The Real Deal About Black Friday and Cyber Monday
The past two years have brought with them many retail changes. One glance at an empty store shelf reveals how inventory and supply chain hiccups have become an ongoing issue since the start of the pandemic. Retailers all over the U.S. now manage shopper expectations with phrases such as “Now’s the time to be thinking about your holiday gift list before the items you want are gone.” It’s safe to say that in the U.S., we're in a state of shopping flux.
That same state of flux can be applied to U.S. shopper sentiments about Black Friday, too. In its heyday, Black Friday was a highly anticipated late-night shopping adventure. It brought with it expectations of great prices that would only be available for those willing to head to the mall with the rest of the world looking for a deal.
As our shopping habits have shifted increasingly online, Black Friday and its online equivalent, Cyber Monday, have merged into one event coined BFCM. Shoppers compare prices and continue to look for the best deals both in brick-and-mortar stores and online storefronts. Though BFCM is known by everyone as a time for great deals, there are indications that shoppers expect more than just price reductions.
Black Friday Sentiments Include Distrust
At LoyaltyLion, a data-driven loyalty and engagement platform for e-commerce brands, we recently released The new discounting playbook. It shares the results of our surveys where we spoke to over 2,000 U.S. consumers about their feelings towards BFCM and the deals being offered during this time period. Sixty-two percent of American consumers feel that BFCM discounts are never as good as they expect them to be. A resounding 65 percent of those surveyed said that the products they want aren't usually discounted, making the retail event a waste of their time. Significantly, 62 percent also felt that BFCM discounts “pressure” them into making purchases they wouldn't have made on their own.
What's even more surprising is that the feelings consumers had for Black Friday deals also influenced their opinions of the brands offering the price reductions. It was interesting to note that 59 percent of U.S. consumers expect brands to push lower quality products during BFCM, and 63 percent said that the deals and offers provided during this period impacted their trust in brands. Sixty-three percent felt brands focus on winning new customers over making their existing customers feel special during BFCM.
It’s Time to Modernize the Notion of Black Friday
The research provides insight into how BFCM needs to evolve to continue to emotionally connect with consumers and convert that connection into sales. As it turns out, it's possible to get customers excited about a brand without relying on discounts only. While 80 percent said that unconditional percentage-off discounts appealed to them, alternatives that protect profit margins weren’t far behind. Eighty percent of shoppers said that free or discounted shipping would make them feel positively about a brand as would loyalty points that they could redeem for future purchases. And an enthusiastic 76 percent said birthday special offers also held appeal. In these positive responses, it’s clear that there are alternative ways to create brand loyalty without harming profits over the seasonal sales.
This BFCM, the brands that can supplement their discounting strategy with alternative incentives, while considering how the lifetime value of BFCM customers could be increased year-round, will be the ones that succeed. They will be the brands that give consumers that needed “extra” factor and will show customers they're valued. These supplemental deals for loyalty could be offered in the form of additional percentages off that are unlocked when someone leaves items in a shopping cart, or by giving loyalty points to customers when they make a purchase. Seventy-two percent of those surveyed felt that brands can also set themselves apart with actions that benefit the greater good, such as assisting customers in contributing to a charity.
This BFCM season, the businesses that offer alternative incentives alongside discounts will find that they will foster a positive response towards their brand — which in turn will support BFCM sales and long-term customer relationships. Alternative incentives for customers can ultimately result in a reduction in a shop’s reliance on regular discounting, and help build loyal, long-term customers that keep returning and buying products no matter the season.
Click here to download the full report from LoyaltyLion.
Charlie Casey is CEO and co-founder of LoyaltyLion, a data-driven loyalty and engagement platform that powers ecommerce growth.
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Charlie Casey is CEO and co-founder of LoyaltyLion, a data-driven loyalty and engagement platform that powers ecommerce growth. Proven to increase retention and spend, LoyaltyLion is trusted by thousands of fast-growth ecommerce merchants worldwide. Prior to founding LoyaltyLion, Charlie joined the Foreign and Commonwealth Office as an Economics Advisor before becoming a consultant at Deloitte.