Black Friday helps ecommerce to a record November – spurred by heavy online discounting
Shoppers' move to shop online this Black Friday helped to push November ecommerce spending up by 22.9% in November, according to IMRG figures. But the latest IMRG Capgemini eRetail Sales Index shows just how far retailers cut their prices, with the average basket of electrical goods falling to £119. That's 22.7% less than at the same time last year – and 18.5% less than in October 2016. Average basket values also fell, year-on-year, in footwear, gifts, menswear and womenswear.
Justin Opie, managing director, at IMRG , said: “Black Friday has become cemented in the retail calendar, but it continues to challenge retailers on profitability. Its image has become heavily linked to discounting and many feel under pressure to slash prices in order to attract shopper attention. One trick is to try to use discounting to pull shoppers in, but restrict it to a selection of products in the hope that they will buy other products either at lower discounted rates or even full price, to help balance out any hit to margins overall. It may be that this approach was more successful in some sectors than others.”
Bhavesh Unadkat, management consultant in retail customer engagement design at Capgemini , says that Black Friday is in effect eating into December sales. “Given that Black Friday has peaked year-on-year in the last three years, perhaps it’s no surprise that the index registered such a strong result in November.
"What we’re seeing however, is that this surge is actually cannibalising purchases across the peak period. Online sales the week before Black Friday fell an average 7%, while Boxing Day sales have dipped consistently over the last three years. This has even impacted Cyber Monday, with the bulk of shoppers making purchases between Thursday and Saturday, with sales then trailing off on the Sunday and Monday. In terms of what this means for retailers, maintaining momentum across the whole peak period has never been more important.”
Across the sectors, November sales of accessories rose by 60.5%, while gifts were up 47.2%, lingerie was up 35.8% and clothing was up 24.0%. The only sector that failed to grow was health & beauty, which was down 4.2%.
At the same time, multichannel retailers outperformed online-only retailers, turning in higher retail sales growth rates for only the second time this year, and by a significant difference of 9.9 percentage points.
Across mobile channels, tablets’ resurgence continued with sales completed on the device up 12.5% year on year. Sales on smartphones grew by 89.2% compared to last year. Both figures exclude travel retailers.