Did Black Friday pack a punch for online retailers in 2014?

Posted: Thursday 4th December 2014 in Paid Media, Retail Strategy, Thought Leadership.

Black Friday has become the biggest shopping day of the year

Black Friday is an American phenomenon which has been getting gradually more popular in the UK over recent years. The first Friday after thanksgiving, viewed as the start of Christmas shopping, is marked by huge discounts from many retailers and is routinely the busiest shopping day of the year. In-store discounts in the UK this year saw customers physically battling one another for the one-day-special deals on electronics, homewares and other goods.

Last year Black Friday made a big impact in the UK, with revenue growing by 6%. See our Christmas trading insights for more information from peak 2013.

How did UK retailers fair this year?

65% of British retailers planned Black Friday promotions this year, confirming that the UK has truly adopted the American trend. Big name brands such as Tesco, Marks and Spencer, Argos and Dixons all had big Black Friday discounts, and grocer Sainsburys was one of the many who took part for the first time this year. Tesco Direct saw five times the number of online visitors they had at the same time last year and retail giant, John Lewis, saw sales rise by 21.9% for the trading week that included Black Friday. Several of Summit’s retail clients saw an overall revenue increase that exceeded John Lewis’s sales growth, and traffic across our clients was up by 55%. We found that some of the other digital marketing channels working alongside paid search, such as Google PLAs, played a more significant role than expected.

Retailers’ expectations exceeded

Some retailers across the UK failed to take advantage of the increased demand by underestimating just how popular the deals would be. Several, including PC World, Boots and Asda did not adequately prepare their websites to cope with the pressure of the increased traffic, and consequently many sites crashed in the early hours of Friday morning. Those who were savvy (including Argos and Curry’s) ensured that that they limited site visitors and setup a queuing system that was once limited to the in-store experience. Many retailers also underestimated the popularity of in-store deals, with Asda and Tesco staff having cause to call the police in to resolve conflict, despite preparing with extra staff and security.

The Black Friday aftermath

Black Friday saw shoppers descend on retailers en masse, looking for deals on Christmas gifts and items for themselves. An emerging trend this year has been for consumers to take advantage of the lower prices by buying in bulk and then reselling at a profit on eBay and Amazon. However early reports suggests that resellers are struggling to sell the products they have purchased.

The Wednesday following Black Friday has been termed Boomerang Wednesday, as consumers have second thoughts and return their Black Friday purchases. This week last year saw parcel returns grow by 25%, and this is expected to increase this year.

In summary

Black Friday packed a punch in more ways than one for UK retail:

  • Some retailers took a knockout hit as they found their sites unavailable for periods across the day with revenue missed and marketing spend put on pause
  • The price reductions on home electrical goods across major supermarkets led to consumers coming to blows after hours of queuing
  • In contrast to the UK, the US failed to live up to the hype with an 11% year-on-year decrease in revenue

If you would like to know more about Black Friday or find out how Summit can help you make more money online, contact Dave Trolle on (01482) 876876.