Retailers cut prices ahead of Black Friday – and Brexit?
Prices are already dropping online ahead of Black Friday, new analysis suggests. Retail sales aggregator LovetheSales.com has tracked an 11% increase in the number of offers available over the last week, compared to the previous week, and a 16% fall in the prices of all products currently on offer from retailers – with a 26% fall in prices of women’s clothing. Prices, it says, are currently 20% down on the same time last year.
Some product categories are the cheapest they’ve been all year, says LovetheSales.com, with dining tables currently at their price since Black Friday 2017, and 46% down on last week. Prices of hair straighteners were 13% down last week, while women’s shoes were down by 8% – taking them to their lowest cost so far this year.
LovetheSales.com puts the prices falls down to a tough, hot summer, falling retail sales and footfall in September as more sales move online – concerns about the as yet unresolved Brexit deal and how it might affect spending over the peak trading period.
Stuart McClure, retail analyst and founder of LovetheSales.com, said: “In the last week, we’ve seen some big reductions in prices across retail. We’ve also seen uncharacteristic trends around product categories being at their cheapest in the year. This all points to retailers being concerned about performance over the peak holiday season.
“It’s been very tough year for retail. As we count down to the final Christmas in Europe, consumers will be wary about spending due to the uncertainty around a Brexit deal and how that will affect household costs.”
Deliveries slowed in September – are shoppers holding out for discounts?
There are suggestions that shoppers are holding off from spending, as they look forward to pre-Christmas discounting. The latest IMRG MetaPack UK Delivery Index Online detects slower than usual online shipping in September 2018 when it says retail parcel delivery order volumes rose by 6.4%, year-on-year. This, it says, is the lowest YoY rate in 2018 so far and also compares poorly with previous years. Order volumes often slow from month to month around this time of year, but this year, says IMRG, the decline has been sharper than usual. Between August and September, deliveries fell by 15.1% – a faster decline than the 12% drop seen last year between the same months.
“Does this suggest that shoppers have been holding off a bit and we’ll be heading for a big Black Friday and Christmas peak trading period, or could it be a reflection that people are perhaps not finding themselves with much disposable income and, given all the uncertainty around the UK economy at the moment, will retailers have to work even harder to hit their targets during the Golden Quarter this year?” asked Andrew Starkey, head of e-logistics at IMRG.
The index also found a record percentage of orders were sent using next-day delivery in September, with 55% of UK-delivered orders using the option. IMRG and MetaPack say that next-day delivery services are often used to drive sales and retain customer loyalty, but retailers’ abilities to fulfil the increasing volume of time-sensitive orders will be an important factor in how industry performs over 2018’s final quarter and, in particular, during the Black Friday peak, when order volumes are significantly higher than other times of year.
Meanwhile, IMRG says the percentage of orders arriving on-time has declined over the past 18 months or so, settling at around 90% for most of the year. Before next-day accounted for such a large share of orders, the rate was closer to 94%, it says, warning that if an increasing number of ‘guaranteed’ next-day orders are delivered outside the promised time window, customer experience would be impacted accordingly.
Maria Dahlquist Canton, global marketing director at MetaPack, said: “Peak will put retailer and carrier systems to the test when it comes to supporting services such as next-day delivery, which are clearly popular as our Index shows. However, if they use the sophisticated delivery planning tools that most have at their disposal, this should mean that they can meet customer expectations even if volumes rise sharply as we expect.”