So what’s this event really about? Where did it spring from and why has it taken off?
Black Friday was the term coined by the Philadelphia police to describe the day after Thanksgiving “when hordes of suburban shoppers and tourists flooded into the city in advance of the big Army-Navy football game held on that Saturday every year. Not only would Philly cops not be able to take the day off, but they would have to work extra-long shifts dealing with the additional crowds and traffic. Shoplifters would also take advantage of the bedlam in stores to make off with merchandise, adding to the law enforcement headache.” 1
It wasn’t until the late 80’s that the event went nationwide and indicated the day that retailers went from the red (making a loss) to black (making a profit). In the US it has now become a four day event with many states giving the Friday as an unofficial holiday and it marks the beginning of the Christmas Shopping season. In retailing terms this equates to our Christmas sales beginning on St Stephen’s Day.
So what about Black Friday in Ireland?
Black Friday was imported here in 2008 after it had crossed the pond to the UK via Asda (owned by the US behemoth Walmart). By now consumers were accustomed to annual footage from the US of fist fights over wide screen TV’s and stampedes as soon as big box retailers’ doors opened. Whilst Black Friday might be attractive for the consumer, is it good for the retailer?
Just think about it for a minute. Most retailers depend on the Christmas season for at least 25% – 30% of their annual turnover, and also the time when they can make full margin on their sales. This makes up for the margin lost by poor buying decisions or overstocks. Poor retailers! My heart bleeds! But at a time when costs are ever increasing, rent and rates are climbing disproportionately year on year and competition is coming at you from every direction, the Christmas season should be the time to make some money to compensate for some of those factors.
And then Black Friday comes along! To keep up with the retailing Joneses you have to cut prices at the beginning of the Christmas season – is this madness? The savvy retailer will offer selective discounts on high margin goods or on stuff they can’t shift at full price. However the ante is upped by the big names who now have a Black Friday week!
So how was it for you this year?
As reported in the Irish Times, Ella De Guzman, who owns the four Siopa Ella stores dotted across Temple Bar and Wicklow Street, says the Black Friday sales are “not ideal” for smaller businesses. “Everyone expects you to compete with the big bucks but we can’t take 50 per cent off everything. For smaller businesses it’s very hard because their margins are already small enough.” 2 The TV cameras outside Curry’s PC World on Oxford Street recorded one lone shopper arriving when the store opened at 7am. The bemused customer was there to pick up a pre ordered laptop with no Black Friday discounts.
In the US in recent years Black Friday has fallen out of favour somewhat because of a growing awareness of the pressure it places on minimum-wage retail workers to work on Thanksgiving Day as well as a backlash against consumerism the day after a national holiday celebrating gratitude! Since 2015 the US outdoor clothing giant REI announced that it would not mark Black Friday with a sale, instead giving their staff a paid holiday. The brand is trying to “create a new tradition” encouraging customers and staff to skip the Black Friday frenzy and spend time outdoors instead. And of course, there’s a social media strategy behind it with customers and staff sharing images on social media with the hashtag #OptOutside. 3
Black Friday is here to stay, for now at least, but maybe has lost that edge of earlier years. Some retailers gave very limited offers or a discount on delivery by online retailers. As for the consumer, buyer beware as warned by Conor Pope in the Irish Times podcast, Does Black Friday Add Up. 4
Happy Christmas Retailing!
1 http://www.history.com/news/whats-the-real-history-of-black-friday
3 https://www.rei.com/opt-outside
4 https://soundcloud.com/irishtimes-business/does-black-friday-add-up-hammonds-safety-first-uk-budget
