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Is Black Friday Really Beneficial to Retailers?
November 2015 - Black Friday is only two weeks away. Known in the industry as the biggest shopping day of the year, it is seen to be the day that really kick-starts the Christmas shopping season. But after the frenzy that was Black Friday 2014, is it really beneficial to retailers?
This year Asda have confirmed their plans to step away from Black Friday deals after the promotional commotion in its stores last year failed to deliver profitable sales. Similarly, recent research by Blue Yonder revealed that three quarters of shoppers had a bad experience during last year’s chaos and that retailers need to plan carefully for the upcoming sales bonanza.
Based on these figures, retailers need to recognise that Black Friday is more than just discounting products - it is a huge in-bound opportunity which can create longer term customer loyalty.
Rather than just using it as a chance to shift as much stock as possible, which didn’t in fact generate the desired positive experience, retailers should start looking at providing customers with tailored services or offer additional points or discounts as part of a loyalty scheme. For example, as opposed to just slashing prices, when Black Friday comes, retailers could offer triple points on the day when consumers sign up to their loyalty scheme.
Cutting prices to induce consumers is not a good tactic for businesses that pride themselves on the value of their products. Being viewed as being cheaper, even for a short period, will hurt the long-term brand value and reel in fickle customers who won’t return if they spot a better bargain in the future. Dropping prices can also plant a seed of doubt and accrue distrust over time as customers may start to suspect they have overpaid previously.
Providing customers with a service or a promotion that has a higher perceived value than simply taking 10 per cent off a product is something that can benefit both consumers and retailers in the long term – and potentially evolve the excitement that surrounded Black Friday 2014.
By Ian Horsham, Promotions & Incentives
This article was originally featured Digital Marketing Magazine: http://digitalmarketingmagazine.co.uk/digital-marketing-features/is-black-friday-really-beneficial-to-retailers/2873