In this article- Steve Brockway, Chief Research Officer reviews the Black Friday event and provides insight on the impact this is having on both customer behaviour and the user experience. The conclusion is that it is vital to have the correct customer feedback solution in place so retailers can understand the full picture that any event has on the user experience, particularly your most loyal and valuable customers.
So what happened on Black Friday 2017?
First appearing just 5 years ago Black Friday has become a marked event in the UK retail calendar, typically occurring on the last Friday in November – perfectly timed with many customers November pay packet.
Last years retail sales figures from the ONS jumped by 5.9% in November compared with the same month the previous year as shoppers took advantage of Black Friday discounts. This year, despite the recent budget fore-casting slower than expected growth for the economy initial data (1), indicates that online sales were £1.39bn, a year on year uplift of +11% for the day.
This is supported by published data from Barclaycard, who process nearly half of all debit/credit card transactions who estimated that Black Friday spending finished up 8% on 2016.
Early indications also reveal that online retail performed stronger than traditional high streets. Visitors to retail parks and shopping centres were down 8% (2) John Lewis were also quoted as saying “Sales on Johnlewis.com both overnight and into the day have exceeded expectations”(3).
This has continued the trend observed since three years ago when near riots broke out amongst shoppers, as shoppers prefer to use the convenience of online browsing and buying.
We also observed that Black Friday is no longer a single day event with promotions running both before and after the actual show, as retailers attempt to spread demand over a number of days rather than one huge spike. Data from the IMRG(4) who were tracking 210 retailers over this event demonstrated that many retailers were running Black Friday events several days beforehand, with 77 already promoting campaigns on Monday, rising to 168 by Friday.
Our collected customer feedback data supports this with 63% of online visitors to key retail sites over the period Friday 24 to Monday 27th November saying they thought the Black Friday event was ‘Longer than usual’.
And what is happening to customer behaviour during the event?
As experts in Voice of the Customer solutions Maru/edr undertook two methods of investigation to provide insight into the Black Friday event:
- Firstly, we added some ‘hot-topic’ questions into the many retail websites we collect feedback on, to better understand shoppers behaviour and attitude
- Secondly, we compared some key user experience measures during and in the lead up to the event to establish if there are any changes in the customer experience
Our data (5) also supports the growth in sales figures above indicating customers are engaged with taking advantage of Black Friday deals with 71% of those visiting over the Friday-Monday period saying they are there because of ‘Black Friday deals’. Moreover, out of those who purchased, 61% did buy based on a Black Friday deal, providing more evidence that visitors were on the look-out for a bargain. There was also a perception that the offers were good value with two-thirds stating that there were ‘About the same deals and offers as previous years’, indicating retailers are still strongly participating in the event.
The majority of purchases were ‘gifting’ with 60% stating some or all of the items were a ‘Christmas present’, however, this event does not appear to fundamentally change the pattern of Christmas sales with only 12% saying they undertook ‘most’ of their Christmas spending during the Black Friday event. The majority of 61% stated that most of their Christmas shopping would occur after the Black Friday event, during to the lead up to Christmas.
“Shoppers prefer to use the convenience of online browsing and buying”
Black Friday is no doubt a big retail event, attracting shoppers to go online and find a bargain to help with their Christmas gift shopping, but our data suggests this is not creating as large a ‘mortgage effect’ as some analysts predicted with much-planned purchasing activity still occurring through-out December.
“Black Friday is not creating as large a ‘mortgage effect’ as some analysts predicted”
Our data further supports this when we looked at the answer to what customers would do if the Black Friday event did not happen, with just under two thirds (64%) stating they would ‘still spend the same amount’ during this period. The longer promotional period that retailers now run, both before and after Black Friday, may also be contributing to this with customers feeling less pressure to ‘buy on the day’.
What about the customer experience during Black Friday?
Part of our analysis of the event focussed on our key tracking KPIs that we run across many of our online Voice of the Customer solutions for our retail clients, and we analysed these at an aggregated level to better understand what happens to the user experience during this event.
As expected we did see an increase in visitor traffic across all the sites we monitor and this was made up of both infrequent and more loyal regular customers. However, the greatest increase was in less loyal customers indicating that many ‘bargain hunters’ are scouring websites during the event looking for the best deal without any degree of loyalty. This is also supported by our brand advocacy rating running across the websites that we track, which declined 6 points during the Black Friday event indicating a less loyal visitor base.
Another area that declined (when compared to the preceding 4 weeks) was key user experience ratings for perceived ‘Site speed’ which declined by 3 points, and ‘Out of stock’ which increased by 8 points, for being the main reason why a purchase was not made on the day.
“Black Friday offers clearly attract a peak in browsers, many who are infrequent and less loyal visitors”
This paints an interesting picture for retail websites as their Black Friday offers clearly attract a peak in browsers, many who are infrequent, less loyal visitors, which is having a subsequent impact on the user experience, particularly around the perceived speed of site and availability of desired products.
“The major challenge … appears to be not the mortgaging effect on sales, but how you avoid creating brand detraction from your most loyal customers”
The effect of this is that a brand’s regular, loyal customers will be having their usual good experience impacted by an event which attracts a spike in less loyal bargain hunters. This is a real challenge for retailers who want to drive sales but at what expense to the experience of their regular and most loyal customer base?
“Retailers are targeting loyal customers with special previews and discounts”
The major challenge for the online retail industry does not appear to be the mortgaging effect on sales, rather, how you avoid creating brand detraction from your most loyal customers during a short-term event that creates spikes in demand and subsequently causes a poorer customer experience. One tactic we have seen in the retail sector this year is to target the highest value customers with special previews, discounts or offers before they are made available to the wider market, ensuring these valuable customers experience a more stable site and page loading speed but are also able to take advantage of offers with items being in stock. This is an innovative way of both managing demand on the site but also rewarding your most valued customers.
Black Friday 2017 Conclusion
“Black Friday is no longer a one-day event with customer demands spread accross more days”
Our conclusion would be that Black Friday, combined with November payday will continue to be an important retail event, but we will see a trend of customer demand spread across more days as Black Friday becomes a third quarter event, rather than a one-day sales spike.
Attempting to manage demand by spreading out the peak is a sensible approach for retailers as our online trackers indicate attracting a sudden spike in infrequent visitors, who are bargain hunters, can have a negative impact on regular, loyal users of your website – who are the most valuable asset a brand has. This combined with initiatives to reward your most loyal customers through personalised and exclusive offers could turn the Black Friday event into a win-win, whereby retailers can participate in the event, but manage previous unprecedented spikes in demand to both protect customer loyalty but also attract new customers and drive sales.
To achieve this insight it’s important to be monitoring customer experience on your website, and Maru/edr have a range of solutions covering all your digital channels, including website, mobile and app to enable instant feedback for action and sector experts to provide actionable insight. Talk to us about online Voice of the Customer programmes so you can listen and act on your customer’s experience.
¹ IMRG – what did we learn from Black Friday
² Diane Wehrle Springboard shopper traffic
³ Dino Rocos retail Operations Director, quoted in The Guardian Friday 24th November
⁴ IMRG Black Friday 2017, online retail sales results
⁵ Customer feedback data collected by Maru/edr during and leading Black Friday event between 23 October and 27th November. A total of 7,605 responses.
Steve Brockway is Chief Research Officer at Maru/edr providing innovative thought leadership and research excellence to Maru/edr clients and researchers.