Did Black Friday 2020 give us a glimpse into the future of retail?

Online shoppers in the US spent around $9bn on Black Friday this year. This number represents a 22% increase from 2019 and it also makes Black Friday 2020 the second-largest online spending day in history, Adobe Analytics reports. Meanwhile, in-store visits plunged 52%. In South Africa, the numbers looked similar. Black Friday accelerated online transactions by 50% compared to 2019 and visits to shopping malls were 13% lower than on Black Friday 2019, according to data from South African payment solution, PayFast.

But this trend isn't entirely new. In recent years, e-commerce has been on the up as many consumers favour online shopping over visits to physical stores. And with global lockdowns due to the coronavirus restricting the public's movements, many consumers chose to observe social distancing regulations by shopping online, says Jonathan Smit, MD and founder of PayFast.

The pandemic saw retailers spending much of 2020 improving their digital channels so that they could offer better user experiences for shoppers. "This Black Friday offered a more considered and improved customer experience across the board," says Smit, reiterating that worldwide lockdown restrictions served as a test bed for e-commerce businesses to use the lessons they've learned to shape their future strategies. The pandemic has also brought about a rise in shopping innovation. For example, curbside pickups and click and collect options gained popularity this year as retailers looked to bridge the gap between shopping online and in-store.

A glimpse into the future of retail?

This shift in consumer behaviour represents a watershed moment for retailers. Going forward, retailers must rethink their approach if they want to hold onto their customers and outdo their competitors. For example, a look at worldwide Google search trends reveals that searches for Black Friday started gaining momentum from as early as September. And the volume of searches for Black Friday escalated rapidly as the holiday drew closer. MediaPost reveals that searches for Black Friday increased by 388% from September into October.

So, what does this mean for retailers?

Steve Sadove, former chairman and CEO of Saks, believes that the trend calls for a change in the retail promotional calendar and demands that retailers extend the Black Friday shopping season beyond a single day or weekend. This is something that many retailers have been trying to do for years, adds Sadove.

But one must remember that retailers also need shoppers to buy products that aren't on sale. Online shoppers tend to do a lot more research and only cherry-pick the deals that they think offer the most value, continues Bill Simon, former Walmart US president and CEO. If you just sell the deals, you're going to lose money, he notes "You've got to sell the wrapping paper and the Christmas lights and the candy canes and everything else that goes with it or you're just not going to make it."

Ultimately, it comes down to providing a positive experience for all kinds of consumers. Some relish the opportunity to get out of the house and shop. Others prefer to shop without having to leave their homes and could think of nothing worse than navigating busy shopping malls to secure a discount. Now is a great time to assess what worked and what didn't work and then adjust retail strategies accordingly. One of the major takeaways from Black Friday this year is that retail brands need to offer the best of both worlds. By providing an omnichannel experience, retailers give consumers the option to shop when and where they need to - be it in-person, online or both.

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