What should and shouldn’t be discounted for Black Friday 2020
With only one month left until Black Friday, a look into the biggest trends from last year and the products to mark down...
You’ve spent months feverishly working to lock and load your discount strategy for Black Friday. However, there is still time for last-minute tweaks to save your margins from any unnecessary damage. We breakdown the biggest Black Friday trends to come out of last year and layout what products to reduce and avoid discounting.
With a little over a month until the big day, you should be making sure any items such as recent hot sellers (yes, seamless bodysuits, we’re looking at you) aren’t lined up for 60% reductions over Black Friday weekend, as well as monitoring the shifts your competitors are making.
The success of Amazon’s Prime events coupled with the ever-growing environmental concerns associated with massive sales periods has seen Black Friday lose its luster for some time. For more insight into Black Friday alternatives and the relevance of mass discounting in a post-COVID World, read our recent report – Will Black Friday Exist In 5 Years?
The current state of play
Retailers have been pulling back on discounting products exclusively for the event, due to the high amount of products warranting a first reduction in March when COVID-19 broke out. Though products seeing first discounts have since dropped off, discount depths are high as markdowns reached Black Friday 2019 levels throughout May. For the US, the average weekly discount amount was 44%, on par with 45% during Black Friday last year. The month of May coincided with two UK bank holidays and bumped the average weekly discount amount to 37%, higher than 35% over Black Friday.
Such aggressive discounting early on has registered in 32% and 45% fewer products reduced for the first time in the US and UK for September. New product arrivals continue to decline, making way for impending markdowns. Over the past six weeks, newness is down 17% in the US and 22% in the UK YoY.
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Strategize to avoid returns
Analyzing your competitor’s assortment breakdown can help reveal the categories with the potential for reduction over the holidays.
As the second wave approaches, consumers will be hesitant to go into stores creating an opportunity to reduce products without a wide size range. In the US, accessories equal nearly 25% of products in stock and 20% in the UK. Across each region last year, it was one of the top three categories reduced. Coupled with waning interest in handbags and jewelry as consumers spend more time indoors, accessories are the ideal category to reduce in order to minimize returns during the sale period. However, hold off on discounting too deeply on items that can fall under “webcam wins” such as chunky chain-link necklaces and drop earrings – making a statement over Zoom meetings will remain relevant going forward.
Look to pull back on categories with more complicated sizing as the sales approach. Currently, there are 16% and 9% fewer bottoms products available in the US and UK respectively compared to last year, while footwear available online has declined and 5% and 9% YoY.
Dressing for the new normal will continue to influence discounting for the upcoming season. Though tops were the most marked down products over the Black Friday period, they have emerged as the hero category of the pandemic wardrobe, selling globally with a notable success of an 11% increase YoY in the US market.
How much to reduce by?
So far in the US, the most popular advertised discount is between 40-50% off, representing 25% of discounted mens and womenswear products. At this time in 2019, the strongest advertised discount was between 20-30%, showcasing retailers are discounting deeper earlier.
A similar pattern is noted in the UK, where the majority of products currently reduced are between the 30-40% threshold, higher than last year, and favored the 20-30% off range.
This suggests Amazon’s delayed Prime Day dates (Oct 13th-14th) has incentivized retailers to take steeper reductions earlier. However, this can risk tarnishing brand value and doesn’t always lead to higher sell outs. Black Friday 2019 saw the bulk of sell outs in the UK discounted between 20-30% off in contrast to 50-60% off in the US. Additionally, full price products in the UK made up 47% of sell outs over the past six weeks compared to 36% in the US, further indicating the American consumer is more discount-driven.
Remember, Black Friday is an opportunity to clear out older and slow-moving pieces ahead of the peak Christmas period and ring in the new year with a fresh assortment. Avoid reducing these items that have performed well and have longevity for future collections.
Seamless active and daywear
Positive pink hues
Prime for reduction
Consumers’ current penchant for comfort dressing has led to pumps suffering in the footwear category. In the US, the most common discount bracket for this style already is 40-50% off compared to 20-30% off for sneakers.
On the Spring 2021 runways, tropical prints were dwarfed by nautical and under the sea influences to convey escapism making Black Friday an optimal time to reduce spring 2020 styles. Over half of swimwear is currently reduced in both regions advertised at an average of 46% in the US and 48% in the UK.
With events paused and WFH the new norm, it’s been hard to shift dresses in 2020. While the house dress and roomy, loose-fitting styles are slated to succeed in spring 2021, Black Friday serves as an opportunity to clear through slow-moving or traditional workwear options.
The uncertainty surrounding the festive season spotlights nostalgic trends as a risk-free story. Reintroduce sequinned styles reminiscent of 70s disco or Y2K clubbing post-sales as partywear staples.
Skinny jeans are gathering higher discounts as working environments evolve, currently discounted between 56%-58% at an average of 41%-46% across both markets. Keep comfort in mind and save high-stretch styles from unnecessary reduction.
While discounts for jeans are outpacing sweatpants, fatigue is settling in. With more refined styles paving the future of men’s loungewear, keep elevated styles like tailored joggers and sweat shorts in premium fabrics free from markdowns to target the slower moving sweatpant styles.
Consumers want products that serve the comfort or outdoor aesthetic, making workwear and tailoring a red flag. The time is right to reduce slow moving suits and suit pants, formal blazers, dress shirts and Oxford loafers. Lounge shirts and casual loafers can be promoted in more laid-back edits after the sale.
There’s no replacement for hard data when you’re tackling your trickiest discounting decisions. Get in touch here to learn how EDITED can help engage customers without sacrificing margins during peak sale periods.