Black Friday and Cyber Monday - Do they live up to the hype?
Love it or hate it, Black Friday is here to stay!
We're going to have to face it Black Friday and Cyber Monday are both here to stay, at least until the next big shopping trend comes along. Things have rapidly moved along now since Amazon introduced the idea from the U.S. several years ago, with both the complexity and awareness of the 'hot deal' events increasing hugely amongst shoppers.
The problem with both days is that for retailers and shoppers, the actual point of the events are beginning to look quite dodgy. Apart from the frenzied 'riots' that take place in stores across the country making life a hellish experience for in-store customers, many retail experts are warning that the sales events drain margin for traders, and that actually many of the 'deals' offered to consumers are not really any good at all.
We can argue that there are lots of reasons as to why a 'lightning-rod' style event, designed to attract huge quantities of customer orders to pre-empt the Christmas rush are a generally good idea. Especially as according to Mastercard 70% of expenditure in the U.S. takes place in the first two stores that people visit offline - whether this translates online in the UK is anyone's guess, but it is worth noting. Backing this up is the Georgetown Institute for Consumer Research's data suggesting "that the average adult spends 50.7% of his or her allotted gift budget during this sales blitz" in the U.S. The problem is that like most things of this nature, it's too often only those traders and retailers with the scale, infrastructure and budget to actually leverage these events that really stand to benefit by achieving cross-sells and up-sells. Even big traders suffer from these events as they just don't really know what to expect because it is so new - with some major high-street names feeling the margin 'pinch' and others just running out of capacity to cope.
Great deals can be obtained on Black Friday and Cyber Monday. But it is really the savviest and most astute shoppers that will truly benefit - and when time, peer pressure, a hype-charged marketing zeitgeist, and 'FOMO' (Fear Of Missing Out) kick in, even the most sensible shoppers can sometimes be drawn in to the sales-powered shopping meat-grinder. Good traders and retailers however can ensure that customers not only get a solid deal, but that their business also comes out profitably from the whole venture.
I asked Simon Brereton, Operations Director of 365games.co.uk, a successful e-commerce media and merchandise retailing operator here in the UK a few questions about what he thought of Black Friday and Cyber Monday
Are Black Friday and Cyber Monday relevant to your business?
"At 365games.co.uk we specialise in retailing and distributing entertainment media and associated merchandise. This means our products - especially games consoles and other high value tech items - are hugely in the crosshairs of bargain-seeking Black Friday and Cyber Monday shoppers."
What impact has Black Friday and Cyber Monday had on sales for your business?
"From a business perspective we're very keen to attract shoppers on these two special days, so that we can retain their loyalty and custom through to the Christmas and January sales periods. The Black Friday and Cyber Monday effect has basically 'lengthened' the peak period of lucrative customer contact that we enjoy. Since these events came over to the UK a few years ago, we didn't see much of a sales impact until 2014, when there was a large bump in traffic and sales online - we're expecting an even bigger bump this year."
How have you coped with the extreme operational demands that Black Friday and Cyber Monday place upon your business?
"We've coped through good planning and solid collaboration. We ensure our fulfilment team is well-staffed when required, and that we have all of the stock and equipment in the right places when needed. One of key factors that helped us stay efficient and profitable in fulfilment was the collaboration we had with Lil Packaging. We increased package fulfilment speed by a factor of five, whilst maintaining our high quality of distribution using their knowledge and products for our packaging - this is just one of many ways that we have 'tweaked' our business model to cope with the massive boost in demand we're expecting in 2015 from Black Friday and Cyber Monday."
Do these special sales days live up to the hype?
"Inevitably I think not, because the hype is always blown wildly out of proportion in the media and elsewhere. But like any other commercially important day on the calendar, it's a great opportunity for retailers and customers to get together and negotiate a little more aggressively in their transactions."
What do you think about Black Friday and Cyber Monday? Is YOUR business doing anything special to take advantage of these special sales days? Are you coping well enough at keeping pace with orders?