Partner Article

Are UK SMEs missing the Black Friday boat?

Raj Sond, General Manager, First Data Merchant Solutions (FDMS).

With the promise of cut-price bargains and offers not to be missed, Black Friday is a retail date that has grabbed the attention of the nation. Originally a fly-by-night American import, the date gained real traction in the UK last year, with a rise in sales of electrical goods by 32% and department store sales up by 15% - the biggest increases since records began in 1988.

This year it is projected to be even bigger. Experian has estimated that 27th November will become the UK’s first billion-pound day. With so much hype around this day, First Data Merchant Solutions (FDMS) decided to gauge SMEs views on Black Friday, and what we can expect from independent retailers.

The results were surprising. 94% of SMEs questioned said that they have never provided any kind of promotion or discount on this day, with a further 81% saying that they will never consider discounting for Black Friday in future. But is this an ill-judged decision? If SMEs were to capitalise on this phenomenon, they could potentially see a positive impact on their business by striking the balance right.

Getting personal

In the past, Black Friday has been criticised for coercing people into making rash purchases and buying items that they really don’t need, let alone even want. But this bombardment of irrelevant offers needn’t be a negative for small retailers – it actually serves as an opportunity for SMEs to show where their personal touch alone can be a key selling point. If they are able to delve into the goldmine of customer data they have on file, they can make sure that they offer tailored and relevant discounts and deals to their customers.

For example, if you’re able to identify the customers that buy a certain item regularly, you could add a ‘three-for-the-price-of-two’ offer on to that product. Not only will you increase the chance of continued custom and secure extra purchases, you won’t fall into the category of an irritating email spammer. In a separate study, we found that 66% of consumers would leave a store without making a purchase if they were bombarded with products that they were not interested in. Therefore, it’s important to get this discount dilemma right!

Preparing for success

On an average shopping day it’s frustrating for any shopper to find that their item isn’t in stock. Particularly on Black Friday, some shoppers will have a specific item in mind. A pair of state-of-the-art headphones, a glamorous dress for the upcoming Christmas party, or a pair of running trainers ready for the New Year’s resolutions. With the added excitement of getting your hands on your desired device, or even just the prospect of a spending splurge, it can be even more disappointing for shoppers to find that their item isn’t available when they come to checkout, or get to the till. In fact, 72% of people said they wouldn’t consider looking for another item if their original preferred item wasn’t available.

But again, this provides an opportunity for SMEs to be seen as a cut above the rest. If you can check your real-time stock levels, you can make sure that your business is completely prepared ahead of the day, especially if you can see that one particular item sells well usually. Disappointing customers with the ‘out of stock’ scenario doesn’t have to be a problem for your business.

Small retailers could easily slip into the mind set of thinking that this shopping extravaganza is a day exclusively for the larger multinationals. Whilst the likes of Amazon and John Lewis might grab the headlines, this doesn’t mean that SMEs can’t get in on the action. With a targeted and tailored approach, smaller businesses could really be surprised by the outcomes and cash in on this lucrative shopping date in the retail calendar just in time for Christmas.

This was posted in Bdaily's Members' News section by First Data Merchant Solutions .