What retail data reveals about Black Friday trends
Black Friday and Cyber Monday are over once again! We crunched the numbers to bring you the most notable shifts in our post mortem report.
While some businesses are breathing a sigh of relief, savvy retailers know they need to review what went down and put a plan in place for 2020. To help, EDITED has crunched the numbers to bring you the most notable shifts this year in our Black Friday and Cyber Monday post mortem. Get your strategy backed up by retail analytics instead of guesswork!
Black Friday buzz keeps getting bigger every year as more retailers opt in (and out!) of the event. With so many promotions running at once, it can be challenging to keep up with what’s happening in the market.
EDITED’s retail decision platform can help businesses cut through the noise. Our team of experts can help you plan your product, pricing and promotional strategies for peak discount periods. Find out how.
Most US retailers ran offers in the week leading up and made their deepest discounts on Black Friday. The same promotions then continued over Cyber Weekend until Monday, instead of increasing in percentage over time.
Fast fashion retailers shook up their strategies this year. Zara grew last year’s offer from 30% off the full collection to 50% off selected items. H&M pulled back the number of marked down stock but offered an average discount of 49% off – the deepest the retailer has gone on Black Friday over the past two years.
Concerns grew around the cost of e-commerce returns. Retailers tried to combat this by pulling back on stocking and discounting products with complicated size runs during this period.
30-40% off was the favored discount bracket by retailers on Black Friday. EDITED’s data proves prices didn’t need to be slashed too dramatically to sell through – items reduced by 20-30% saw a higher percentage of sell out
Sustainability was more of a focus this Black Friday than in previous years as many used this time instead to preserve margin, raise environmental awareness or donate to charity.
So, Black Friday just happened. What promotions were retailers offering? When was the key time for markdowns? Which discounts drove sell outs? All these questions are essential in planning an airtight strategy for next year’s event. Read on as we shed some light on the biggest shopping event of the year.
Retailers were discounting deeper, earlier
There is no need to wait until Cyber Monday to move through stock with aggressive markdowns. Most retailers ran offers in the week leading up and then made their deepest discounts on Black Friday. The same promotions then continued over Cyber Weekend until Monday instead of increasing in percentage over time. Banana Republic, for example, opened the week with a 40% off promotion, which deepened to 50% on the Wednesday and carried on until Cyber Monday. In the UK, boohoo went straight to market with an ‘up to 75%’ offer. When Cyber Monday hit, the promotion dropped to 30% off.
Both of these retailers were among those who promoted ‘x amount of new styles added’ in their email communications. This tactic helps keep customers enticed to shop for newness after a week of being bombarded with heavy discount messaging.
Retailers such as Gap used Cyber Monday to offer basket codes on top of blanket discounts to freshen up the offer. Everlane went in a different direction on Cyber Monday, advertising a ‘choose what you pay’ offer on selected products.
Some major players shook up their strategies
How have retailers evolved their strategies over time? Traditionally, Net-a-Porter only promotes the sale once (on the actual day of Black Friday) in an email to customers. This year, the luxury e-tailer communicated its offer earlier on the Thursday of, and increased mentions of Black Friday by promoting the event on its homepage.
Zara deepened its discounting strategy, growing last year’s 20% off selected items in the UK to 40% off, and 30% off the full collection in the US turned into 50% off selected items. In the US, tops and accessories were the categories that received the most reductions for the first time over the long weekend of sales. Zara also focused on tops, bottoms and outerwear. Dresses made up 9% and 11% of first discounted product at Zara in the US and UK, respectively. While the fast fashion retailer excluded partywear styles, its viral printed midi dresses were slashed between 50-60% off (US) and 40-50% off (UK) for the event.
H&M also offered more substantial reductions this year. On Black Friday, the average discount percentage on the US site was 49%, the deepest the retailer has gone over the past two years. However, H&M did pull back on the proportion of its range being discounted with 19% of available products reduced. This is less than the past two years, where 32% and 50% of products were discounted in 2018 and 2017, respectively.
This is the case for Glossier’s hotly-anticipated Black Friday deals. As per last year, the beauty unicorn ran 20% off online, yet this year the offer extended to the pop-ups currently running in Austin and London. Additionally, Glossier launched limited edition sets of its best-selling items with a ‘save 35%’ offer over the long weekend.
The cost of returns were on everyone’s mind
Return rates are estimated to cost e-commerce businesses $550 bn by 2020. This is an issue that is apparent all year round, particularly amplified with heavy discounting periods such as Black Friday.
In the lead up to Black Friday, we noted US retailers stocking less product categories with a complicated size range in an effort to avoid the costs involved in mass returns. We advised retailers to be strategic in marking down product assortments, stating products without a wide size range are ideal for reducing to minimize returns during the sale period.
This Black Friday period continued the ongoing trend seen from the past two years with tops and accessories being the categories with the most discounted items. Meanwhile, retailers pulled back on reducing products with multiple size runs. The number of footwear marked down for the first time the week of Black Friday sales declined by 7% YoY. Discounts in the overall bottoms category experienced a 9% decrease driven by fewer markdowns taken on jeans (down 11% from last year) and skirts (down 20%).
Retailers can measure the success of discount percentages offered in the market by using EDITED data. On the Friday, 50-60% was the discounting bracket that saw the highest number of product sell outs. While 30-40% off was a favored discount bracket by retailers on Black Friday, 20-30% saw a higher rate of product sell out. This data proves that while deeper discounts are enticing for customers, prices don’t need to be slashed too dramatically to sell through.
Black Friday is one of the most crucial sales periods with digital sales this year reaching $7.4 bn, according to Forbes. To capture this spend, retailers plan the event so far ahead of time to ensure their offers are executed seamlessly. An effective Black Friday strategy is one that can clear out excess or slow-moving stock ahead of the New Year without destroying your margin.
Yet, the growing environmental concerns paired with more frequent promotional strategies has resulted in discounting fatigue from consumers, leading to retailers that opt out of running sales.
Instead, many retailers used this time to preserve margin, raise environmental awareness or donate to charity. Monki backpedaled last year’s message of ‘BLK FRI-YAY’ to promote ‘BLK FRI-NAY’ and continued to trade without running a promotional offer. In addition, Everlane continued its Black Friday Fund. This year, the retailer partnered with Oceana, an organization that works towards the global protection and restoration of oceans, and donated $10 from every purchase on Black Friday to the charity.
Allbirds took a more creative approach with its bricks-and-mortar stores. The footwear brand shuttered its London Seven Dials shop and e-comm site to host interactive workshops with consumers.
The movement was even felt in the beauty industry. DECIEM, the cult skincare company behind The Ordinary, opted out of trading during Black Friday and closed its stores and ecommerce site on November 29th. However, the skincare brand did run a 23% off promotion up until the closure and traded on Cyber Monday.
#boycottblackfriday and #greenfriday hashtags were trending throughout November. In France, 200 brands formed the “Make Friday Green Again” campaign, which pledged to avoid running promotions on the day and donate sales to nonprofit organizations.
After the Climate Strike earlier this year, fashion retailers and consumers are continuously under the microscope for the effects our fast consumption has on the planet. As these issues continue to grow, we can expect more retailers to take a stance on these issues, which will result in earning the trust and potential business from Gen-Z customers who are prominent in environmental movements. In 2020, sustainability can be expected to be a higher priority within retailers’ Black Friday strategies.
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