South African shoppers may need to temper their expectations for Black Friday discounts this year as market trends reveal a decline in consumer enthusiasm for the annual shopping extravaganza.
Retailers, meanwhile, are adjusting their strategies by extending promotions throughout November, creating a “Black November” rather than a single-day spending spree.
Data from Absa Corporate and Investment Banking (CIB) paints a sobering picture.
In previous years, Black Friday saw double-digit growth in consumer spending and transaction volumes, with significant spikes in 2021 and 2022.
However, in 2023, this growth slowed to just 4% in spending and 8% in transaction volumes.
Moreover, same-day spending for Black Friday 2023 declined by 4% in rand value compared to the previous year, and foot traffic in physical stores plummeted by a staggering 80% year-on-year.
Some of this decline can be linked to timing—Black Friday 2023 occurred before payday for many South Africans.
However, the data also signals a broader shift in consumer behaviour.
Online shopping surged by 20% in the first 23 days of November 2023, while in-store spending rose by a modest 8% over the same period.
This indicates that shoppers are increasingly spreading their spending across the month, opting for deals available throughout November rather than waiting for a single day.
Christelle Joseph, Senior Coverage Banker for Consumer Goods and Services at Absa CIB, attributes this shift to South Africa’s challenging economic environment.
“South Africa’s economic strain is fundamentally reshaping how, when, and where consumers choose to spend,” she explains.
Sharp price increases in essentials like food, fuel, and electricity are forcing many consumers to prioritise basic needs over discretionary purchases.
Joseph also notes that the retail sector is feeling the impact of this shift.
Traditionally, the fourth quarter has been a critical period for retailers, buoyed by holiday spending.
However, this year, retailers are unlikely to see the same level of performance due to prolonged economic pressures.
High interest rates, persistent inflation, unemployment, and low household incomes are squeezing consumers’ wallets and reshaping spending habits.
Retailers are also facing their own challenges.
Balancing competitive pricing while navigating rising costs has become increasingly difficult.
The rise of e-commerce giants has further complicated matters, as consumers now expect discounts year-round.
This has led to a phenomenon Joseph describes as “discount fatigue,” where the ubiquity of deals dilutes the urgency traditionally associated with Black Friday.
To adapt, many retailers have shifted to offering regular price reductions, making one-day events like Black Friday less critical.
The move towards a “Black November” strategy reflects these changing dynamics. Instead of dramatic, one-day-only discounts, shoppers now encounter more modest deals spread across the month.
For consumers, this shift necessitates a more measured approach to bargain hunting, as the standout deep discounts that once defined Black Friday have become less common.
Ultimately, the data and market trends suggest that both consumers and retailers are recalibrating their approach to Black Friday, driven by economic realities and evolving shopping behaviours.
The era of frenzied, one-day shopping sprees appears to be giving way to a more protracted, deliberate period of promotions, leaving South Africans to navigate a new landscape of deal-hunting.
