Black Friday and Cyber Monday have historically been among the biggest deal days of the year, evolving from single-day events to a month-long “Black November” of sales. This year, soaring inflation and the cost of living crisis have seen retailers stretch the event out even further, some as early as October, to secure a share of shoppers’ potentially limited spending.
Will Black Friday bring the same rush for shoppers and the same profits for retailers and brands this 2022?
The potential is there, but the opportunities have changed drastically since the pandemic, driven largely by inflation and a shift back to omnichannel shopping over dominantly e-commerce. Consider this…
Shoppers have shifted their buying patterns in light of inflation, but they still plan to spend on holiday gifts.
In a recent survey of 3.5K US consumers by Klaviyo and Qualtrics, 67% of respondents said inflation is affecting their spending decisions. But the shift in spending varies across different demographic sets, with some increasing budgets on some categories and decreasing budgets on others. The majority of respondents - 54% - say they plan to spend the same amount on holiday gifts this year (at least $250 on average), and 11% plan to increase their spending.
In-store shopping will impact Black Friday sales and holiday gifting.
The same survey showed that only 13% of people plan to do their holiday shopping entirely online. The vast majority - 75% - plan to do 50-75% of their holiday shopping online and the rest in-store. This shift back to omnichannel is further reflected in the growth of brick-and-mortar spending in 2022:
- According to data from the U.S. Bureau of Commerce, brick and mortar sales grew faster than e-commerce sales in 2021, at a rate of 18.5% (versus 14.2% for e-commerce).
- In the first seven months of 2022, there have been more than twice the number of store openings than store clothes. Coresight Research reports 4,432 new store openings compared to 1,954 store closures equaling a net gain of more than 49 million square feet of new retail space.
- eMarketer predicts that e-commerce growth will severely decelerate in 2022 to around 9.7%, vs 17.1% in 2021.
There’s no question that e-commerce will remain a growth driver for retail, but not like it was before. Brick-and-mortar retail isn’t going anywhere, and in many ways it’s experiencing a renaissance as digital native brands turn to brick-and-mortar to bring their stories to life (see Allbirds, Everlane, and Glossier for example).
This Black Friday and Cyber Monday, omnichannel will rule the day. Shoppers will not only be visiting stores in increased numbers, but also using e-commerce websites to research the hottest deals. In the USA, Walmart and Target remain the most dominant omnichannel players. According to DriveResearch.com, after Amazon, the majority of online shopping during Cyber Week 2022 will be on Target (51%) and Walmart (50%). Both retailers are offering early discounts.
The shift to e-commerce during the pandemic left some wondering if the trend would stifle physical retail forever, making brick-and-mortar shopping obsolete. In response, advertisers and marketers shifted their campaigns to prioritize online shopping and data targeting. In 2022, following two pandemic-disrupted holiday shopping periods, a more nuanced omnichannel approach is required to influence today’s shoppers around key holiday shopping events like Black Friday.
Today’s shopper wants to enjoy the sensory experience of physical stores alongside the convenience of online shopping, a major channel for product research - 81% of consumers conduct research online before making a purchase. They’re also increasingly cash conscious and interested in other issues like energy efficiency and sustainability. Shopify reports that 76% of shoppers are looking to spend on quality items that last and 40% of shoppers will pay more for sustainable products.
5 Tactics to Win Black November and Beyond
- Tie together online and offline data with cross-device targeting and geolocation tools so you can reach shoppers with the right campaigns in the right retail channel
- Use predictive analytics to anticipate shopper behavior. Shopper behavior changes constantly. Machine learning tools can help you track and anticipate shifting patterns around Black Friday and other key shopping periods
- Overcome inflation challenges by focusing on a portfolio mix of where to discount, for example bundles and multipacks which help to increase the average order value
- Re-evaluate your product positioning where possible. Now’s the time to push your merits when it comes to cost-saving, energy-efficiency and sustainability.
- Play the long game. Use influencers and owned marketing channels (social media, newsletters) to drive traffic well ahead of Black November
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