Black Friday is on the horizon, although for many retailers, the deals have already been rolled out, and many consumers are no doubt taking advantage of what has essentially become a 90-day sales event.
However, Black Friday, the singular day, is still much anticipated and is the unofficial start to the festive season. This year, the holidays will, for many, be reminiscent of those of yesteryear, before a global pandemic brought about travel restrictions and gathering limits. Family get-togethers will surely be much larger, and that means consumers this year will have a longer list of people they need to shop for.
According to McKinsey, “55 percent of US respondents say they are excited about holiday shopping, and most people have the savings to spend.” Customers are ready to shop, no doubt, but with a looming recession and inflation at record highs, they are looking for ways to make their money go further, rather than reduce spending. In fact, retailer shave reported that consumers are “making fewer trips to stores, but bundling purchases and spending more money per trip.”
For the consumers looking to get the best value, this will mean looking towards private label brands for everyday items, like the fixings for holiday meals.
When it comes to gift shopping, consumers will remain loyal only to the price tag, with “nearly half of US survey respondents [McKinsey] say[ing] they would switch stores if they found a better price elsewhere.” This could mean swapping Best Buy for Walmart or purchasing Apple products from Costco, rather than Apple directly, to help maximize savings.
This is good news for some retailers, namely those that traditionally deliver the lowest prices but less encouraging for those that do not. As such, retailers that don’t have the lowest prices will feel the pressure, more so than usual, to compete with the lower-priced options.
In cases where that isn’t possible to match or reduce pricing, retail brands will need to focus on the unique value they provide over their competitors and ensure consumers feel it is significant enough not to make the switch.
That’s what this Black Friday will focus on value.
Because even though inflation is putting pressure on families to cut costs where possible, the holiday season remains the biggest shopping season, and Black Friday one of the biggest shopping days, of the year.
When we anticipate what we will see from consumers over the coming weeks, we can see a cautious optimism. Shoppers will be looking forward to buying gifts for the family members they haven’t seen since 2019, and marketers should show them that they care about meeting those needs. Consumers will be drawn to advertisements this year that empathize with the balance of stress over increased costs and excitement over a back-to-normal holiday.