Where did consumers shop on Black Friday? Ther answer appears to be online with retailer JB Hi Fi, who appear to have benefitted from the crash of the Harvey Norman web site delivering over 25% growth to 33.7 million visitors in November 2023.
The business that normally averages around 21 million visitors a month saw a surge in traffic according to SemRush Research.
Also, up over 30% was The Good Guys with 10.5M visitors during the month with Black Friday traffic delivering significant growth.
In comparison Harvey Norman only managed to deliver 9.1 million visitors which was a 27% jump with the retailer struggling to generate traffic to their web site most times of the year compared to the likes of JB Hi Fi, Amazon, and Bunnings.
Big W managed 15.7M visitors which was only up 1.4% while traffic to Bunnings fell 6.35% to 35.9M, Officeworks managed 12.2M in November 2023.
NAB transaction data indicates shoppers spent a record $8.7 billion across the four-day Black Friday and Cyber Monday period, buying consumer electronics, appliances, cameras, as well as furniture and toys.
According to KPMG head of retail and consumer, James Stewart anecdotal evidence indicates that Black Friday sales went really well,”.
In Australia, online sales shot up 14 per cent on Black Friday with 78 per cent driven by mobiles, according to Salesforce data. Retailers slashed prices by 27 per cent on average.
Globally shoppers around the world spent a collective $US70.9 billion ($107.5 billion) that weekend.
For suppliers and retailers, the good news was that retailers didn’t need to discount so heavily as many people were turning to online shopping where retailers were able to manipulate their sell price based on emerging trends.
Online furniture retailer Temple & Webster’s revenue doubled this year to $17.4 million over the four-day period, while white goods giant Harvey Norman founder Gerry Harvey said sales were “very strong”, even despite the revenue it lost due to the website effectively crashing due in part to the use of old legacy technology.
Smiggle and Peter Alexander operator Premier Investments’ chairman, Solomon Lew said he was surprised by the sales generated during Black Friday. “It was stronger than I expected,” Lew said.
So, what’s next running into the holiday period.
Deloitte Access Economics partner David Rumbens claims, “Consumers are waiting for good deals to appear before they pull the trigger on purchases.”
“Competition is fierce for the limited discretionary spending available, and retailers appear to have pulled no stops during Black Friday”.
“But retailers cannot discount forever,” he said.
Retailers discounted earlier and more aggressively to entice consumers who were saving their dollars for a good deal before Christmas.
“Higher-than-normal levels of discounting might make sense now to lure in cautious consumers and to get rid of high levels of inventory, but it may not be sustainable in the long term,” Rumbens said.
Stewart said the best retailers are separating their Black Friday stock from Christmas stock to offer customers a point of difference and avoid a “cannibalisation effect.”
“What you don’t want to do is sell all your great product or discount on Black Friday and not have much to go to market with on Christmas … to try and protect margin sales and performance over both months,” he said.
“If many retailers could achieve about the same result or slightly better in December than [they] did last December, I think a lot of retailers would take that and say that’s a reasonably good outcome.”
Rumbens is anticipating some bright spots in the economy next year. He and Stewart pointed to strong population growth in helping to lift retail sales from minus-0.9 per cent in the 2023 calendar year to an expected 1.4 per cent in 2024. Wages are also expected to grow, which will loosen wallets.
