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Asda’s Black Friday u-turn: brave, or unavoidable?


Asda, owned by that colossus of the retail scene, Walmart, is held to be responsible by many for the introduction of Black Friday to the UK market. Whether that is strictly true may be a point of contention, but it was certainly one of those leading the charge.
There is, then, an unavoidable irony in its decision not to engage with Black Friday this year.

This, an Asda spokesperson told eDelivery, is because the retailer had been listening to what its customers really want. In the US, Black Friday grew out of the Thanksgiving public holiday weekend and always signalled the start of the Christmas shopping period – prior to the last Thursday in November, Christmas shopping is unseemly across the pond.

Thanksgiving doesn’t really translate, however, and it’s not enormously surprising that some people denounce Black Friday as not being a natural fit in the UK’s retail calendar. This, according to Asda, is one of the main reasons it chose to turn away from the event – there is no public holiday in the UK and most people would rather a day of promotions and discounts wasn’t taking place while they were at work.

This is a very plausible explanation, but one that perhaps sits a little uncomfortably next to predictions of a 30% hike in interest in Black Friday from UK shoppers who are gearing up to spend £1bn on Friday.

There may well be other forces at work here; Asda has very recently mothballed a plan to create hundreds of smaller click-and-collect points in areas of high population density, and – with the launch of its ToYou service – is turning its attention to the issue of sweating its existing assets; why build yet more stores when you already have more than 600 of them? Surely you should be identifying opportunities to extract as much value as possible from the estate you have … and the same could be said of its vehicle fleet.

Or it may just be, as we were told, that it is living by its ‘everyday low prices’ mantra. Added to which is one of the findings from a report by LCP Consulting, which was featured on eDelivery earlier this week. As picked up by InternetRetailing, almost a third of retailers think Black Friday is unprofitable and unsustainable.

Maybe, having led the charge toward Black Friday, Asda is about to lead the charge away from it.

Several eDelivery readers have shared their thoughts on Asda’s withdrawal from Black Friday.

Chris Johnson, head of operations at Vouchercloud, said: “Taking Black Friday out of the picture for Asda entirely is a bold move, and perhaps that bold thinking is as a result of having something else up their sleeves. At this point though, the consumers will have the final say by reaching into their pockets – and we’re predicting the UK’s biggest Black Friday spend this year. Asda seeing none of that spend could have a profound effect, particularly given the media coverage that their withdrawal from the event has seen.”

Aakash Patel, is a retail analyst at Pragma, and sees Black Friday as having shifted behaviour, but not for the better: “Black Friday is likely to struggle to reach the heights of the US simply due to the fact it is not a public holiday as it is in the US. However, it has certainly shifted spending behaviour in the period and has arguably changed Christmas shopping as an experience for consumers.

“Research suggests that three in four shoppers reported that they had a bad experience of the day – mainly linked to crowds, stock availability and fulfilment, which could signal that a large proportion of UK consumers actually dislike the furore surrounding the discounting burst. Nevertheless, in a flash of panic, many retailers participated last year in fear of losing market share, which was followed by shoppers tightening their belts in the aftermath. This stopped the spread of purchases over the trading period and fostered a discount mentality in a time when shoppers are usually prepared to pay full price.

“Considering the examples of those who chose to dodge the promotion binge, such as Primark and Mothercare (who both saw underlying sales increase in the festive period last year), we believe avoiding the phenomenon may be beneficial to trade if managed correctly. In light of the fact that Black Friday is not ingrained within British culture and as it is not a public holiday, we would advise retailers to think hard before participating in Black Friday considering the potential impact on store ambience, sales over time, and margins, particularly if mark up before and after the event is not managed effectively.”

Naveen Aricatt, UK manager and legal expert at Trusted Shops, is another that sees Asda’s decision as a positive step: “Asda’s withdrawal from the retail race should be a warning for retailers to wake up and smell the coffee. Making a change in the wake of consumer disappointment and damage to brand reputation is the only natural step forward.

“After last year’s scuffles in its stores customers were deterred from returning, so a season long campaign which prevents them from feeling held to ransom is a positive step to limit the damage. For retail counterparts to have the same success they must take steps to change their strategy and planning.” “In order to regain consumer trust and win the hearts, minds and wallets of shoppers this Christmas competitors must pay close attention to detail to avoid a logistical nightmare. This means getting the basics right. Over promising on big discounts, free delivery, free returns and return after Christmas, in one transaction and such short time frame, is a recipe for disaster.”

We’ll be sharing more eDelivery readers’ thoughts later this week.

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