Black Friday forecast – a mixed bag in store for consumers

The weeks that followed the hard lockdown at the end of
March have been inconceivable for retailers with measures undertaken by
Government to reduce the transmission of Covid-19. This has included mandatory
isolation which has brought a sizeable chunk of the economy to a standstill.
Retail, one of the mainstays, ground to a halt with only essential retail
permitted to trade.

The unprecedented measures can be credited (in part) to
South Africa’s stellar management of the public health crisis which has been
said to be better than most developed countries.

With most parts of the economy now open and many employees
back in their offices, retailers are looking forward to the days surrounding
the American Thanksgiving holiday, a big draw for cash strapped consumers.
Locally, Black Friday conjures up images of snaking queues and crowded stores,
but it is likely to be muted this year as shoppers are required to social
distance and to wear masks in store.

Nashil Chotoki, National Retail Asset Manager for Redefine
Properties says stores will be expected to limit the number of people inside at
any one time as part of the health regulations.

We are already seeing retailers working around this by extending promotions rather than limiting it to just a few days. We expect to see a Black November or even a Black December as retailers go all out to capture the available Rands and cents.”

Creating
Covid-19 safe environments for consumers will also differentiate retailers and
shopping centres which can become a driver for footfall and spend. By and
large, all sectors in the country and more importantly, the retail sector, has
played its part in ensuring consumers adhere to public health guidelines by
enforcing masks, sanitising, and social distancing.

With
the threat of Coronavirus still clear and present, malls and national retailers
cannot risk attracting large crowds as seen in the preceding years, often
camping outside and queuing for hours for deep discounts. Black Friday is just
one more thing the pandemic has upended in 2020 but it is not all bad news.

Retailers are doing their best to safely draw in customers, and we have seen a better than expected recovery of retail footfall and sales. Since reopening, convenience malls have been performing better than large shopping centres as customers feel safer, in respect to Covid- 19, in outdoor, open air malls compared to enclosed shopping environments,” adds Chotoki.  

Black Friday is also
getting a pandemic makeover like everything else this year. Instead of waiting
for Cyber Monday, shoppers will be able to buy online all discounted products
as deals that are usually reserved for in-store shopping will appear
online during the month.  

In and through the
pandemic, shoppers moved to the safer confines of ‘online’ in greater numbers,
hoping to avoid crowds at stores, promise of contactless payments and retailers
were quick to pivot adjusting their online offerings accordingly. 

Covid-19 has accelerated online sales, in particular
groceries, however most online platforms are still operating at a loss and
therefore we expect ‘click and collect’ to be more sustainable due to the lower
cost of delivery
.” adds Chotoki. 

While online sales are growing, we do not anticipate
the South African market to reach levels being seen in developed
countries in the foreseeable future mainly due to cost, access to the internet
and logistics
.” 

Despite the euphoria around Black Friday and the sales
surge that follows, retailers are likely to run fewer discounting promotions
compared to last year’s “door busting” deals as they cannot afford the
reduction in margin following the series of Covid-19 related lockdowns.  

While retailers have accepted that it is likely to be a
muted affair, they can draw comfort from a consumer base that feels a little
more confident about spending, thanks to historically low interest rates which
have partially cushioned the impact of lower salaries and employment on retail
sales
,” concludes Chotoki.

Source: Propertywheel.co.za | https://propertywheel.co.za/2020/11/black-friday-forecast-a-mixed-bag-in-store-for-consumers/

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