Black Friday 2020 – What Should Merchants Expect?
Walmart, Target, Best Buy and Kohls are among the first to make the big announcements that they will not be opening stores on Black Friday due to the COVID-19 pandemic, and they will not be the last. The news, while shocking, is not surprising. There have been many opinions levied about what this year’s famous shopping weekend will look like, and among concerns that spending will be down in relation to previous years, there is one fact that remains undisputed – online will be more important than ever before.
“Black Friday has definitely transitioned more into a digital affair in the past five years,” said Neil Saunders, retail analyst at GlobalData Retail. “The focal point is not that single day anymore. It’s an event spread out over several days.”
Macy’s CEO Jeff Gennette agreed with that sentiment, saying that he expected their sales event to “…start in full force after Halloween.”
“We’re also going to start offering some of the hottest deals of the season earlier than ever, to make it even easier for our customers to check off their gift lists,” Best Buy said in a statement.
Several other experts support this idea that the success of Black Friday 2020 hinges on retailers offering a longer holiday shopping period. This is a trend that we too have seen accelerating in recent years, where online brands will run large sale events in the weeks surrounding the holidays to get some “clear air” from the craziness of the Cyber 5 week. For Webscale, it means we start working with them to battle-test their infrastructure as early as, well, now!
Genette also echoed the industry-wide sentiment around the importance of online, saying that they would be “leaning into digital in a big way.”
“We have a very strong game plan about how we’re going to keep this trend of digital going. That’s going to be huge for this holiday season.“
While there is naturally a concern about how the inability to drive people into stores will impact numbers, there is evidence to suggest that following months of shelter-in-place orders, more consumers are shopping online than ever before.
National retail sales data supports this. Since 2009, ecommerce’s share of total retail sales in the US has been growing by ~1.5% each year, reaching 16% in 2019. However, in a single 8 week period around March-April 2020, that share increased 11%, with ecommerce sales now representing a massive 27% of all US retail sales. That’s a decade’s worth of growth in 2 months.
“You’ll see dramatic spikes in e-commerce sales.” said Michael Brown, a partner at Kearney, a global strategy and management consultant firm.
And there is one more spanner to figuratively throw in the works as we look ahead to this year’s holiday shopping season, and that’s what shopping environment states and local governments will allow – a tricky thing to predict given the rapidly changing nature of the pandemic across the country.
Whatever the guidance, it’s clear that major retailers will need to perform a delicate dance, as they balance the need to minimize risk to public health, while still doing whatever they can to make their numbers. And with many retailers making up to 75% of their yearly revenue during that 4th quarter, it’s important they do, as big misses during this season can have a dramatic impact on the hundreds of thousands of workers employed by these companies.
Online merchants begin their prep for this event now. Here at Webscale, we are working closely with our Partners and our customers, both current and future, to make sure their storefronts are battle-tested and ready to scale, secure and compliant, as well as blazing fast, so that they can take advantage of the holiday season, in whatever form it takes. If you’d like some help preparing your storefront for what could be a landmark event for ecommerce, drop us a line to firstname.lastname@example.org.