• Shoppers set to spend over £10bn during this year’s Black Friday

        • Spend during the Black Friday period, defined as Monday 20-Monday 27 November 2017, is forecast to grow 3.8 per cent on 2016 (Monday 21-Monday 28 November 2016) to £10.1bn, accounting for 10.4 per cent of total Q4 spend. Although growth is forecast to slow year-on-year, Eleanor Parr, Retail Analyst at GlobalData expects more retailers to take part in the event this year in an attempt to stimulate the waning demand they have faced over September and October.

          Electrical sales are expected to continue to dominate Black Friday promotions, although year-on-year growth is forecast to slow to 3.0 per cent, due to inflation in the market discouraging spend.

          While electricals have traditionally been the main focus of the event, over the past two years fashion retailers such as ASOS and Topshop have improved their Black Friday offers, driving spend in this market. Furthermore, health & beauty performed well in 2016, with department stores such as House of Fraser, Selfridges and John Lewis offering strong discounts on branded fragrances and cosmetics. Strong growth is expected in this sector in 2017 if these deals are replicated. 

          Although the smallest proportion of the market, homewares is forecast to experience the strongest year-on-year growth of 5.9 per cent. Poor sales in homewares throughout the year, driven by consumers’ drive to cut down on discretionary purchases, will mean more retailers will feel the need to participate in Black Friday, in an attempt to stimulate demand and sell through slow moving lines.

          Strong inflation in the market means retailers will struggle to offer the low prices seen in 2016. Increased cost prices will mean retailers are unable to offer the level of discounts advertised in 2016, meaning demand may waver as consumers feel less inclined to make bargain purchases on impulse. As a result, retailers will need to be creative with how they advertise Black Friday promotions this year, for example promoting multi-buy offers or free gifts with purchases if they cannot afford to offer large discounts.

          A lower proportion of Black Friday spend will fall on the Friday. When Black Friday was first exported from the US to the UK the event promised impressive discounts for one day only. However, over time retailers have taken the opportunity to extend the event, both to encourage more consumers to participate but also to relieve operational pressures. In 2016, most retailers advertised their Black Friday deals as starting on the Friday and finishing on Cyber Monday, however Amazon took this further advertising a Black Friday sale running for 12 days between 14-25 November and has already highlighted its sale will run for at least 10 days this year.

          Eleanor said, “In 2017 we expect more retailers to extend their promotional calendars to include the whole week before Black Friday in an attempt to stimulate demand as they continue to struggle this quarter. Furthermore, as more retailers advertise their Black Friday deals early, other players will be forced to participate to remain competitive. This is particularly tricky for retailers that price match, such as John Lewis, which will have no choice but to bring down prices early, impacting margins and stock levels. Retailers must prepare by ensuring they have the operational capacities to cope with an influx in trade over a sustained period.”

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