will be seeing a selective lockdown,” he said.
Connect Group CEO Steven Heilbron said retailers should not be waiting for Black Friday or big events to make money.
“There needs to be a constant focus on thriving, not on surviving. Many of the trends we face are not new. Covid-19 has escalated these trends,” he said. “We do expect the fourth wave to have less of an effect. It’s up to retailers to thrive within the context of the conditions we face.”
To capitalise on Black Friday, retailers should make sure they have the right inventory to attract customers, Heilbron said.
“It’s important to understand the market within which they operate, and notice the trends. You need to innovate and have good ideas. You need to out-think and outsmart your competitors,” he said.
Would you like to comment on this article or view other readers' comments? Register (it’s quick and free) or sign in now.
Please read our Comment Policy before commenting.