Like many American imports, Black Friday made a huge impact when it hit British shores in 2014.
And like Netflix, Krispy Kreme and trick-or-treating before it, the phenomenon has reconfigured the industries it touches.
Despite last year being a more sedate affair than 2014, where the last memory was people fighting over cut-price TVs, it was actually more popular with consumers.
According to Verdict Retail research, 44.3% of British consumers made a purchase on either Black Friday or Cyber Monday last year.
With headline figures like that, it’s easy to assume that Black Friday is a must-do event for all retailers. But in truth, that’s utterly dependent on sector.
Amazon, another US import that’s transformed retail, was the first to bring Black Friday to the UK, a fact that’s still evident.
Of the 44% of shoppers who indulged in Black Friday last year, 81% made electrical or technology purchases – two of Amazon’s strongest categories.
Richard Talks Retail analyst Richard Hyman says: “The areas where Amazon is the biggest is, broadly, where Black Friday is biggest. If you’re selling durables or electrical products and you’re up against Amazon, it’s not your decision to discount. You can’t not do it.”
But Retail Remedy managing partner Phil Dorrell has a more optimistic view.
“Electrical retailers can really benefit from Black Friday,” he says. “And mixed non-food operators like Argos and Shop Direct can also benefit massively, even more than electrical pureplays perhaps. Electrical deals can entice people in but furniture and toy deals mean they have a broader appeal.”
There is one sector however which everyone agrees is incompatible with Black Friday – fashion.
“Fashion retail is the loser here,” Dorrell continues. “If fashion retailers are participating it is because they are being opportunistic and clearing product, especially because of this year’s warm autumn. If they are embracing it, it’s not because they want to – it’s because they have a problem to solve.”
Hyman believes that fashion is the sector which suffers the most at Black Friday because, “in an over-supplied industry, it is the most oversupplied sector”.
He adds: “Managing discounts and managing a promotional calendar in that sector is really, really difficult.”
Verdict Retail associate analyst Zoe Mills points to the spend per item on fashion compared to Black Friday stalwart electricals.
“Black Friday is a great fit for items that have a higher price point that people wouldn’t normally purchase,” she says. “That is why it works so well for electricals. But that’s not how fashion works.
“And so many fashion players are still on promotion at the moment, the week before Black Friday.
If they do choose to discount over the weekend, then how much of an impact will that have?”
Protecting the bottom line
Ultimately, no matter what sector in which a retailer operates there are still multiple pitfalls to navigate.
Last year, two-thirds of those who made a purchase during Black Friday brought forward or delayed a purchase they would have made at another time, according to Verdict Retail.
That leaves just one third who bought on impulse.
While retailers may have boosted their top line, for many, the bottom line is taking a hit.
But Dorrell says retailers can control whether profits are impacted.
“It can be a margin reductive exercise if you don’t plan properly,” he says. “The less clever retailers are thwarted by it. They wish it had never happened. But the good retailers will maintain their margin, even if they don’t like it.”
Retail analysts agree that while Black Friday will not completely disappear anytime soon, the hysteria witnessed in 2014 will not be seen again.
This is, in part, due to its migration online but also because of the discount mentality that consumers have become used to.
“The bulk of the industry has been running promotions all year round,” says Hyman. “The impact is that it becomes like the boy who cried wolf – no one takes any notice.”
All will be watching to see how much notice the shopper takes this week.