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With Thanksgiving just around the corner, online retailers are preparing for one of the biggest and busiest shopping days of the year – Black Friday.
Until a few years ago, Black Friday was exclusively a US shopping event, but it has made its way across the Atlantic and become a firm fixture on the UK retail calendar.
To put this in perspective, last year, British consumers spent £3.3bn during the five-day Cyber Weekend and this year, according to research, consumers in the UK are predicted to spend a staggering £5bn.
However, all the hype around Black Friday can create a dilemma for luxury brands and stores. These retailers have historically been reluctant to launch flash sales in fear of it devaluing their brand and, not to mention, reducing margin at the most profitable time of year. Yet, by not taking part, luxury brands could lose out on a prime shopping weekend when consumers are likely to purchase their products from stores offering a discount, or worse, purchase a similar product from a competitor.
With voucher and coupon sites seeing a 36.81% growth within the luxury vertical on our network, it is evident that consumers are becoming increasingly “price-savvy”, especially when making luxury purchases.
In light of this, I wanted to explore how the luxury vertical on our network performed during Black Friday 2015 to help shape your strategy this year.
To do this, I analysed the growth in traffic and conversions from all the luxury advertisers on our network during Cyber Week 2015 regardless of whether they took part in Cyber Week promotions or not. I analysed the data from luxury brands separately to the data from luxury stores (who sell products from luxury brands). Luxury stores tend to have a larger inventory of products, and therefore larger margins at their disposal to be able to run promotional offers.
My analysis found that, overall, both luxury brands and luxury stores saw a consistent increase in YoY traffic in the build-up to Black Friday. We can assume this is down to an increased awareness of the event and consumers looking for luxury items with discounts.
As expected, as soon as a luxury brand or store issued a promotion or discount, we saw a spike in conversions. This is evident by the drop in conversions during the weekend after the initial Black Friday rush.
When looking at the luxury brands and stores that didn’t take part in Black Friday, we actually saw negative conversions despite a consistent growth in traffic. This suggests that shoppers were regularly checking these sites for promotional offers and were being strategic in their purchases.
The four graphs below visualise my findings:
Luxury brands involved in Black Friday (blue) vs. luxury brands who opted out (red)
![Traffic of luxury brands involved in Black Friday vs. those who opted out]()
![Conversions of luxury brands involved in Black Friday vs. those who opted out]()
Luxury stores involved in Black Friday (blue) vs. luxury brands who opted out (red)
![Traffic of luxury stores involved in Black Friday vs. those who opted out]()
![Traffic of luxury stores involved in Black Friday vs. those who opted out]()
From my analysis, I came to the following conclusions:
- Overall traffic growth suggests consumers during 2015 appeared more familiar with Black Friday and were more strategic in their bargain hunting
- The consistent growth in traffic yet negative conversions throughout the whole cyber period for advertisers who opted out suggests shoppers were regularly checking whether they would issue a promotion
- There is a growing appetite among aspirational buyers wanting to invest in luxury products after they have ensured they are getting the best price on the market
Communicate your promotions early
My advice to any luxury brand or store that wants to capitalise on Cyber Week is to communicate promotions as early as possible to publishers so they can plan accordingly – advertisers tend to disregard the effort that is required by publishers to plan their promotions. Don’t forget that publishers work the same working hours as advertisers, so informing them of a Cyber Monday offer on Black Friday afternoon is not productive.
Work the increased traffic to your advantage
The fact that we saw a strong traffic increase on advertisers’ sites who were not running any Cyber Week promotions last year, suggests that shoppers are loyal to particular brands and perhaps looking to make purchases on particular sites. If you’re not going to get involved in Cyber Week, then work the increased traffic to your advantage by encouraging your visitors to sign up for your newsletter and communicate any upcoming promotions. If your loyal customers expect a sale soon, they may refrain from making purchases via resellers.
Do what’s right for your brand
This blog post is not intended to convince any advertiser to participate or refrain from running Cyber Week promotions, but simply inform them on the behavioural trends we found on our network.
We have seen many examples of luxury brands having success by taking part in Black Friday, such as Net-A-Porter in the US, but also brands such as Jigsaw and Ted Baker having a strong performance by opting out altogether. Every advertiser is different, so it’s important to look at your data and competitive landscape and, most of all, ensure you keep your customers at the heart of everything you do.
If you’d like any advice on your strategy for Black Friday and beyond, please do get in touch, we’d love to support you.
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