Interesting indeed to hear from Andy Street of John Lewis that Black Friday isn’t all it has been cracked up to be. Like other trading trends imported from the USA – where it is timed to form part of the Thankgiving holiday – there are as many cons as there are pros in Black Friday activity in the UK. For one, the disgusting scenes of consumers coming to blows in the scramble for discounted TV sets in retail stores around the country on Black Friday, traumatising the retail staff who had to deal with it. For two, the watering down of profits as retailers compelled to join the party flooded the market with special offers and discounts – at time of year when, frankly, demand will be high anyway.
Understandably, online operations creaked under the strain of the massive demand which far outstripped anything that had been forecast. Large players like M&S were forced to scale back their delivery promises as courier firms lacked the capacity and the ability to manage the increased volume from online retailers. For many retailers the BF discounting consolidated a lot of the trading they would have done over the run-up weeks to Christmas, placing an inordinate strain on their systems and their people, and causing countless customer service issues. The burning question is – did it make fiscal sense? Did it enable retailers to offload and clear overstocks or did it simply force retailers to slash their margins to score early sales? The old tenet “turnover is vanity, profit is sanity” rings ever true.
Should British retailers be suckered into “events” like Black Friday or should they instead develop their own discount “events” at a time of year which could use the additional demand? Is not a business on the scale of John Lewis able to lead a move to develop a new calendar of Big Sale events that spread the trade into quieter times of year?
As Andy Street so wisely said “My personal hope is that this (2014) is the highwater mark for Black Friday. I don’t think we can put the genie back in the bottle but do we need to stoke that fire anymore? I personally hope not. ” This from the leader of a multichannel retailer which saw its BF sales rise 22 per cent on BF 2013 and which posted sales of £777 million in the five weeks to 27 December in which retail sales were disappointing but online sales were up by 19 per cent with Click & Collect becoming the chosen fulfilment option for 56 per cent of online sales.
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