CHRISZELLE JOSEPH: Shoppers should expect fewer Black Friday bargains

SA shoppers may want to dial down their Black Friday expectations this year.

With inflation squeezing wallets, supply chains under strain and retailers focused on their bottom lines, those door-busting discounts are becoming scarce. Savvy shoppers might need to rethink Black Friday altogether, because the best deals aren’t guaranteed to show up on a single day any more. 

From a historical perspective data shows a marked slowdown in consumer enthusiasm for the annual global shopping frenzy. According to statistics from Absa, where transaction volumes on Black Friday experienced double-digit growth in 2021 and 2022, this slowed to just 4% in consumer spending and 8% in transaction volumes in 2023.

Moreover, on-the-day spending for Black Friday declined last year — the value of transactions dropped 4% compared with 2022. Furthermore, foot traffic plummeted in 2023 with an 80% decrease in in-store visits compared with 2022.

While some of this downturn could be attributed to Black Friday falling before payday last year, the data also suggests a broader change in consumer habits. Online shopping saw a 20% increase over the first 23 days of November 2023, while in-store spending rose by 8% for the same period, indicating that many shoppers are now seeking out deals throughout the month rather than waiting for a single day of discounts. 

Yet a deeper issue underlies these shifting habits. SA’s economic strain is fundamentally reshaping how, when and where consumers choose to spend. Essentials such as food, fuel and electricity have seen sharp price increases, which means many consumers are reallocating their spending to cover rising costs of living rather than discretionary purchases.

High interest rates have also made credit more expensive, deterring some consumers from using it for big-ticket purchases — a common tactic during Black Friday. Yet, according to Absa Merchant Spend Analytics, credit card usage during this period grew 12% year on year, while debit card usage slowed to just 1% growth compared with 13% in 2022.

This seemingly contradictory trend likely reflects the pressures of the economic downturn. While some consumers are hesitant to take on more debt, others are relying on credit as a means of managing rising costs and covering essential purchases, even if it means facing higher interest rates in future. 

Online shopping and social media have also made consumers more price savvy. They now expect competitive deals year-round, particularly with seasonal and post-holiday sales becoming more popular. This has contributed to what we might call “discount fatigue” — the sense that if deals are available frequently there’s less need to act immediately on Black Friday. 

All of this is not lost on SA retailers, but even as they adjust their strategies the sector is facing headwinds that complicate their ability to fully capitalise on Black Friday’s potential. The economic environment has forced retailers to walk a fine line with pricing. While deep discounts might draw crowds, they also threaten already tight profit margins. Rising operating costs — from labour to logistics — mean every percentage point cut from a price tag comes at a careful calculation, often making the large-scale markdowns of previous years unfeasible. 

Competing with e-commerce giants has also led retailers to adopt a strategy of continuous offers throughout the year, eroding Black Friday’s status as a one-day event. A big advantage for e-commerce businesses is data-driven agility. They track consumer behaviours in real time and adjust prices quickly, responding instantly to demand and inventory levels.

This has put pressure on brick-and-mortar stores, which traditionally relied on slower, seasonal sales cycles and fixed-price structures that were far harder to change midseason. To keep up retailers have had to rethink their promotional strategy, offering regular price reductions to maintain consumer interest and avoid losing sales to online counterparts that can afford to be perpetually competitive. 

Logistically, spreading promotions throughout the year also helps retailers manage inventory more efficiently. Instead of counting on a major Black Friday clearance, which requires enormous preparation and concentrated stock, ongoing promotions allow for a more controlled flow of goods, helping to reduce warehousing costs and prevent seasonal overstocking.

This approach aligns with how e-commerce businesses continuously optimise their supply chains, leveraging data to predict demand and avoid costly backlogs or stock-outs. For traditional retailers, adopting a continuous promotion strategy similarly smooths out inventory needs, ultimately reducing operational costs. 

However, with unpredictable weather patterns also disrupting traditional buying cycles retailers are often pressured to discount seasonal stock earlier to avoid inventory waste. A delayed winter or a sudden heatwave can throw off demand, pushing retailers to clear items out well before Black Friday arrives. By November, much of the seasonal inventory has already been marked down, leaving less room for dramatic discounts on the big day itself. 

In response, retailers are shifting towards “Black November”, a month-long approach that extends promotions across the entire month. This strategy offers a steadier revenue stream, reducing the pressure of one-day logistics and creating more flexibility in managing stock. Yet while this approach spreads out consumer interest, it also reflects the ways in which Black Friday is losing its status as the pinnacle shopping event, becoming instead a quieter season of discounts stretched across November.

For consumers, this shift means fewer of the dramatic, one-day-only discounts that once defined Black Friday. Instead, shoppers can expect more modest price cuts dispersed over the month, requiring a savvier, more patient approach to find the best deals. 

• Joseph is senior coverage banker: consumer goods & services at Absa CIB.