(qlmbusinessnews.com via news.sky.com– Fri, 25 Nov 2017) London, Uk – –
It’s a shopping event that didn’t even exist here a few years ago but now seems to have turned into a relentless machine.
Look around you today, and witness an outbreak of furtive shopping.
People at work, on the train or maybe sitting opposite you in the living room, all looking at a screen, spending time on spending money.
Today is Black Friday, a retail event that didn’t even exist in this country a few years ago but now seems to have turned into a relentless machine.
In shops and online, we are expected to spend around £3bn over the next few days. Black Friday, after all, doesn’t actually stop until Sunday or Monday.
Yes, it’s a bit gaudy and no, not every retailer joins in.
Marks and Spencer, for instance, have made a point of avoiding this carnival of cost-cutting, but every year, more people do seem to get involved.
Today, you’ll see special deals at stores ranging from Poundland to John Lewis, which rather suggests that Black Friday is here to stay.
But why? Why would retailers decide to embrace all this, offering huge discounts in the run-up to Christmas, traditionally the time when we all dig into our savings for an annual shopping splurge?
Why, to use a rather vivid metaphor, would shops cannibalise their own sales?
To discover the answer, you have to cast your mind back to the financial crisis and then gently scroll forward.
In the years that followed, Britain’s economy was helped by consumer spending.
British shoppers, to put it bluntly, kept on opening their wallets, and Britain’s retailers kept finding things to sell to them.
The competitive nature of that was fierce – just look at food price deflation or the collapse of BHS as evidence of that – but our best retailers are all still there.
Into that pot came tumbling the explosive expansion of online shopping.
The internet delivered three strands: traditional retailers who found a new way of selling goods, pure online companies such as ASOS or Ocado, and then Amazon – a company worth £418bn at last count, but which is younger than Ariana Grande, and sells just about everything, to just about everyone.
British retailers found themselves battling to understand how to combat Amazon, and also how to keep us all spending money.
And then, Black Friday tumbled into their laps, offering an opportunity.
Black Friday was already an American institution, heralding a shopping splurge after Thanksgiving, and it was brought here by Walmart, an American company.
But the Brits have embraced it – retail giants such as Dixons Carphone commission special Black Friday products a year in advance while the list of special deals is long and detailed.
Yes, some of them are things they’re trying to get rid of anyway, and yes, some of them were probably available at a discount price a few months back anyway.
But few now doubt that there are bargains to be had out there.
This is an important Christmas period. Retail sales have been weak over the past few six months and plenty of retailers I speak to paint a picture that is tougher even than official statistics suggest.
Some say their focus is pretty much entirely on survival, rather than growth and they worry that the likes of Amazon are selling products for below-cost, creating prices that are impossible to beat on a regular basis.
Black Friday gives them a chance to grab back our attention.
And curiously, it seems that this doesn’t ruin Christmas sales – only one in five Black Friday sales are Christmas presents.
Mostly, it’s people treating themselves to a bargain purchase, and mostly they’re doing it online.
Only 20% of Black Friday shopping is done in an actual shop.
That’s why you’re going to see so many people studying screens over the next couple of days, adding to the billions that we spend over a weekend.
That leaves other, pressing questions – if more shopping is now being done online, and if young people assume all transactions are done online by default, what are the consequences for physical shops, for delivery companies, automation and retail employment?
These could end up being crucial questions for the UK economy – something to ponder as you wait at the online checkout.
By Adam Parsons