Tag: November

Black Friday is not a charity, consumers warned

Source: Supermarket & Retailer

Black Friday, which falls on 29 November this year, may feel like an annual treat for thrifty shoppers, but it has little to do with altruism. For retailers it is all about maximising consumer spend.

Some Black Friday bargains will save you money, with some items selling at or below cost price, but profit-starved stores, especially those in South Africa under extreme pressure, do not plan to come in at a loss for the day.

Rather, online and brick and mortar stores use the annual shopping day to manipulate consumers, get feet through doors, win hearts and minds, and generate additional revenue.

In South Africa, shoppers spent close to R3 billion at stores on Black Friday 2018 – a leap in spending so high that it even helped ‘save’ the country’s economy after a torrid year. And with South African consumer spending habits often dictated by pay day deposits, it’s an expense that few local consumers can actually afford.

In order to get consumers parting with their cash, and then, ironically, thanking the stores while doing so, retailers employ several tricks and techniques – many of which are refined each year as the shopping day continues to gain traction in South Africa.

This is how stores will try to trick you into spending more money than you probably should on Black Friday 2019.

Stores will build up your bargain-seeking arrogance – to your detriment.

The psychological manipulation starts long before anyone bangs on the store doors early on Black Friday morning itself, and all the retailers taking part are conspiring against you.

Stores use several psychological tricks to manipulate shoppers, but one of the most important is boosting your certainty of finding a great deal on days like Black Friday, according to brand and consumer specialist Martin Lindstrom.

He argued on Bloomberg that most of what we do while shopping is irrational and subconscious, and calls the mall “the soul of seduction”. The more rational shoppers think they are, he says, the more likely they are to be manipulated.

In other words, you might think it’s entirely rational, and even pretty genius, to be tracking down that amazing deal on Black Friday – but if anything, this confidence just means you’re more likely to fall prey to their tricks.

Building up the hype prior to Black Friday reinforces the idea that great bargains are to be had. Also watch out for messages that tease limited availability and the need to pounce on deals while they are available, rather than sitting on the idea of buying that brand new washing machine until it is “too late”.

“Limited stock” is just that – especially if the numbers aren’t specified.

Mainstream stores will not risk being caught for fraud; if they advertise a once-in-a-lifetime discount of tens of thousands of rands, they really will sell at that price. But there is no requirement for them to have enough stock to make sure you too can get that item at that price.

Be especially worried when the level of stock is not specified, because “limited” can mean “one”.

Stores count on the fact that the adrenaline rush of Black Friday will make you grab a “deal” you haven’t properly researched when limited stock means you can’t get exactly what you want – especially after you’ve camped out on a cold floor all night or obsessively clicked “refresh” on a web page.

Retailers lure you in with great deals, and then subtly tempt you to buy stuff that is not on sale

The concept of loss leaders – items that aren’t necessarily profitable, but sold to attract customers to other items – is nothing new, and not exclusive to Black Friday, either.

Between online research and social media, retailers have to offer genuinely good deals to get feet through their doors rather than those of competitors. If they draw enough traffic they may be able to offset the losses with higher volumes on regularly-priced goods, and they tend to do everything in their power to convince you to buy those.

In some cases it seems as if stores also subtly mark up items they think shoppers may not know the value of, and let the halo-effect of Black Friday give the impression that these too are really good deals.

Loss-leading is not a failsafe way for stores to generate profits, but they do work – to the extent that they’re banned in many US states and European countries.

The products on sale may be old….

Check the model numbers of the hot ticket items that are deeply discounted, and you may find that the products are anything but new.

Events like Black Friday are a great way to move old items that haven’t sold through the year, and probably won’t move during Christmas shopping either – and which will only drop in value as they are outpaced by newer models with new features or technologies.

These can still be great deals if you know what you are in for, and if you are happy with last year’s model, or one with limited features. Just don’t be caught with a “new” TV that isn’t quite what you expected.

… or inferior

Because American consumers can now be counted on to flood into stores for Black Friday, some manufacturers create products especially to capitalise on that spending.

In at least some cases, these special product lines are cheaper to make, and inferior, to mainstream product lines that carry the same name. Because of this, Forbes suggests that the very bastion of a Black Friday deal – the not-so-humble flat screen television – is better bought at other times of the year to avoid buying “toned down, derivative models”.

If you can’t find the model number for a common item from a big name with a simple Google search, beware.

You are not being paranoid: some stores will quietly increase prices before Black Friday to claim bigger discount levels.

As with some online stores in South Africa, those dramatic double-digit percentage discounts on offer come 29 November will not necessarily be as attractive as simple math would suggest.

That’s because in order to hit the advertised discounts, some retailers quietly increase the retail price of sale items a few weeks before the event.

That way they can genuinely claim a discount compared to what they were charging before, even though that is not necessarily the price that was generally charged.

Chances are you’ll get the same thing at the same discount later – and you may do even better.

It’s easy to fall into the temptation trap of Black Friday and think it’s the only sale of the year. But, in the US market at least, CNN claims that there are the same – if not better – deals to be had at other times of the year.

And the South African seasonal retail cycle is looking more and more like that of America, as Black Friday and Cyber Monday take hold here.

Sales on things like clothes and outdoor equipment are often dictated by the changing weather, so if you’re after summer fashion items, you may be better off waiting a few months after Black Friday.

Likewise, South African electronics stores increasingly release items like smart phones and televisions soon after they launch elsewhere. Those launch dates are often linked to big international events, such as the Consumer Electronics Show in the US.

So if you lust after a big-ticket item such as a new iPhone or a large TV, you might be better syncing your sales clock with, say, Apple’s international releases, and waiting for the fire-sale price drops that come when that now top-of-the-line phone suddenly becomes a previous model.

Source: Supermarket & Retailer

If 2017 is anything to go by, Black Friday is quickly becoming one of the busiest South African shopping days and, like the US, marks the beginning of the Christmas shopping season.

This year, online retailers are preparing for even more hype, but are we getting ahead of ourselves? Let’s take a step back and review what we can learn from previous years:

1. Start early to reap rewards
As early as October 2017, the N1 in Gauteng bore the fruit of well-planned marketing campaigns with enticing billboards. Research shows that more than 50% of holiday shoppers start researching gift ideas in October or earlier. This tells us that we need to plan ahead, and by early November, you’ll need to kick off your campaign to ensure marketing ROI.

Not only does this give you more time to generate opportunity, but useful, published links will start building page SEO – crucial in the ever-competitive e-commerce sphere. Major retailers are pulling out all the stops from well-segmented email marketing to encouraging customers to add products to their carts ahead of the day. But, Black Friday does not only attract the big players but the smaller retailers too. In 2017, Nichemarket listed more than 500 participating stores from niche to e-commerce giants.

2. Integrate and personalise
Sure Black Friday has a certain, recognisable look, but marketing efforts have become more personalised. Think beyond the homepage and set up custom product landing pages. Integrate these with your social media platforms for wider reach. Remember to include your marketing material throughout for a consistent, familiar message. Entice consumers with a clear USP.

3. Set the clock to create urgency
It’s a one-day-only type of thing, so get in with the hype and add a countdown timer to your website. Like Takealot, you can offer exclusive discount newsletter sign-ups with early deal leaks to get your customers on board. If you decide to extend the frenzy to Cyber Monday, communicate this with your customers before-hand. In 2017, Superbalist did this well by gamifying their deals with locks. Not only did they keep their customers informed but engaged throughout the entire weekend.

4. Make the most of seasonal shoppers
Before Black Friday, you need to have your Christmas specials in place to benefit from the Black Friday hype that still lingers. Allow it to link with Black Friday and continue to drive sales after the big day as people continue to shop over the entire holiday season.

5. Involve the entire team for great customer experience
On Black Friday you’ll be very busy. Whilst it’s important to drive sales, involve the entire team to ensure that you don’t neglect your customers. Done right, Black Friday is a great brand awareness tool, but if your customer experience suffers, even the brand loyalists may stray afterwards. You may need to hire extra staff or work longer hours.

6. Consider an omnichannel approach
Customer satisfaction extends to shipping, so consider offering free delivery or perhaps an in-store collect option for those yearning immediate gratification on their spend. It is important to understand the interchange between physical and online stores – consumers prefer an omnichannel approach where they can research and shop both online and in-store.

7. Offer generous discounts
Leading up to Black Friday, Game launched its online store with generous discounts knowing that it would motivate new and on-the-fence consumers to purchase. In the US “Black Friday bargains were bigger, on average, last year“.

Small, negligible discounts just don’t match the hype and it certainly won’t attract the powerful (and savvy online shopping) millennial consumer market. Before your brand jumps on the BF bandwagon, it may be wise to assess whether it’s worth it? Some shops choose deliberately to opt out and so could you.

8. Accommodate mobile users
Make it easy for customers to shop online by optimising your mobile checkout process. Consider adding a one-click checkout option to streamline the process, and offering real-time online support for quality customer support.

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My Office News Ⓒ 2017 - Designed by A Collective


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