Black Friday to Cyber Monday: what you need to know
Yesterday was Cyber Monday, the biggest day of the year for online shopping, marked by 24 hours of discounts and deals. This spending caps off a four day shopping extravaganza for millions of customers across the UK. This Black Friday, shoppers spent an estimated £86 billion. Online spending increased by 300% in the early hours of the morning alone, compared to other days of the year. The heady combination of tempting discounts and the imminence of Christmas has had hordes of us rushing to hand over our cash in the past few years. But do events like this really result in the great deals for consumers they promise?
Another Year of huge Spending
According to Barclaycard, the number of transactions processed this Black Friday was up 32% from last year. Online traffic between midnight and 6am on Friday morning was also up by 40%, suggesting that shoppers are getting up earlier and earlier to make sure they get the best deals.
Although Black Friday sales have only been imported from the USA in the last few years, more and more retailers have been jumping on the bandwagon, from online giant Amazon, to department stores, to supermarket chains such as Tesco. According to the auditing company, PwC, “Anything that helps to encourage consumers to go shopping and supports the retail sector is a good thing”. However, not all retailers are convinced that Black Friday sales are good for the economy. Companies which chose not to be involved this year include M&S and Primark. The clothing chain, Fat Face, will not be offering Black Friday discounts either. Chief Executive, Anthony Thompson, has spoken out against the shopping phenomenon, calling it “bonkers”. Thompson believes that these sales simply move consumers’ Christmas spending from December to November, rather than causing them to actually spend more. The large discounts entailed also lower profit margins. However, as more and more retailers embrace the Black Friday ethos, not participating is a risky move as customers could take their business elsewhere.
The Science behind a Shopping Frenzy
Black Friday’s reputation has, in the past, been tarnished by stampeding crowds and physical fights over the latest gadgets – so what causes us to behave this way? According to customer psychologist, Kate Nightingale, “Black Friday is organised around scarcity”. In other words, a limited supply of products increases our perceived value of them. The sense of competition created by crowds jostling for a limited supply of products also encourages us to act more aggressively. When we manage to secure a “good bargain” – real or perceived – we are also met with a sense of achievement. The fact that Black Friday has become a sort of ritual also acts to normalise impulsive spending which benefits retailers.
Adding to our Debt Problems
Despite the savings, Black Friday doesn’t come cheap. In last year’s sales, the vast majority of shoppers did no prior research, heading out with only the vague intention of “getting a good deal”. This leads to compulsive spending and, often, dipping into debt. In a survey by Opinium Research, only one in five men, and one in ten women, hit the Black Friday sales with an idea of how much they wanted to spend. Worryingly, 1.4 million shoppers went into debt in order to purchase something on the day. Credit card use was also unusually high, with 15% of young adults, aged 18-35, putting their shopping on a card. Pressure to spend in the run up to Christmas can be immense, and can both exacerbate and trigger debt problems. According to Money Advice, the average British family spends over £800 on Christmas each year.
The single best way to avoid problem debt in the run up to Christmas is to plan well in advance. Money Advice has a useful Christmas Money Planner which is a good place to start. Saving a manageable amount every moth throughout the year is far easier than trying to find all your Christmas money at once – keep your eyes open for reward and cash-back schemes which could help too.
According to the consumer group, Which?, 60% of products in last year’s Black Friday deals were actually the same price or cheaper at other times of the year, the Black Friday sales are not your only option for saving. You can use Camel Camel Camel to track the price of products on Amazon, and see when they were at their cheapest. Remember to check different websites for the same product too.
No Buy Day
Alternatively, you could avoid the current sales altogether, and take part in No Buy Day. The movement started in Canada in 1992, as a protest against the unsustainable consumption which such sales encourage. Their website refers to day as “dystopian”, and encourages people to take a step back, avoid wasting resources on things they don’t need, and instead spend time with friends and family.
Although Black Friday and Cyber Monday sales can mean a boost for the economy, and good deals for savers, they should be approached with caution! Doing your research in advance, and having a clear idea of what you plan to buy, is the best way to take advantage of the deals on offer.
27 November 2017
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