The Black Friday sales are set to provide retailers with strong results in the lead up to Christmas with research from the Australian Retailers Association in collaboration with Roy Morgan forecasting sales to reach a record $6.2 billion over the four-day Black Friday and Cyber Monday weekend – happening Friday 25 November to Monday 28 November 2022.
Australian retailers will benefit from the early sales momentum as Aussie shoppers aim to make their purchases ahead of price rises and continued supply chain disruptions.
The Black Friday sales are the biggest pre-Christmas event on the retail calendar and its popularity is continuing to grow in Australia. After starting off as an American shopping tradition, the Black Friday sales have become a global phenomenon and millions of Aussies are set to take part. The event is renowned for having the biggest pre-Christmas bargains and this year will be no different. We’re expecting huge amounts of traffic in-stores and online, with sales to reach $6.2 billion this year – an increase of $200 million on 2021,” ARA CEO Paul Zahra said.
Around a quarter (25%) of Christmas shopping is completed in Black Friday week alone with a third (33%) already completed in the first three weeks of November according to Salesforce’s Holiday Insights Hub, showing how Australians love a bargain and are shopping earlier to avoid disappointment. The Salesforce research also shows the average discount rate will be highest during Cyber Week, averaging 22%.
We know that many people are more conscious about their household budgets with the cost of living going up and interest rates on the rise, so the Black Friday sales are an ideal time to complete your Christmas purchases, save money and ensure that your gifts are delivered on time… “There’s no doubt it’s a challenging economic environment, but what’s pleasing is that retail sales overall are currently at record levels. The impacts of rising interest rates and inflation have yet to slow household spending and we’re forecasting upbeat trading with pre-Christmas sales forecast to reach nearly $64 billion – a 3% increase on last year.” said Mr Zahra.
MST Marquee’s Outlook for Black Friday 2022
Over recent years promotions have started earlier with a rapid embrace of offshore events like Black Friday. Achieving a good November and December can make or break a retailer’s year. MST Marquee are expecting earlier and bigger promotions this November, but it’s not a sign of desperation. These promotions are planned and aimed at stimulating sales. Even so, given huge November events in 2020 and 2021, it will be hard to deliver more than 3% sales growth. With a swing back to stores this year, December is expected to be stronger.
Most Australian retailers now promote Click Frenzy (8-10 November), Singles Day (11 November), Black Friday (25 November) and Cyber Monday (28 November). It’s been a rapid embrace of offshore promotional events in recent years. As a result, November 2021 was 46.4% of the combined Nov-Dec sales up from 43.0% in 2016.
What about online?
There was an outsized rate of sales growth in both November 2020 and 2021, particularly online. In non-food retail, online sales were 21.4% of all sales in 2021, up from 11.1% in 2019. More broadly, online penetration is normalising. Online sales (non-food) may decline this November, but stores will do better. November sales are expected to show year on year growth of -1% to +3% in non-food.
Want to hear more? Take a listen to this Christmas podcast bonus episode: Spending predictions and retail trends
We’re pleased to welcome Fleur Brown, Chief Industry Affairs Officer at the Australian Retailers Association, to the Retail Therapy podcast to discuss pre-Christmas and Christmas spending predictions.
The holidays are fast approaching and retailers are in preparation mode for the Christmas shopping rush. There’s lots of challenges facing our industry in terms of supply chain and staff shortages, but plenty to be optimistic about from a sales point of view.
At the ARA, we’re fortunate to have an incredible network of strategic partners and that’s allowed us to produce the most comprehensive Christmas insights in our history. We explore these insights, plus more, in this first episode of the Christmas Special Series for 2022.
This episode explores:
- Consumer spending forecasts from Roy Morgan
- The impact of rising inflation and interest rates
- Black Friday – are consumers shopping earlier?
- Staff shortages in the retail sector, as well as supporting industries