Black Friday 2021: Fewer promotions, undimmed consumer appetite

Discount-heavy shopping events like Black Friday exist to spur demand, but in 2021 amid widespread supply chain issues around the world, it’s possible that this year they will serve a very different purpose.

Why it matters

Post-Covid, people are ready to spend and with the memory of a muted Christmas 2020 still fresh in the memory, they appear to be making up for lost time, despite surging inflation with confidence high in both the US and UK. All of which raises questions about what Black Friday is for when the global economic situation shows demand outstripping supply.

Takeaways

• In the late phases of the pandemic that we find ourselves in now, the stampedes of yesteryear appear very noughties.
• Instead, some retailers are finding that by giving employees a rest on Thanksgiving rather than indulge in the long shopping holiday, with Target announcing that it would make the holiday store closure a permanent feature, competition for employees’ as well as customers’ hearts intensifies.
• We know that many shoppers have started much earlier than normal; a National Retail Federation survey showed that respondents had completed 10% more of their Christmas shopping by early November than they had a decade ago.
• Prices are up and discounts are down, Business of Fashion reports, with online outlets, analysed by Salesforce, hiking prices by an average of 12%, while discounts have dropped by 16 percentage points.
• While appetite remains high, especially driven by a return to experiences, the Deloitte holiday retail survey notes that those spending gains are driven by high-income groups. Even with discounting, this could be a tough Christmas for those on lower incomes.

Sourced from FT, Business of Fashion, Wall Street Journal, Deloitte