Holiday promotions are a necessary evil, but they form a Retail Death Star when shoppers expect deep discounts and leave brands to perish when they don’t get them.
As attention shifts from summer to back-to-school, the retail journey into falling prices begins. Labor Day sales, ghoulish Halloween savings, and the extravaganza of Black Friday and Cyber Monday. The question that looms is whether consumers will spend as usual, or will the retail traditions and tactics of years gone by fade as a result of the changes we’ve experienced through COVID-19?Will people set their alarms and head out before the first light, or will they stay closer to home and try code after code in the promo window? What are the Black Friday 2021 trends retailers should watch?
Last year, COVID drove e-commerce growth through the roof, a trend that carried through the holiday shopping season. Experts expect e-commerce to continue its upward trajectory this year despite a recovering economy and reopened stores. Retailers should expect online shopping trends that grew during the year+ of quarantines, lockdowns, and social distancing to continue, including:
- Demand for buy now, pay later options
- Free shipping
- Buying local
- An extended holiday shopping season
Black Friday 2021: What will consumers do this year?The term Black Friday comes from the days of bookkeeping in ledgers and the point in the year at which the ink went from red (at a loss) to black (at a profit) was around this time of year. Retailers learned that they could achieve their numbers through strategically timed sales.
Black Friday has been a time when people either stock up or spend big. The Nintendo Switch was near the top of the list of most searched items for Black Friday for the last two years. Other contenders were Apple Watches and Air Pods. Televisions are another highly sought-after item.
Whether shoppers head out to stores for traditional “door buster” Black Friday sales like big-screen TVs remains to be seen.
“Before news about the a COVID variant, it looked like people were anxious to get back out into stores and back to normal. So we’ll see how the variant plays out on Black Friday… Consumers do seem to be ready to spend, again. People are getting back to work, the job market is kind of booming again. So on that end, it looks great. But I do expect a lot of people to still be relying on online shopping instead of going out at midnight,” says Gabrielle Pastorek, Retail Analyst at Finder.com.
Holiday shoppers want payment options
As Black Friday 2021 shoppers scour the web for deals, they’re also taking a close look at retailers’ payment and shipping options.
Buy now, pay later services are a huge trend that’s continuing to grow, Pastorek says. “It’s essentially a modern-day layaway, but you get your item before you pay for it,” she said.These services have become increasingly popular during COVID, when many consumers dealt with tight budgets. Providers of buy now, pay later services include Klarna and Affirm, which recently inked a deal with Amazon.
Retailers can’t compete without having a buy now, pay later option, Pastorek says.
Another must-have for retailers: Free shipping options. Shoppers have become accustomed to getting their purchases shipped free-of-charge, whether that’s through Amazon Prime or a retailer that offers free shipping above a threshold purchase amount.
Something retailers and consumers will need to keep in mind this holiday shopping season: The US Postal Service plans to add a surcharge to packages shipped between Oct. 3 and Dec. 26. The charges, which could range between an extra quarter to $5, applies to anyone shipping, whether an individual or a company.
USPS applied the surcharge to commercial shipments during the 2020 holiday shopping season; UPS and FedEx also added surcharges.
Another blow for retailers arrived on Cyber Monday: As all e-commerce shopping records are smashed, UPS limited shipping for big brands in an effort to keep up with the overwhelming demand.
Keeping it localMore and more consumers are becoming selective about where their purchases are sourced. They want to support local, small businesses rather than always feeding the megastores and online giants like Amazon.
Along with supporting local businesses, a growing number of consumers are looking for sustainability. They don’t products shipped from distant sources and prefer reusable products or ones made with sustainable materials. Healthy food and beauty products have become priorities for many consumers.
Given the option of a product made in the USA versus one that’s not, some shoppers will choose the USA-source item, Pastorek says. Since those products can cost more, she advises retailers branching into sustainability to start small, perhaps with clothing, where the surcharge can be something consumers will accept.
If offering domestic products is out of reach for a retailer, another option for attracting buyers is promoting a sustainable corporate culture, she says.
In 2021, Black Friday morphs into Cyber Monday
With so many holiday shoppers going online, the traditional line between Black Friday and Cyber Monday sales have blurred. This trend has been growing for a while now, as retailers started offering Black Friday deals well before the customary day after Thanksgiving. Cyber Monday deals also are popping up earlier.“We’re definitely seeing Black Friday get stretched longer and longer,” Pastorek says. “It’s almost like the few weeks before Black Friday, and then the few weeks after Cyber Monday are all just being mashed into one big sale.”
No matter what, consumers are always going to find ways to engage in retail-whether it’s a bit of retail therapy, pantry-stocking, or a tradition they identify with the holiday season.
Black Friday is often used as a barometer for what retailers can expect for the rest of the year. It’s important to get it right, from marketing and inventory to having the right sales associates to cater to customers. Stores and brands need to be prepared to adapt to the changing tide of consumer preferences.