Black Friday, a day of massive sales that originated in the US, has become a mega shopping phenomenon in South Africa over the past two years.
This year it falls on November 23 – and given the soaring costs of petrol and slow economy, SA consumers are on the hunt for some serious savings.
“Our world is changing fast. Consumers, users, and buyers are calling the shots,” said Kali Moahloli of the market analysis firm GfK South Africa.
Many promotional discounts will be so steep that retailers could end up making a loss, said a global measurement and data analytics company, Nielsen South Africa in a report released to the media.
Here are 7 things you didn’t know about Black Friday in South Africa.
According to Nielsen, Black Friday was responsible for around R1.36 billion in extra sales last November – just in the fast moving consumer goods (FMCG) sector.
Nielsen retail data shows that that FMCG sales, such as toiletries and packaged food, was up by that amount compared the the previous three months of that year. Measured against 2016 sales, the increase was even bigger.
According to Nielsen, South Africans are using Black Friday to stock their pantries, purchasing goods with longer shelf-life like coffee, ready-to-eat cereals, squashes, and cordials.
Nielsen South Africa's Kerith Botha says that while Black Friday drove FMCG sales, certain categories were immune to discounts and did not entice additional consumption at a lower price. These included goods that have a limited shelf life, or do not fit into small cupboard or freezers.
For staples such as bread, consumers switched to discounted brands, but didn't buy more than usual.
Last year, panel television unit sales climbed by 47% and smartphone unit sales increased by 63% during the week of Black Friday compared to the same week in 2016, according to analysis by Gfk South Africa.
“[Black Friday] has grown into a week-long frenzy of specials and promotions. And unlike summer or winter sales and promotions, it’s not about shifting old stock, but winning market share by offering consumers attractive prices highly coveted products such as games consoles, smartphones, computers and TVs,” said Maohli.
According to Gfk, South African prices in general are lower online than in-store throughout the year, including on Black Friday, as everyone fights for the attention of connected consumers.
On Black Friday, it seems, online shoppers are eager to spend, but they are also waiting for deals that are truly worthwhile, and can instantly compare deals. That competition typically forces prices down further than they go in stores.
The number of online consumers looking for Black Friday details will be on the increase. Gfk says around 65% of connected consumers used their smartphone to help shop for a product or service in the past six months, while 29% use their mobile phone to compare prices when out shopping in the real world.
Nielsen found several leading brands that did not participate in Black Friday promotions lost market share in 2017.
Woolworths was one of the larger retailers that didn't run specials in 2017, but indications are that it could be on board this year.
“Overall, seasonal sales (November and December 2017) did not suffer, with little forward buying or cannibalisation of December seasonal sales (from Black Friday),” said Botha.
Nielsen analysis shows South African consumers are showing more ‘deal and value triggered behaviours’, meaning they are on the hunt for bargains more often in the face of rising fuel, utility and food prices.
Also from Business Insider South Africa