Black Friday YOY Retail Sales Expected to Jump
Ready or not, the holidays are here. With Black Friday just days away, retailers are looking at how they can shore up their holiday marketing strategies to account for changing consumer habits. Markets are anticipating growth in retail sales.
Major retailers like Target, Walmart, and Amazon have already started offering Black Friday deals as a way to unload excess inventory, but a number of smaller, regional retail chains are holding back for now.
That’s because retailers without excess inventory are more likely to delay the start of Black Friday promotions this year since they have less need to clear out their stockrooms to make way for more goods.
While it’s not too late to roll out a Black Friday promotion, the clock is ticking. Experts say now is the time to experiment with discounts and deals designed to win over consumers amid rising inflation and changing consumer habits.
“In our latest Commerce Innovation Report, we found that it took 68% of companies three months or more to bring new commerce solutions to market. That is a significant business risk in an era defined by constant change,” says commercetools Chief Marketing Officer Jen Jones.
U.S. retail sales are expected to grow 15% on Black Friday, compared to last year, and department stores in particular are expected to fare well. According to data from Mastercard SpendingPulse, department store sales are anticipated to be up nearly 25% year-over-year, as consumers’ preference for omnichannel shopping—which allows for both online and offline shopping to take place fluidly—continues to grow.
“This holiday season, consumers are searching for deals, with a focus on pricing, value and convenience,” says Jones. “Given many retailers are urgently trying to clear their excess inventory and shoppers are looking for the best deals they can find, I anticipate that Black Friday sales will be much larger than they have been in previous years.”
Earlier forecasts predicted consumer spending would be down this year, however, Jones says newer data shows that consumers are not spending less, they’re just not as loyal to singular brands as they once were. As a result, a number of national retail brands have decided to go the extra mile when it comes to adopting new innovations to enhance the consumer experience and win over customers – from leveraging live shopping on Instagram and shoppable video on TikTok, to running mobile promotions.
For retailers that are late to the party, Jones says certain e-commerce solutions can shorten the time needed to roll out holiday promotions. For example, MACH-based (microservices-based, API-first, cloud-native, and headless) architecture allows retailers to modularize their digital technology into components that can be changed or swapped out, without having to upgrade an entire system.
Whereas retailers in the past would have had to purchase excess computing capacity to meet increased web traffic needs in November and December, Jones says cloud-native e-commerce solutions can now be used to optimize costs and scale at a much faster speed.
“Omnichannel strategies that allow brands to leverage these features across all touchpoints can help provide a consistent and frictionless shopping experience, whether customers are shopping in a store, on the website, within a mobile app, or all three,” Jones says.
For those that believe a recession is near, data is still showing that this year’s holiday shopping season will be strong. According to one recent survey from Deloitte, 74% of shoppers said they would either spend more or the same this holiday season as they did last year. That’s especially good news for retail giants like Walmart and Target, which need to get rid of excess inventory. For retailers that haven’t been as proactive in launching early Black Friday promotions, it means there is still time to get involved.
“We’re going to continue to see early promotions as supply chain slowdowns have shoppers concerned about shipping delays. Shoppers will also likely opt for BOPIS and curbside options at higher rates this year to avoid shipping hiccups and delays where possible,” Jones says. “Ultimately, shoppers are looking for frictionless experiences at every step of the buyer journey, so we can expect retailers to keep providing sales, promotions and extra checkout options that will give them that assurance.”