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Featured Sep 28, 2020 8 min read

Will Black Friday exist in 5 years?

An industry on the brink of a reset and pressure from consumers demanding change. Could this spell an end to one of the most significant events on the retail calendar?

Monki Email Uk 25 Nov 2019

The uprising continues against the industry’s return to a ‘normal’ where excess consumption and profits is prioritized over people and the planet. As a result, the relevance of Black Friday in a post-COVID world is being questioned and retailers explore alternatives to mass discounting.

The pandemic has encouraged retailers to rethink and reset their traditional trade processes, helping to break fashion’s addiction to discounting. Combined with the number of retailers who boycotted  the event last year as a stance against overproduction as well as the new wave of conscious consumers, could this spell an end to one of the most significant events on the retail calendar?

Key takeaways 

  • So far, there is nothing to suggest Black Friday won’t go ahead for the majority of online retailers this year. However, it has been losing its luster for several years now and will certainly never be the same again post-pandemic.
  • Steep markdowns taken at the height of the pandemic combined with retailers trying to break consumers’ addiction to sales will make it challenging to justify an aggressive discounting strategy this Black Friday. 
  • COVID-19 has acted as a catalyst for a more considerate approach to retail processes. It is backed by new consumer groups investing in the brands striving for positive change, giving back to social causes and supporting small businesses, indicating a shift away from the excessive consumption popularized throughout this event. 
  • Retailers may be tempted to markdown heavily if consumers have less disposable income post-COVID. Yet, it opens up a broader conversation for businesses to re-examine their pricing structures to ensure it serves those on both ends of the supply chain.

Whatever direction you take this year, your Black Friday strategy is not complete without retail market intelligence. Find out how EDITED data can help your business trade during this crucial period. 

And when developing future strategies, take these five considerations into mind.

1. Is it preventing full price sales?

Month-long discounts are making the event redundant

As expected, the proportion of products reduced in November 2019 in the US shows a clear spike around the Black Friday period. What’s interesting is the average discount amount was at its highest over the event, but it still didn’t fall below 40%, indicating substantial markdowns offered throughout this month.

In the UK, discounting was more conservative. There was an apparent rise in the reduction rate over Black Friday, yet the proportion of products marked down dropped compared to the start of the month.

Combined with Singles Day on Nov 11th and Prime Day‘s potential move to October this year, Q4 is set to be even more discount-laden than usual. The month-long reductions and pre-sale events have trained customers to expect sales outside of the allocated period, making it even more challenging to sell at full price and diminishing the impact of these events.

2. Are aggressive reductions necessary?

With reductions reaching Black Friday levels due to COVID-19, retailers need to wean customers off heavy discounting

Discounting is at a saturation point. Last year, retailers hit peak Black Friday and pulled back on discounting as deep as previous years. While the pandemic’s disruption may be tempting to use this year’s event to reduce prices severely, it will only harm retailers in the long run. 

Research by PwC found online discounting in May reached Black Friday levels with retailers slashing prices to sell through the inventory piling up due to store closures. EDITED data supports this.

Comparing the average weekly discount throughout May vs. the 2019 Black Friday period confirms reductions were taken at a similar rate. For the US, on average, the weekly discount amount was 44% – on par with 45% during Black Friday. May coincided with two UK bank holidays and bumped the average weekly discount amount to 37%, higher than 35% over Black Friday.

US retailers discounted a greater proportion of their online stock in May compared to the Black Friday period. The weekly average of products reduced in May is 52% compared to 47%. For the UK, proportions were level at 43%.

In addition to summer sales starting earlier, businesses can’t afford to go any deeper post-COVID. Retailers need to recession-proof their discounting strategies, steer clear of aggressive markdowns favored during the previous GFC, which sparked customers aversion to paying full price for products. Last year’s Black Friday proved heavy markdowns aren’t always an incentive to buy – this was especially prominent in the UK where the bulk of Black Friday sell outs were discounted between 20-30% off in contrast to the US at 50-60% off.

Are you an EDITED Customer? For more data insights, log in to read our report Considerations For Successful Black Friday 2020 Planning.

3. The great reset and the new consumer

An industry-wide reboot will benefit all retailers, aligning with the values of post-pandemic consumer groups

As physical fashion weeks resume, interest in the issue that arose around rewiring the fashion calendar during the early days of the pandemic has subsided. While it may take 12-24 months for any changes to be in place post-COVID, an industry-wide reboot holds value for brands of all sizes. Product seasonality has become increasingly out of sync with today’s customers ‘buy-now wear-now’ preference, resulting in premature markdowns that fuel events such as Black Friday.

With products dropping closer to season, discounting can reset to its original cadence and return to being used as a tool to clear slow-moving stock twice a year, eroding the often-described rampant consumerism associated with heavy discounting events like Black Friday.

The purpose-driven consumer is educated on how businesses are treating their workers and the planet. Along with the rise of CARLY, the community-driven Gen-Z cohort which demands transparency from its brands, there is a reckoning of consumers trying to promote positive change and prevent the industry from returning to its destructive ‘normal.’

Examples from last year that resonate with this group include Sézane promoting ‘Give-Back Friday’ – donating 10% of US sales to Pencils of Promise or Everlane’s Black Friday Fund. Green Friday continues to gain traction. Last year, Roberto Cavalli collaborated with Treedom to plant a tree for every purchase from 1,000 customers.

Sézane Email US 29 Nov 2019

Some may argue Black Friday discounts allow people to purchase goods they couldn’t usually afford ahead of the holidays, perhaps even more crucial due to the rising unemployment rate from COVID-19. However, the added discount to the already low cost to the consumer usually means marginalized communities in poorer countries are suffering for it and are most at risk to the impact of throwaway fashion purchased during these blowout sales being discarded shortly after.

With awareness growing around Intersectional Environmentalism and the welfare of garment workers, retailers and consumers are taking a stand against overproduction within the industry and opting to boycott the event altogether.

Brother Vellies uses Black Friday to educate consumers that it never goes on sale to ensure its artisans are paid fairly. This also appeals to the price aware consumer, who understands the costs of running a business and supports more modest companies prioritizing Small Business Saturday over Black Friday.

Brother Vellies Email Us 20 Nov 2019
Brother Vellies Email US 20 Nov 2019

For businesses that can’t afford to cease trade, the rise in community importance can compliment the reframing discounting periods as rewards for loyal consumers. Last Black Friday, Eileen Fisher offered 20% off as a thank you for being part of the community while LN-CC promoted a private sale.

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Eileen Fisher Email US 29 Nov 2019

4. Alternatives to sales

With the event now digitalized, retailers need to engage with their consumers outside of discounting

Retailers are clued in on the reset of values post-COVID. Walmart plans to break its decade-long tradition of starting Black Friday sales early on Thanksgiving Day, shuttering stores and encouraging employees to spend the time with loved ones while paying $428m in special bonuses. Target, Kohl’s and Best Buy have also just announced they will be closed for the day. While Walmart is yet to comment on whether its stores will reopen for Black Friday, there’s no doubt all retailers will struggle holding in-store events this year with fears of spreading COVID-19. The pandemic will see the event shift even further to digital, making it all the more important to engage with online communities.

Instagram Walmart
Instagram @Walmart

Even before store closures, retailers used their platforms to engage with consumers over this time without promoting deep discounts. Last year, Eastpak veered away from promotional activity to share positive stories on Black Friday. Cuyana brought the focus back to giving with intention, and shared one gift a day from Black Friday to Giving Tuesday as well as offered complimentary monogramming and handwritten notes. #blackfriday currently has 383.6M views on TikTok, presenting an opportunity to connect with the Gen-Z users who are shaping these events’ future.

5. Does the event need a rebrand?

In recent years, an internet rumor circulated suggesting that Southern plantation owners could buy slaves at a discounted price following Thanksgiving in the 1800s. While it’s been debunked by multiple sources, retailers getting on board this year should look to reposition the event to remain sensitive to the Black Lives Matter movement. Alternatives from last year span from ‘Cyber’ and ‘Super’ sales to riffs on product categories.

Examples of alternative messages from retailers in 2019

  • Cyber Sale: Carbon38, Koral, Nordstrom, Boden
  • Indigo Friday: Levi’s
  • Pink Friday:  BySymphony 
  • Super Sale: Negative Underwear
  • Green Friday: Roberto Cavalli
  • Friends Friday: Esprit
  • Feel-Good Friday: Free People 
  • Bag Friday: Lulu Guinness
  • Best Friday Ever: Accessorize 
  • Seasonal Sale: Rachel Comy
  • Semi-Annual Signature Sale: Hanky Panky
  • Stack Friday Sale: Alex and Ani
  • b Friday: Agnès b

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