After last year’s successful Black Friday, retailers felt confident that the next one would be an even bigger blowout, surpassing the 7.4 billion in sales earned in 2019. However, that confidence diminished the day COVID came rushing through the country like shoppers usually rush through its malls on November 27th.
Now, retailers are concerned that COVID will keep shoppers out of stores and that the stunted economy will keep money in their pockets. The biggest research firms’ predictions only add to these concerns. They expect this is going to be a challenging one.
That said, what marketer doesn’t love a challenge? Every retailer preparing for Black Friday 2020 needs to step up and find innovative ways to get shoppers into their stores or onto their websites. And after reading this guide, you’ll have a better understanding of the researchers’ predictions, and how to ensure sales during this cherished sale.
Black Friday 2020 and COVID-19
64% of consumers said they are less inclined to shop on Black Friday than they were a few years ago, according to a survey by Accenture. Facts like these, along with associated risks, have led some stores such as REI to announce they will be keeping their doors closed this Black Friday. But despite these buyer sentiments, retailers still have reasons to be excited about this holiday shopping season.
One positive is that retailers have had a lot of time to experiment with and standardize their protocols for keeping in-store shoppers safe during the pandemic. So, when the doors open on Black Friday 2020, they should be able to manage the masses more easily than if the pandemic had started last month. Another positive is that online shopping is booming. More than one-third of consumers shop online since the coronavirus hit.
Although economic strife is never something to cheer about, poor economic conditions do often make consumers even hungrier for bargains. Jack Kleinhenz, the chief economist at the National Retail Federation trade group, said this about this post-recession phenomenon.
“We’ve conditioned consumers especially coming out of the recession for promotions and discounting,”
But, since KPIs give the most insight, here are this year’s expectations for retail’s most critical KPIs:
Revenue is estimated to drop this year, due to shoppers’ hesitation to enter stores and economic hard times. However, predictions in unprecedented times are often littered with errors. For all we know, this year could be the best one yet.
● Average Consumer Spending:
Average consumer spending is expected to fall unless the increases in bargain hunting and eCommerce shopping outweigh the decreases in disposable income and store attendance.
Black Friday is usually a time for high-volume orders. This Black Friday, the AoV should still be high, but lower than usual. High volume discounts will be an eye-catching strategy for brands that sell products that are bought in bulk. For example, brands may usually sell packs of 6 “Frank’s Hot Sauce” for 25% off, but this Black Friday they will sell it for 60% off. It’s a deep discount, high-volume strategy.
● Average Delivery Times:
77% of consumers want online purchases delivered to their home this Black Friday. And the number of online purchases should rise this year. So, average delivery times should lag a little behind past years. But, retailers can make sure home fulfillment is efficient by ensuring that their supply networks are as flexible and quick as possible.
● Leading Categories:
While most consumers have focused their purchases on essential items during the pandemic, their appetites might again light up for luxury products like jewelry or clothing this Black Friday, according to Dora Bock, Associate Professor of Marketing at the University of Alabama.
Computers and electronics are always big hits during Black Friday. Desires for these products could increase this year because people want the best gear possible to communicate with their loved ones and work from home. Additionally, many former city dwellers have recently moved into houses in the suburbs due to the pandemic. Houses have more space to fill than apartments, so furniture, television, and landscaping tools sales could rise.
Falling categories include products used in groups (basketballs, pool games, etc.).
Black Friday 2020: The 8 most crucial things to consider in retail
Armed with metrics from past shopping seasons and a deeper understanding of COVID-era eCommerce and retail, businesses can make adjustments to their Black Friday marketing plan to ensure that this sales opportunity remains as profitable as possible. Here are key considerations about Black Friday 2020 for retailers.
1. Expect no queues this year
The roaring crowded lines that decorated Black Fridays of the past will not appear this year. Big box stores might still witness long lines (maybe even longer). But, the length won’t be from more people. Its length will come from social distancing efforts. Expect lines of small groups separated by 6 feet of distance.
2. Higher competition
This year, Amazon has thrown a wrench into many retailers’ strategies by moving “Prime Day” to take place on Oct. 13th and 14th. This change could pull holiday sales up, allowing Amazon to steal market share.
To counter this, some retailers are having October sales of their own. For example, Target is hosting “Target Deal Days” during the same two-day period.
3. Lower consumer spending
The COVID crisis has hit consumers hard. Job loss has many “would be” Black Friday buyers focusing on spending on the more essential aspects of their lives such as rent and food.
While some revenue is lost, retailers can still capture the market of people who aren’t shopping because of fear of COVID infection by focusing attention on their online stores.
4. Stress test your eCommerce site
You want to be sure your eCommerce site is prepared for the increase in traffic when you offer those delicious deals. Compression, software caching, and similar tactics may provide further enhancements for loading times during busy periods.
Also, it’s a good idea to make sure you are protected against any hacking. Unfortunately, hackers have prioritized Black Fridays in the past. So, it’s best to invest in your eCommerce security through extensive encryption, plugins, and web application firewalls.
5. Finetune your logistics
COVID has given businesses their fair share of logistical problems. And although most have been smoothed out, large spikes in demand like during Black Friday 2020 can create new challenges. Not to mention, more people will be ordering products to their homes this year. So, you need to have your logistics in order.
Retailers should increase supply chain visibility and streamline their processes with the help of technology. And don’t forget to make it easy for customers to order digitally and pick-up on the curbside.
6. Prepare a Plan B (and Plan C)
Since this will be a Black Friday like no other, it’s hard to predict what can go wrong. Therefore, it’s important to have some plans in your back pocket. For instance, if your online store crashes, you need to have a team prepared to instantly get it back online and avoid missing out on sales. For each possible risk, put someone in charge of the response. That way your team can jump into action ASAP. Also, prepare a crisis management plan in case something breaks and hundreds of social media complaints occur, remember you can always turn the negative feedback into a loyal customers.
7. Think Digital-First this Black Friday
Since it’s almost impossible, and bordering on unethical, to persuade frightened shoppers to come into your store, it’s important to focus on where you can generate demand: online shopping. You can do this with popup ads, marketing emails, and even blog posts about amazing deals you just have to share.
Plus, you should make sure you use an omnichannel customer engagement platform to deliver personalized customer experiences throughout each step in the journey leading up to purchase this Black Friday.
8. Consider running Pre-Black Friday promotions to dilute the risk
Many companies are running promotions during the entire month of November. Or at least, they aren’t confining their deals to Black Friday itself. Expanding your promotion length will help you reduce the risks to your customers and capture more of the market from competitors.
It’s also smart to share with your in-store customers your plans for making their visits as safe as possible. This will increase their confidence in your brand.
The Hard Work Will Pay Off
In business, being prepared as early as possible is essential to coming out on top. Although preparing your website, stores, and consumers’ brand awareness will take a lot of work in these upcoming months, the pay off of a successful Black Friday will be well worth it. Plus, under these new conditions, you will acquire valuable skills that will help you and your team shine on Black Fridays for years to come.