Black Friday evolves into key November event in Australia

Black Friday sales have evolved into "Black November" in Australia, with consumers engaging in earlier shopping activities and a notable increase in spending.

Rob Hango-Zada, Co-Founder and Joint CEO of Shippit, highlighted the transformation of Black Friday from "an online sales phenomenon" to the "biggest event in the retail calendar" in Australia. He noted, "Its popularity in the last few years has been more pronounced with events like Click Frenzy kicking off the sales season early. Through discussions with thousands of retailers on Shippit, our data also supports the rise of this event as one that can make or break the retail sector. The one question that remains is not whether retailers can make up for lost time but whether the deep discounts on sales that have been deferred or brought forward are sustainable for the long term."

Based on Shippit's analysis of over 20 million orders across 4,000 retailers, there has been a 15% increase in purchases during the Black Friday/Cyber Monday weekend in 2024 compared to 2023. Shoppers are not just purchasing more frequently, but are also spending more per transaction, with the average basket value rising by 5.7% from 2023.

The sales growth was widespread across different regions with consumers from both Metro and Regional Australia spending more online. The sectors showing the most significant increase in order volume are Kids Clothing/Accessories at 355.0%, Food and Beverages at 320.2%, and Department Stores at 164.9%. Machinery, Tools and Hardware observed an increase of 86.9%, while traditional categories such as Computers & Electronics and Shoes & Footwear saw increases of 27.4% and 21.8%, respectively.

Australians' spending habits also reflected macroeconomic factors. The introduction of tax cuts in July aimed at stimulating household spending and the drop in inflation to a near four-year low in October suggest the economic pressures are somewhat easing. The average number of items per basket decreased from 3.2 in 2023 to 3.0 in 2024, but with a notable increase in the average item value from AUD $38.6 in 2023 to AUD $43.5 in 2024.

"Black Friday has become the key event on the annual retail calendar," Rob Hango-Zada remarked. "Both shoppers and retailers were very well prepared to shop the bargains this year. From our perspective, sales growth has been solid, with shoppers embracing the deals earlier this year. Major retailers began promoting their Black Friday deals around 19-21 November which triggered a step-up in sales and traffic, particularly online."

Research indicates that 65% of consumers now plan to conduct their Christmas shopping exclusively during sales periods, emphasizing the strategic importance for retailers to attract early consumers before they switch to competitors. Black Friday is now seen as a crucial period for retailers, not just another sales event.

Hango-Zada added, "While shoppers are seeking out a discount, it's not the only factor that influences their purchasing decisions. According to Shippit research with Jarden, 55% of shoppers said price was one of the three most important factors when it comes to their purchasing, closely followed by delivery at 52%. Four in five (78%) said the post-purchase experience was either very or extremely important, while 62% consumers would be less likely to shop a brand again if their delivery experience was poor."

As such, maintaining a robust and efficient delivery process remains critical for retailers in ensuring customer retention. "Few things impact loyalty more than delivery today," Hango-Zada stated. "Key, though, is both the speed of delivery and speed of fulfilment. Carriers are delivering on their side of the bargain with more efficient and flexible delivery; now it's time for retailers to step up by improvising their speed of their fulfillment. If retailers can win over their customers with quick, convenient delivery during the next month rush, they'll be better placed to lock in the loyalty of those customers long-term."