Black Friday – horror or success this year?

Speculation about how this year's Black Friday will turn out in our own industry and in other industries is hotly debated among experts, opinion leaders and the media. Among retail companies, there is great excitement about how consumers will react to the expected price increases from the various players.

Applianytt has therefore asked around and checked what the media has written about expectations for the fourth Friday in November, which this year is November 25th when Black Friday falls. Will it be a shocker or a success for the trade?

Statistics Sweden: Weak starting position for consumer durables

The starting point for the autumn sales is not the best - the latest statistics from Statistics Sweden indicate that retail sales volume through September decreased by 5.9 percent compared to the corresponding month in 2021, and that it was durable goods that pulled down these figures with a decrease of a whopping 8.1 percent. Grocery sales fared slightly better with a decrease of "only" 2.4 percent.

Overstock generates strong offers

The expert statements we can read about in the media that express strong optimism ahead of Black Friday emphasize that it is the strong will of the actors to empty their stocks, increase cash flow and create liquidity in the companies, which will generate strong consumer offers. Many companies have strong inventory pressure and see an opportunity to clear out their excess stocks during the period – with attractive offers of course. And the hope is that consumers will take advantage of this to buy things they have been planning for a while or even early Christmas gifts.

Black Month?

Most of those who spoke also believe in a ”Black Week” with bargain sales or even a ”Black Month” that opens up more good deals for a longer period of time. Arne Andersson, senior advisor at Svensk Digital Handel, speaks out in the magazine Market and confirms this:

– My personal belief is that it will be a very long Black Week. We saw last year that Black Friday itself was not as big as before, but that it was more of a Black Week and the question is whether this year it will be a Black Month.

Joakim Wirén, a well-known analyst at HUI, also speaks out in Market's digital edition about the extended sale period:

– The focus on price is increasing as household finances deteriorate. This in turn indicates a greater interest in sale periods in general. The period itself is growing. However, extending it even further risks diluting the offering. It is difficult to build relevance for your products at full price if they are on sale for long periods.

Could it be a shocker?

Many of the external factors that affect consumption do not directly speak for an exuberant increase in demand despite strong offers. This has been noted in the latest edition of Prisjakt's 4th edition of the Consumer Compass survey. Their so-called purchasing power index falls by eight percent compared to the previous quarter and it is clear that the price focus is strong. Consumers generally choose cheaper goods to ward off inflation.

Oskar Hagman, analyst at Prisjakt, tells the media:

– Despite high discounts, there will likely be fewer shoppers this year. We are already seeing such a trend – fewer shoppers are shopping and those who do shop are choosing cheaper product options than before.

There are also strong indications for this in Prisjakt's Consumer Compass: 28 percent of Swedes surveyed state that they will shop during the Black Friday sale, which is a decrease of a full 8 percentage points compared to last year.

– Getting to the same turnover figures as in 2020 when we were sitting at home and clicking and had money to spend, that will not happen, comments Oskar Hagman.

New sale team

It is hoped that customers will perceive Black Friday activities as an opportunity to buy Christmas gifts earlier, with less stress and at a lower price during this period. The new sales law, which limits the possibilities for 'dishonest' sale pricing, will lead to fairer sale prices and give consumers increased certainty to trust retailers' pricing and possibly also have a positive impact on sales.

Success or horror? We'll know soon...

/Kent Oderud

Market development