Now a momentous time in the retail calendar, Black Friday makes for a useful marker when analysing retail recovery following the height of the coronavirus pandemic.
The origins of Black Friday in the UK
Originally an American event that sees the biggest retail discounts of the year arrive after Thanksgiving to mark the beginning of the Christmas shopping season, Black Friday, like so many Americanisms, eventually made its way around the world. In the United Kingdom, the phenomenon started to gain significant traction in the early 2010s when US-owned companies with British branches began to bring the season of sales to this side of the Atlantic. The concept soon gained popularity and snowballed into the nationwide event that it is today and has seen the country’s annual retail sales take shape around this day of low prices and crazed Christmas spending.
The effect of lockdown on Black Friday in 2020
With Black Friday now being the most momentous time of the year in the retail world, it makes for a very useful marker when analysing retail recovery following the height of the coronavirus pandemic. The usual scenes of huge crowds squeezing through shop doors and stripping the shelves of all their wares were nowhere to be seen in 2020, as COVID restrictions had long since sought to limit large gatherings of people. Even as the sales moved online last year, average online orders for Black Friday dropped compared to the rest of the year according to global delivery experience platform Sorted, suggesting that a whole year’s worth of buying everything from gifts to groceries online had left the population shopped-out and keenly awaiting the reopening of the high street.
This year’s post-COVID Black Friday in the UK
2021, however, sees the British high streets surging with shoppers perhaps more than ever before and this has been reflected in the figures for spending on Black Friday. Statistics from Barclaycard show that payments made with their cards between midnight and 5pm on Black Friday were up by 23% from last year. This isn’t all that surprising given the lull that hit the retail market in 2020, and the payments compared to 2019, although still up by 2.4%, aren’t as drastic. The chief executive of Barclaycard Payments, Rob Cameron, has pointed out that certain other factors, like the recent supply shortages that have been affecting the UK, have limited the extent of 2021’s Black Friday spending boom. Numbers from Nationwide, however, reveal that their customers’ purchases, which total at 5.95 million, are not just up by 26% on last year, but by 24% on 2019 too.
Whilst the full figures for the UK’s Black Friday spending this year have not been completely gathered and reported yet, the pre-Friday forecasts predicted total spending to come in at around £9.42 billion, an all-time record and an increase of more than 18% from 2020 and nearly 10% from 2019. Due to the pandemic, 2020 saw the first year in the UK wherein more money was spent online for Black Friday than in stores. Not only was this preference for online shopping predicted to continue into 2021, but it was also forecast that the rift between online and in-person spending would become even larger, with growth in online sales predicted to exceed 20% from 2020 compared to 7.3% growth for in-store sales. As a result, even though Black Friday spending is predicted to reach a record high, in-store spending has not been forecast to surpass its pre-pandemic levels. This suggests that, although online shopping was initially seen as a necessary evil due to lockdowns, many people may have become comfortable with online purchasing and see it as a more practical alternative to the hustle and bustle of Black Friday’s packed high streets.
What this means for SME owners
The main things that should be taken away from these Black Friday statistics is firstly that the retail industry looks to be back on track following the lull that came with lockdown and secondly that, despite the UK public’s seemingly rocky relationship with Internet shopping, making purchases online is becoming the norm for many people. For SME owners, the return of the high street is no doubt a fantastic thing, but the fact that so many people seem to be sticking to shopping from behind a screen may be concerning for those smaller retailers who don’t have the means of setting up shop online. Whether or not this shift to Internet shopping is permanent is unclear at the moment, especially seeing as the possibility of further lockdowns is potentially under consideration at the moment, which may leave small and independent shop owners apprehensive for the future of their business.
If you run a business that you feel may be impacted by these trends, contact Voscap today at 020 7769 6831 or email firstname.lastname@example.org for advice from one of our business recovery specialists.