Here’s What to Expect from the Most Unusual Black Friday in History
Black Friday set multiple records for retailers and brands in 2019. Online spending hit record highs, while in-store shopping spiked more than 4% year-over-year as consumers traversed the aisles for items like electronics, sporting goods and clothing.
It goes without saying that 2020 will be very different. Much of what Black Friday is all about — doorbusters and crowds — is set to change in 2020. Given the uncertainty about the possible third wave of cases and possible indoor crowd restrictions, retailers are under increased pressure to think creatively in order to save the season.
Despite the possible challenges around Black Friday in the face of the current pandemic, there are some positive indications that consumers are ready to spend. Opinions about the economic impact of COVID-19 have thawed: 58.58% of consumers surveyed in March felt that the pandemic would severely impact the economy, but just 20.81% held that same sentiment in August.
From a marketing standpoint, while many of us would simply like to put 2020 behind us and get back to normal, the reality is we must adapt to consumer needs. For marketers, it is vitally important to evaluate, evolve and execute against what we’ve learned over the past several months in order to be successful.
For those who don’t, the impact of making decisions based on what we used to know as normal could negatively impact sales and brand growth. Fortunately, consumer research and visitation patterns can help paint a picture of what Black Friday 2020 may look like — and how it will be different in just about every facet.
Shifting Norms and Moving Targets
The pandemic has accelerated digitization across every single business category, including retail. And while the impact has been notable, including greater adoption of e-commerce and the emerging popularity of online-to-store pickup, shifting visitation patterns and fewer trips with larger basket sizes shopping at physical store locations is still alive and well.
In fact, 65% of consumers plan on shopping in stores exclusively this holiday season and nearly 15% plan to do a combination of online shopping with curbside pickup.
While shopping this season is evolving, we can still expect many of the busiest shopping days to remain important for retailers with physical locations.
However, we should also expect spikes that are less pronounced than in years past, given possible capacity restrictions and consumers attempting to avoid crowds to stay safe from COVID-19.
On the promotional front, consumers are seeking value in an uncertain economy. As a result, we’ll likely see an extension of related promotions creating a “Season of Savings” vs. the traditional “Black Friday” event, which would enable more consumers to access deals over a longer period of time to align with changes in consumer behaviors.
Big Deal for Big Box
As consumers look to minimize their exposure to the public, we can expect fewer shopping trips overall, which is supported by visitation data, which revealed that major big-box retailers have lost approximately one trip per customer per quarter in the third quarter of 2020, compared to the same time period in 2019.
In contrast, the amount that consumers are spending is not expected to decrease. That means bigger receipts, and a bigger opportunity for big-box retailers who can provide a “one-stop-shop” experience. These retail destinations are able to provide value during tough economic times, extended hours to avoid the crowds, and inventory for everything ranging from gift cards, to groceries to clothes and toys.
For marketers, it may mean fewer chances to be in front of consumers during the key moments that matter to influence consideration and ultimately purchase. Consideration around how you reach these consumers during these moments and domination of share of voice or experience will require careful planning and coordination across media inside and outside the physical location and throughout the consumer journey and purchase process.
Tried and true promotional efforts like doorbusters will likely be shelved this season in favor of new services and innovative thinking as consumers embrace online with curbside pickup and multi-channel shopping.
New Innovative Promotions
The growing popularity of online to curbside pickup offers marketers new opportunities to innovate and promote these new services. In fact, this year we could possibly see the very first wave of online-to-store “curbside doorbusters,” as retailers increasingly look to accommodate consumer shifting consumer behaviors and needs.
These drive-thru deals could build on retailers’ ongoing “Season of Savings” discounts, while maintaining some semblance of traditional doorbusters experiences.
Additionally, value shopping is taking hold across all economic boundaries, especially on high-end retailers. We saw this early in the pandemic, with consumers switching to cheaper beer and private label brands up more than across all income groups and 12% overall according to an analysis of transactional data. Accordingly, we expect value-based messaging, saving and discounting along with free shipping offers to be front and center this holiday season.
The Gift Card Boom is Coming
Convenience and uncertainty will be center stage this year, which will have a positive impact on gift card sales. They’ve become enormously popular in years past, with 80% of Americans receiving one as a gift last year, for a 7% increase year-over-year. This year is shaping up to be a record year: In H1 alone, digital gift cards grew by 57% year-over-year due to the pandemic.
Given their flexibility, accessibility and appeal to a wide range of audiences, gift cards are expected to explode in the fourth quarter, with the spike starting on Black Friday. For marketers, this presents a new opportunity to cross-sell or upsell shoppers, knowing that they essentially have free money in their hands and wallets.
Half of these gift cards will be redeemed within 60 days of purchase, creating an extended holiday shopping season well into the first quarter of 2021. With an influx of foot traffic well into 2021 comes opportunity. Marketers who communicate in context to shoppers during and after the holiday will be well-positioned to win mindshare at moments during the purchase process.
The reality of the 2020 holiday season is that it will look anything but normal this year. As a result, marketers have to be proactive and reactive, quickly adapting to world events and shifting consumer behavior and needs.
Success this holiday and beyond will require marketers to carefully monitor and respond to consumer behavior in real-time, embrace multi-channel marketing and think creatively when it comes to promotions. They will also need to offer value during tough economic times, focus on convenience and safety and embrace key purchase trends.
Michael Della Penna is chief strategy officer of InMarket, a provider of 360-degree consumer intelligence and real-time activation for thousands of major brands.