Black Friday shopping in stores across the United States, both physical and digital, has reported a 28% drop, in comparison with the pre-pandemic numbers.
The 2021 Black Friday has not been, at least in the United States, as profitable as it was expected. Many brands and shops, both physical and online, have reported sales well under the numbers of pre-Covid times. We are talking about, roughly a 28% to 30% decrease from their “natural” sales during Black Friday.
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The report was presented by CNBC and it crunches numbers obtained by Sensormatic Solutions and Adobe Analytics.
According to the report, physical presence also dropped: brick-and-mortar retail stores lost the battle against the online stores, as Americans shifted more of their spending online and kicked off their shopping earlier in the year, according to preliminary data from Sensormatic Solutions.
Traffic was up 47.5% compared with year-ago levels, Sensormatic said. This time in 2020, many shoppers stayed at home due to fears around the coronavirus pandemic and as retailers operated on somewhat reduced hours.
E-commerce sales reached $8.9 billion on Black Friday, although these numbers are still well below the 2020 levels of $9 billion. The $8.9 billion was close to the worst-case scenario predicted by Adobe and also came after disappointing flatline sales of $5.1 billion on Thanksgiving Day — marking the first time in nearly 30 years that both days failed to boost year-over-year spending.
The sales indicate "another sign that consumers started to shift their spending to earlier in the season, responding to promotions and deals from retailers that started in October," Adobe said.
“It’s clear shoppers are shopping earlier this season, just as they did last season,” said Brian Field, senior director of global retail consulting at Sensormatic. He added that the two main reasons shoppers are spreading out their holiday purchases are ongoing concerns about Covid and worries about the supply chain.
The Buy-now-pay-later (BNPL) services like Klarna and Afterpay have had a hell of a year - they were propelled during early 2020 when credit reached its highest levels in a decade - and in recent months several major retailers have opted to integrate the option into point-of-sales both in-store and online.
Thanks in part to its newfound ubiquity, BNPL usage is on the rise this holiday season: According to Adobe, total BNPL spending and volume of orders in November is up 422% and 438%, respectively, from 2019 levels.
Mobile shopping comprised 44.4% of online sales on Black Friday, an increase of 10.6% year-over-year, according to Adobe.
However, a majority of consumers prefer to browse deals on their phone before making purchases on desktop, with smartphone visits accounting for 62.2% share compared to desktop, an increase of 2.2% from 2020, the data shows.
This sharp drop in the expected sales during Black Friday will, no doubt about it, produce a heavy impact on the finances of many companies that betted on this holiday to pick up the pace - sales-wise - from a really slow year.
It also highlights a future problem for all holiday promotions and sales: under an online environment where sales and promotions are battled globally - for example, Steam, Microsoft, Epic Games, and Amazon have been launching for the past years promotions for the Lunar New Year - your holiday sales might crash with some other people holiday sales, or could be rendered ineffective due to your potential customers spending their money - or saving it - for other holiday sales that happen through the year.
Bottom line, when you have “many Black Fridays” spread across the year, none of them is truly appealing.
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