Black Friday is Dead! Long Live Black Friday
The year 2020 has been a bumpy road. For those in online retail, this road is now passing through the holiday shopping season, and at least for this year, 2020 will be altering the primary shopping days, perhaps for this year only, perhaps forever. As Merchants look to approaching November and December, the PMA Deals and Coupons council takes a look at the landscape and provides some recommendations.
Will Black Friday and Cyber Monday basically be the same day now?
2020 has certainly been a year like no other, with retailers seeing unprecedented sales declines and increases due to the Covid-19 pandemic. Given the uncertainty over the last 6 months and the pending holiday season, many retailers are contemplating what the holiday season will look like this year to determine how they can best prepare for the unknown. One topic that continues to arise is anticipated Black Friday performance, given the state of in store shopping, specifically with regard to the limited number of open stores and restrictions on the number of people allowed in store. The question then becomes ‘will retailers and consumers alike shift more focus to online shopping, blending the otherwise distinct holidays of Black Friday and Cyber Monday?’
According to eMarketer, “US ecommerce sales will surge 18.0% to $709.78 billion, while brick-and-mortar retail sales will experience a historically significant decline of 14.0% to $4.184 trillion.” eMarketer also expects “ecommerce will reach an all-time high of 14.5% of all retail sales in 2020.” Given this prediction, many expect consumers to change their behavior, shopping online instead of in store. Other sources indicate that not only will retailers shift their focus to offering the best online deals, but promotions will start earlier and last longer, as opposed to the otherwise most aggressive deals lasting one day only as in previous years.
Retailers like Home Depot have announced plans to offer Black Friday promotions and deals for extended time periods, up to 2 months potentially. Additionally, according to USA Today, Sam’s Club is the latest big box retailer to shift their approach for the peak season. Instead of the historically aggressive one day sales, they will be offering discounts lasting 9 days to combat the Covid 19 pandemic. The Black Friday sale will also last 10 days this year, merging through and past Cyber Monday. Other household brands have also indicated they will tout deals earlier this season including Walmart, Target, Home Depot, Best Buy and Bed Bath and Beyond.
What Holiday Shopping Days are most Important in 2020?
With Amazon kicking off the holiday shopping season early, most predictions are that shopping days this holiday season will be more dispersed than ever before. Shoppers will be looking to Retailer-specific holidays and likely will be subjected to a hailstorm of deals for the next 6 weeks. If Retailers communicate with their most loyal shoppers, our prediction is that those retailers will drive shopper-intent by creating their own promotions, and those don’t have to just be on Black Friday or Singles Day.
Nevertheless, for those married to the traditional shopping days, it’s highly recommended that all retailers bring their best deals to Black Friday, Cyber Monday, Singles Day and Hanukkah.
Brick and Mortar vs Online – how to structure deals that capture the most sales
Six in 10 U.S. adults will use digital coupons this year (pymnts.com). With record levels of unemployment, a Covid-altered landscape has made deal-hunting more important than ever. Retailers don’t want to be absent in offering holiday deals to frugal shoppers this season.
Deals of any type will be welcome (and expected) by a crowd of online holiday shoppers that expect, despite a Covid-economy, to spend as much for the holidays in 2020 as 2019.
The majority of retailer discounts will be either product specific or sitewide discounts along with free shipping. But Shopify recommends that retailers test multiple methods of customer promotions including:
- Free Gift with Purchase
- New Customer Discount
- Tiered Discount by Spending Level
- Timed Discounts
How do smaller merchants compete with Amazon, Walmart and Target?
This year, Amazon and Walmart almost completely withdrew from the Affiliate Channel. This led to serious disruption amongst thousands of influential publishers who relied on Amazon commissions in their business. Out in the landscape are many motivated affiliates with strong communities, waiting to engage with great retailers. This is the best time in years for retailers to engage with big publishers. (fool.com)
Paid placements, sales minimums and other affiliate fees to expect
Paid placements in the Affiliate publisher landscape are more commonplace than ever. Expect placement fees from most sites, although with Amazon and others drastically reducing their affiliate footprint, know that Retailers should have a better negotiating position on fees. Retailers should also factor into their spend other fees such as integration fees and sales minimums on major affiliate websites, and placement fees on major content sites.
Click and Collect Catches Fire
Among the biggest trends this year is the phenomenon of “Click and Collect”. “Click and Collect” is where you buy online and head to a physical location where your item is loaded in your car. Grocery stores appear to have started this trend, but a recent Google survey found 47% of shoppers said they’ll use click-and-collect services moving forward. Retailers are encouraged to embrace these new shopping habits where applicable.
Recommendations for Merchants this Q4
- Start your deals early – 3 in 10 consumers say they expect to start their holiday shopping earlier than usual this year (CNBC)
- Hedge your bets against disruption – many customers are shopping earlier due to the fear of shipping delays by customers and retailers. (Reuters)
- Negotiate paid placements – use the leverage from key departures in the affiliate landscape
- Drop multiple promotions, and don’t feel the need to only bring those promotions to Black Friday and Cyber Monday
- Get your mobile and social game ready – 37% of US adults in the Salesforce survey said they were more interested in mobile app shopping than they were last year; 22% said the same about shopping via social media. (emarketer)
- Be ready – According to May 2020 data from daVinci Payments, 71% of US adults said they planned to do more than half of their holiday shopping digitally this year. So be in stock and ready to fulfill heavy volumes! (emarketer)
- Embrace new shopping and research habits like click-and-collect
- eGift Cards and last minute shopping needs to be embraced
- Integrate smart-targeting tech (PartnerCentric)
- FMTC functionality for curbside pickup:
- Publisher Code Freezes – check with your network or largest affiliates for any relevant code freezes
- Black Friday Store Closures