With Black Friday coming up on November 24 and Amazon already running promotions, many entrepreneurial retailers are asking themselves an important question: Should they participate in it at all? The prevailing winds seem to suggest that the answer is ...and more »
With Black Friday coming up on November 24 and Amazon already running promotions, many entrepreneurial retailers are asking themselves an important question: Should they participate in it at all? The prevailing winds seem to suggest that the answer is yes, but there are reasons to be cautious before diving in.
While many consumers relish the hunt for bargains, others are becoming cynical about overhyped price discounts, disappointing stock availability, and retailers’ tendency to discount stale merchandise, rather than hot new products. Some shoppers don’t like the fact that retailers in certain stores are forced to work on Thanksgiving.
From a business point of view, Black Friday can sometimes fizzle, too. It can be useful for selling big box and tech items but not as much for impulse buys such as fashion, where people prefer to shop spontaneously, rather than in a prescribed sales window. And news reports of crowding and physical fights in stores have tainted Black Friday with an image that can hurt a retail brand. If you run a smaller, entrepreneurial retail business, offering steep discounts can potentially impact your profits more than for a large company that sells a much wider variety of merchandise at higher volume.
That said, consumers still do spend a lot of money on Black Friday. Everyone loves a bargain, and there is something almost primal about shopping. Last year, more than 154 million U.S. consumers shopped over Thanksgiving weekend, up from 151 million in 2015, according to the National Retail Federation (NRF). All told they spent an average of $289.19.
So what should you consider as you ponder whether to participate in Black Friday?
Here are four key considerations.
Will it help you achieve big-picture business goals? A Black Friday sale may give you a sales bump each year that is easy to get addicted to, but if it only attracts one- time customers, it may not have much long-term benefit.
Participating in a “buy local” effort that is likely to attract repeat customers from your community is a great way around this. One example is Plaid Friday, a buy-local event which started in Oakland, Calif., and has spread to other cities. Those who sign up for notifications from the Oakland group can get special offers from Nov. 1 to Dec. 31.
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