Singles Day, Black Friday and Cyber Monday are just around the corner but with spending down across all retail channels thanks to high inflation, rising interest rates and a sluggish housing market many business owners are wondering if 2022 will follow suit with the record-setting sales of the peak pandemic years.
The pandemic fuelled an online shopping frenzy globally in 2020, seeing eCommerce spending skyrocket. Kiwis spent a total of $5.8 billion online alone in 2020. Despite predictions that a recession was looming, the golden fourth quarter saw Kiwis spending up large online and instore in both 2020 and 2021 smashing previously held sales records. The first half of 2022 followed suit with online spend up 11% year-on-year and up an astonishing 81% compared to the first half of 2019. However, as inflation hits 30-year highs consumers have started shopping less frequently. Online spend dropped 4% and instore spend dropped 5% in the second quarter of 2022 compared to 2021. It's important to note that spend still tops that of the pre-pandemic years however, with online spend up 8% compared to 2019.
Will cautious Kiwis dust off their wallets again this November for the big three retail days? Read on for our predictions and tips on making the most of these shopping events:
November 11: Singles Day
This phenomenon is known globally as one of the biggest retail days of the year, but is almost entirely overlooked by Kiwi Retailers. In fact, in 2019, 76% of Kiwis claimed they've still not heard of the shopping festival.
What is Singles Day?
A movement that began as an anti-Valentines Day protest by single Chinese people in the 1990s, has steadily grown into a globally celebrated occasion over the past three decades and one of the biggest retail days. If you've got a keen eye for detail, you might have noticed that the date that Singles Day is celebrated (November 11th) is written as 11.11, or "one-one-one-one" - which is no coincidence.
However, Singles Day really picked up traction in 2009 when retail giant Alibaba commercialised the holiday, with 17 retailers offering discounts to customers in celebration of the event. In 2020 the total value of orders across Alibaba’s shopping platforms totalled $74.1 billion.
Our 2022 spend prediction
Despite the global notoriety, there's a reason that you might not have come across the term 'Singles Day' before - it's not as widely celebrated by New Zealand retailers compared to Black Friday, Cyber Monday and Christmas / Boxing Day. Singles Day is technically the fastest growing of the 3 big retail days. Last year Singles’ Day recorded $30.8m in online spend in NZ, less than the other big November retail events but up 30% on the same day in 2020.
This year we predict Singles Day spend will top 2019 figures, but will struggle to reach the highs of 2020 and 2021 as Kiwis hold back their hard-earned cash for the more popular Black Friday and Cyber Monday specials.
How can retailers make the most of Singles Day?
Don't just take our word for it though! The key to Singles Day success is understanding your niche and appealing to the Chinese domestic market. There's still a real opportunity to make use of this international retail holiday and be one of the few merchants in New Zealand to harness the market power of the trend.
1. The first way to make the most of the holiday is simple: promote it. We'd suggest creating a campaign around the holiday and marketing discounted prices or a holiday-specific sale to appeal to a Chinese audience (ideally with a Kiwi audience crossover). If you have an online store, this is particularly relevant as you'll be able to take advantage of the volumes of customers searching for Singles Day - which is a lot of traffic.
2. Get onboard with WeChat Pay and Alipay as payment solutions. If you haven't yet check out our blog on the power of Alipay in attracting Chinese customers and growing you're average spend.
If you're interested in finding out how easy it is to enable WeChat and Alipay acceptance on your EFTPOS terminal, you can find the details here.
November 25: Black Friday
Towards the end of November each year, retailers are impacted by one of the more popularised American retail days, 'Black Friday'. Unlike Singles Day, Black Friday is somewhat more notorious and recognised in New Zealand.
What is Black Friday?
The given name for the day after Thanksgiving in America is 'Black Friday' and has been used to officially mark the beginning of the holiday shopping season, leading up to Christmas. However, the term itself was popularised when a story appeared in print in 1966 in The American Philatelist (a stamp collectors magazine), and was adopted by the Philadelphia Police Department to describe the traffic jams and crowding in department stores.
Since then, the commercial holiday has globalised and is now celebrated as an opportunity for keen shoppers to take advantage of unheard-of savings in their favourite retail stores, with the holiday no longer just limited to a single day, but often extended across up to three days (the whole weekend).
Our 2022 spend prediction
Last year Black Friday beat out Singles Day ($30.8m) and Cyber Monday ($39.5m) with the biggest online spend ($39.8m). According to Worldline data, instore and online spending totalled $248.2 million in the four days from Black Friday to Monday, 29 Nov. The biggest online shopping day was actually the Wednesday before the event itself as businesses offered their discounts early to capture as many eager shoppers as possible. This year we think the trends will continue as Kiwis that may have held back over the past couple of quarters are enticed by the deep discounts on offer. We think Black Friday will be the biggest spending day of the 3 big retail events, but spending likely won't hit the highs of 2020 and 2021.
How can retailers make the most of Black Friday?
If you're a Kiwi Retailer looking to get onboard with the Black Friday retail trend, here's what you need to know.
1. Plan a sale and make the most of foot traffic and online searches. The idea underpinning Black Friday is 'unbelievable discounts', with 42% of Kiwis expecting savings of at least 30-60%. It's all about communicating a sense of urgency and setting prices that are available for a very specific and limited time, that wont be repeated again. This year more than ever it's critical to put your best pricing forward as cash-strapped shoppers will be eagerly shopping around for the very best pricing.
2. Traditionally, Black Friday implies that savings will be found in-store, rather than online (although many retailers do extend their offers to their websites). With this in mind, it's really important to make sure that your payment solution is running efficiently and ready to go before the day arrives. If you haven't already considered contactless payment as a solution, now's a good time to get it done. Remember, the smoother the experience at the till, the happier the customer - and who doesn't love repeat business?
November 28: Cyber Monday
Originally coined in 2005 by the National Retail Federation and quickly becoming one of the biggest online shopping days of the year, Cyber Monday was created with the intention of allowing shoppers an alternative way to take advantage of pre-holiday deals, without having to battle the crowds instore.
What is Cyber Monday?
Initially, Cyber Monday was positioned as Black Friday's online sister, and set to occur the first Monday following Thanksgiving every year. However, with the competitive nature of retail, these dates have begun to blur a little as some stores extend Black Friday sales all weekend long. In fact, last year the sales seemed to dominate the entire month of November.
The popularity of Cyber Monday in NZ is most easily tracked by the volume of customers logging in and making online purchases year-on-year. In fact, NZ Post’s The Full Download 2021 report showed that Kiwis are shopping online more often and spending more, with online shopping ‘holidays’ such as Singles’ Day, Black Friday and Cyber Monday becoming a major factor in our online shopping habits.
Our 2022 spend prediction
Online spend may be down in the second quarter of 2022, but remains relatively strong overall and still continues to top pre-pandemic levels. We think that Cyber Monday will still closely follow Black Friday in total spend amount.
How can retailers make the most of Cyber Monday?
If you're an NZ business looking to boost your sales through Cyber Monday, there are a few strategic points to consider:
- Firstly, if you haven't already expanded your sales options from in-store only to also available online, the statistics that support making the transition to an online domain speak volumes.
- If you do have an online store, make sure that you're marketing your online store and your Cyber Monday discounts as early as possible, to direct traffic to your site. Get people excited beforehand and give cash-strapped Kiwis the opportunity to budget ahead.
- Remember, people are shopping around for a deal and are geared up to take advantage of these retail events. Implement tactics to encourage impulse buys and upsells by creating the perception of deep discounting and exclusivity.
- Finally, while offering deep discounts will attract more eager shoppers to your website, it's obviously not great for your bottom line. We recommend looking at ways to sharpen your profit margin. For example, take a look at your cost of processing transactions online and review whether another provider might be more affordable. Check out our pricing here.
Don't have a website yet? There's still time to get online! Download our eBook on the 5 steps you need to take to get a business website launched fast.
Editors note: blog content updated on September 29, 2022