Black Friday Madness: A strategy for failure Part 1

This is Part 1 of a 3 part series about the tradition of Black Friday in the retail world

Part 2

Part 3

Working in retail has provided me with a top notch education on being a smart consumer. Having started off in the pharmacy area of retail way back when, I was exposed to the concept of ‘loss leaders’ early on in my career. After having close to 25 Christmas’s under my belt, I have a few ideas about pre and post Christmas strategy. I’ve worked both sides of the border so I’m familiar with ‘Black Friday’ and ‘Boxing Day’. That’s why this article (http://finance.yahoo.com/family-home/article/108212/dirty-secrets-of-black-friday-doorbusters) grabbed my attention.

There are many good reasons to have a sale. Sometime we use sales to clear out product that is old or discontinued. Other sales are intended to build brand awareness or to introduce yourself to your local selling area. The fundamental reason we do have sales though is to increase traffic in the store. We lower prices on certain products to act as a draw to get people into the door and hopefully buying other products that are not on sale. If the goal of a sale is to bring people in and get them shopping, I have to question the validity of Black Friday sales and quantity allocations. Changes in the retail industry are creating an environment where Black Friday sales are becoming less relevant and can actually create short term damage to the brand.

The CNNMoney article doesn’t reveal anything new. This isn’t a master revelation that must be written into the Retail Talmud. Black Friday (and to some extent Boxing Day) sales have always had limitations and conditions. Consumers have to scrutinize the deal and savvy customers who understand sales will be the first to pass on these ‘super deals’. I applaud the fact that retailers recently begun advertising quantities available and are printing conditions and limitations more clearly on their media. Unfortunately, these disclosures only confirm low availability and strict limits on the deals. The whole purpose of a ‘big sale’ is to bring people in the doors. Current Black Friday strategies are flawed and create a hostile retail environment for customers. Retailers must consider the changes their customers are experience and create campaigns that will better serve their clientele.

Buying behavior and customer attitudes change from year to year. Our current economic client has created shifts in buying habits that retailers must understand and take action on. Black Friday deals that are weak in terms of allocation and model availability will not create the desired results. Merchants looking for increased basket size and return visits will not realize those goals. Instead you will see Black Friday deals sell out quickly with little or no margin intake and the alienation of the bulk of you customer base. That will lead to medium and long term image problems for your brand.

Tomorrow: Part 2: The value conscience consumer: What is your strategy for cherry pickers?