A Black Warning for Black Friday – Beware Reputational Damage
Retailers across South Africa are bracing themselves for a frenzied rush to their stores on Friday for the so-called Black Friday discount bonanza. They are unpacking additional stock, hiring extra staff and security in anticipation of a buying mob descending from the early hours.
Many franchises in the retail space will be following suit, but franchisees need to be careful that it doesn’t result in future scepticism and a business hangover.
This could come about for two reasons. Black Friday is a cash cow for local retailers. BankservAfrica recorded R2.5-billion worth of transactions on Black Friday last year. The 4.7 million card transactions that it cleared on the Friday were double the daily average. This could leave people in debt.
Secondly. A recently released report in the UK, a Which? Investigation, found that the majority of products sold on Black Friday could be bought at a lower price in the months before and after the event. Consumers have been alerted to this.
It’s not really cheaper
Nearly nine out of 10 of last year’s Black Friday ‘deals’ were cheaper or the same price at other times in 2017, the investigation found. The consumer body Which? checked the prices of 94 popular products including TVs, cameras and fitness trackers, and is warning shoppers to do their research before hitting the sales.
The investigation looked at offers at top retailers and featured 59 deals at Currys PC World, 18 deals at Amazon, 14 deals at John Lewis and three from Argos. Which? tracked the price of items from six months before until six months after Black Friday 2017, and found that 87% of the products were cheaper outside of the sales event which fell on Friday 24 November.
Forewarned, this year consumers may well be more cautious in what they buy, and any franchise participating in such socially dishonest behaviour may risk damaging the brand’s reputation over the longer term.
Alex Neill, managing director of home products and services at Which?, is reported in The Daily Mail as saying: “The results of our investigation will disappoint many who are expecting nothing but bargains this Black Friday.” He urged consumers to do their research.
In South Africa, such is the interest around Black Friday that some stores, such as Game and Makro, are running Black Friday over five days.
Locally, a PricewaterhouseCooper spokesperson also warned consumers to make rational decisions, noting that a form of auction-mania (when people lose all rational thinking ability and will bid far in excess of what the product is worth – just to ‘win’) could come into play in the mass hysteria.
Black Friday encourages shoppers to flock to the high street and pick up bargains, having started out in the US where it is marked on the Friday after Thanksgiving. Shops there drop prices to start the Christmas season and because many people are off work. The sales event spread around the world in the years between 2010 and 2013.