Black Friday 2017—Shopper Secrets UnwrappedNovember 3, 2017
and the family has gone home—where are you? Ten years ago, your answer might have been “getting ready to grab a spot in line for the best Black Friday deals.” But if you’re like a growing number of shoppers, your answer today is more likely to be on your computer or mobile device, snatching up early Black Friday deals online from the comfort of your couch.
During the 2016 holiday season, the National Retail Federation (NRF) found that most shoppers (44 percent) went online for Black Friday and other Thanksgiving weekend deals versus shopping in-store (40 percent). At the same time, while overall holiday spending rose by 4 percent for the year, spending on Black Friday weekend was down slightly—$289.19 per person versus $299.60 in 2015.
All this begs the question—is Black Friday really as important today as it was in years past? In the age of constant price wars and faux shopping holidays like Amazon’s mid-year “Prime Day”—what do retailers really gain from opening their doors earlier and earlier on Thanksgiving or slashing prices to razor-thin margins on Black Friday? What happens if they opt-out?
To find out where today’s shoppers stand, we surveyed 500 real consumers on their plans for Black Friday, Cyber Monday and holiday shopping overall. Here’s a look at our top trends taking shape and ways retailers and brands can respond.
#1 – Opening stores on Thanksgiving is a gamble.
Only 28 percent of shoppers surveyed said they would happily go to a retailer who opens its stores on Thanksgiving Day. In contrast, 40 percent of shoppers say they avoid such retailers based on principle, and another 32 percent say that while they may still go, opening on Thanksgiving isn’t ideal.
These findings are consistent with the trends other retail industry experts have been seeing over the last couple of years. For example, according to the NRF, in 2016, early in-store shopping on Thanksgiving Day dropped by 19 percent compared to 2015, with only 7 percent of consumers heading to stores before 5 p.m.
“It’s been about eight years since Walmart started this trend of opening their stores on Thanksgiving Day. Then everyone jumped on it,” recalls Ana Serafin Smith, Senior Director of Media Relations for the NRF. But after a few years of analyzing the results, some retailers found it wasn’t in the best interest of their business or their customers to open on Thanksgiving, she explains. Hence the recent rise in big name retailers like Nordstrom and REI taking a stand against opening on Thanksgiving.
“But a big piece to keep in mind is that even though their brick-and-mortar stores aren’t open on Thanksgiving, their online stores are up and running,” Serafin Smith points out. “Even for retailers who are closing their stores [on Thanksgiving Day], we’re seeing special sales online. That keeps them part of the conversation.”
Findings from retail intelligence firm PlanetRetail RNG echo this. “Last year we ranked popular shopping days by holiday shopping volume and saw that Thanksgiving wasn’t even in the top 10 for store-based sales, but it was in the top five for online sales,” says Ioli Macridi, PlanetRetail RNG Research Analyst.
Macridi goes on to explain that by shifting their focus for Thanksgiving Day online, retailers can save on costs, and may even get a bit of a brand boost by showing they are sensitive to their employees in allowing them to spend that time with their family.
#2 – Getting shoppers into stores on Black Friday isn’t a slam dunk for sales.
While 88 percent of consumers surveyed have shopped on Black Friday in the past, only 55 percent said they definitely plan to do it again this year. Nearly a third (28 percent) said they were still undecided. What’s more only about half of shoppers said they’re willing to brave large crowds and stand in long lines (typical occurrences at many retailers) to get the best Black Friday deals.
“This is a case of less is more,” says Ryan Dee, Creative Director for Daymon’s consumer experience marketing team. “The longer the Black Friday shopping period extends, the smaller the crowds are becoming. With deals and exclusives spread out from Thursday through the weekend, there is no sense of urgency to shop on Black Friday any longer.”
“Black Friday shopping has become as much about the competition and experience of shopping as about getting the best deals,” agrees Daymon CEO Jim Holbrook. “Rather than watching football, families might go out shopping instead. So it becomes a question for the retailer—how can you make it worth it for shoppers to come to your stores?”
For Holbrook, one of the best ideas is incorporating “retail-tainment” into Black Friday. This could include things like having live music in the store, hosting cooking classes for Thanksgiving leftovers or having Santa Claus hand out candy to children. “There are lots of ways to add some attractiveness to the shopping experience,” says Holbrook. “I think that’s how Black Friday is going to evolve. It’s going to become less about deep discount and more about the experience of shopping and shopping as entertainment.”
#3 – To win in the online game, you must build trust.
While 59 percent of shoppers surveyed said they would visit unfamiliar sites for Cyber Monday discounts and promotions, only 34 percent said they would actually be willing to provide their credit card information to such a site.
This might not be an issue for well-known, national retailers who have already built a strong reputation of trust with their shoppers. But for lesser-known retailers who are trying to build up their e-commerce presence, this can present a serious challenge, not just for Cyber Monday, but for the whole Thanksgiving shopping weekend.
“Last year was the first year that online holiday shopping surpassed brick-and-mortar, and there are a lot of predictions that trend will continue,” says Rekha Ramesh, Senior Vice President of IT and Digital for Daymon. The problem for smaller retailers, she explains, is that so many have been targeted for cybercrime, consumers have developed a healthy dose of skepticism when it comes to unknown websites.
But there are ways retailers of all sizes can help build trust with online shoppers. “It starts with securing your website,” says Ramesh. “Even small businesses can easily secure themselves. It’s no longer a big ticket price to use SSL [Secure Sockets Layer] or even to go one step further and encrypt your SSL with what’s called ECC [Elliptic Curve Cryptography]. And retailers should secure all pages with what’s called Always-On SSL, not just the first one or two. Consumers are more savvy now and they’re looking for that green lock symbol on every page they visit.”
Ramesh says retailers can also encourage consumer confidence by employing recognized payment platforms such as PayPal or Visa Checkout. “These are things that don’t cost that much and they help the consumer realize you are taking security seriously, which encourages them to proceed with the purchase.”
Beyond the nuts and bolts of security, Ramesh says retailers also need to pay attention to the experience they’re offering consumers online. Smaller retailers may need to go a step beyond offering a good deal to entice shoppers to choose their website over another. “Research shows that consumers are not only buying gifts on Black Friday, but also spending on technology and vacations for themselves and their families. As a small retailer, you could capitalize on this behavior by offering a contest or promotion that incorporates these things—like buy $1,000 worth of merchandise and get a free tablet—to attract more shoppers.”
Even for retailers who don’t find the “Cyber Five” to be a big weekend for online selling, Holbrook says there’s still an e-commerce play to be made. “Grocery retailers can offer a service or a benefit [that helps build the customer relationship], like offering last-minute trouble-shooting tips on their website on Thanksgiving, or recipes for leftovers and a holiday shopping list on Black Friday. Any way a retailer can offer shoppers a way to save time or money—those are the two biggest things people are looking for.”
The Bottom Line
While the buzz around Black Friday (and Thanksgiving weekend shopping in general) isn’t likely to go away anytime soon, all signs point to the fact that it is changing. Retailers and brands can’t simply rely on the same tactics they’ve always used and expect to have continued success.
“The same way our industry is transforming, so is Thanksgiving weekend,” says Serafin Smith. “The best players will continue to innovate and those who can’t or don’t, won’t continue to be here. Retailers have to keep up with what customers want, how they want it and when they want it. If you’re not following that, you’re going to fall to the sidelines.”
Headed Online this Holiday Shopping Season?
Here are four ways Daymon Senior Vice President of IT and Digital Rekha Ramesh says you can protect yourself:
- Look for “https” at the start of the URL and a green lock symbol in the address bar of your web browser. These features show that a site is secure.
- As you go through the site, check to see those security features continue on all pages.
- When it comes to payment, if a site offers recognized platforms like PayPal or Visa Checkout, go for those things. If you have to use your credit card, make sure they are asking for your CID or CVV number.
- For extra protection, consider signing up for one-time-use payments through your credit card. These services generate a temporary “virtual” credit card number that can only be used online and for a limited time and/or amount.