Internet sales as a percentage of total retail sales will most likely break through the 20 per cent for the first time ever this November, according to research by global real estate advisor Colliers International.
Helped by Black Friday, November internet sales are likely to be 50 per cent above the 2018 monthly average, approaching a record £2 billion – up more than 150 per cent compared to figures from five years ago, and up 15 per cent alone since last November.
Despite this, the number of brands choosing not to participate in Black Friday sales events are continuing to rise. In 2017, this included a number of major retailers such as Marks & Spencer, IKEA and Asda.
Black Friday is having a significant impact on consumer spending patterns, causing a sharper spike in sales earlier on in the Christmas run-up, disrupting the traditional week-by-week increase in spending during the weeks leading up to Christmas.
Nick Turk, retail director at Colliers International in the South West and Wales, said: “Offering significant price reductions in what should be the prime pre-Christmas trading period can cause in-store stock shortages, returns issues and margin erosion at a critical time in the retail calendar.
“During a period in the year when retailers should be operating at full margins, they are essentially giving away profits in order to compete for a higher share of consumer spending. As Black Friday turns from a one-day promotion into an extended event, this issue will only continue to worsen.
“Retailers have become wise to the trade distortion Black Friday creates. As a result, some are choosing to offer more targeted promotions instead of store-wide reductions in an attempt to tactically manage stock clearance and protect margins.
“Meanwhile, shoppers themselves are also starting to wise up to how much they actually save during Black Friday sales.”
According to research by Which?, 90 per cent of products investigated were available for the same price or cheaper during other periods of the year. Consumer scepticism is now such that some apps have been developed specifically to check the quality of Black Friday deals.
“With significant discounting leading to further margin erosion, consumer scepticism about the quality of offers and disruption to the vital Christmas trading period, it feels like ‘bricks and mortar’ retailing has never needed Black Friday less than it does this year,” says Nick Turk.