A year like no other is producing a Black Friday holiday promotion like no other.
A charitable description of the year 2021, both for retail and in general, might be “different.” And that difference extends to the timing of when retailers are officially launching their major holiday promotions.
Retailers used to kick off their holiday promotions in earnest the Friday after Thanksgiving, a day which came to be colloquially known as “Black Friday.” In recent years, Black Friday sales started popping up a week or two before the Thanksgiving weekend. This year, Amazon and Target both began holiday discounts in earnest in early October, and every day it seems I write an article on at least one more retailer announcing that Black Friday will arrive by the beginning of November.
All this early Black Friday activity isn’t happening in a vacuum. Here are three significant impacts it is creating on the wider retail industry.
Now or never
When virtually every major retailer is offering a full-fledged Black Friday promotion within a few days after Halloween, waiting until Thanksgiving to start Black Friday is no longer an option. With surveys showing more than four in 10 consumers have already begun their holiday shopping, it is logical to assume they will gravitate toward retailers offering well-advertised holiday discounts.
And once customers start frequenting certain holiday-friendly stores (or sites) in October/early November, the odds are they will stick it through December. So, retailers that want to actually benefit from their Black Friday promotion have two choices on when to launch it – now or never.
If you think shelves are empty now…
The supply chain is disrupted, due to factors ranging from COVID-19 to labor shortages to lingering aftereffects of the March 2021 Suez Canal blockage. As a result, supply chain costs are rising while stock levels continue to dwindle.
Unfortunately, supply chain issues are poised to continue, and even get worse, through the holiday season. Many top-level Tier I retailers, including Amazon, Walmart, Target, Lowe’s, Home Depot, and Gap, have been positioning their stock levels and supply chains since the summer and should be able to mostly keep physical and virtual shelves full of products holiday shoppers want to buy.
As for the rest of the industry? There is no easy short-term fix to this global problem. However, retailers can maximize the throughput of whatever inventory they can obtain by leveraging third-party distribution and delivery platforms, which can often be set up in a matter of days. In addition, retailers may be able to quickly and cost-effectively set up basic systems that streamline inventory tracking by scanning RFID tags or UPC barcodes.
In terms of acquiring extra inventory, retailers would be advised to avoid gray (or even black) markets, but brokers and platforms exist that can connect retailers in need of product with reputable sources, such as liquidation auctions and bulk resellers.
Overlook Cyber Monday at your own risk
Survey after survey indicates consumers are shopping for the holidays early, and online. Recent data from Adobe indicates U.S. online holiday sales will reach $207 billion, up 10% from 2020. And every early Black Friday promotion prominently features in-store pickup and home delivery options for online purchases, with many offering special deals only for digital purchases.
Furthermore, Thanksgiving is emerging as a significant online shopping day, as many retailers are now shuttering stores for the holiday.
However, according to Adobe Analytics, U.S. consumers spent a record $10.8 billion online during Cyber Monday 2020, an increase of 15% year-over-year. Cyber Monday 2020 stands as the largest online shopping day in U.S. history. And a September 2021 survey from BlackFriday.com indicates online shopping participation on Cyber Monday is expected to slightly rise from 59% of holiday shoppers in 2020 to 61% in 2021.
It is understandable that some retailers may wonder if Cyber Monday is still a big deal. But in all likelihood, it is.