Black Friday 2022 is just around the corner, and while businesses are trying to prepare themselves, it’s difficult to know what to expect, especially with inflation, a soaring fuel price and loadshedding added as both a frustration and a concern.
Consumers don’t have the disposable income they once enjoyed before the pandemic. Budgets are tighter and the hunt for the best deal and best value is more urgent than in recent years. However, based upon data collected by PayU, online merchants can still expect about a 10% growth in e-commerce this Black Friday, despite the current climate.
PayU CEO, Karen Nadasen predicts, “Following the trend from 2020-2021, we expect about a 10% growth despite the current climate – and this is a conservative estimate. Similar to last year, consumers will be looking for bargains on luxury items such as beauty and fashion. COVID-19 accelerated e-commerce by 400% and we now have 25 million consumers shopping online. The local market also benefits from a diverse payment portfolio, and greater stability of many of these platforms, which have been enhanced over a number of years to cater for peak traffic.
“However, we also saw smaller basket sizes, albeit higher volumes, from 2020-2021 and predict this trend will continue. As economic pressures persist I think consumers will be spending wisely” she added.
Online merchants are also realising that they cannot all compete on the same day and are instead focusing on a week of sales or even a month with some brands opting for ‘Black November.’ Therefore, brands can expect to play the long game with their customers while trying to make the most out of smaller budgets through plenty of planning ahead of time.
Another spanner in the works for e-commerce brands has been the recent set of fuel price hikes that not only inflate prices but also affects the cost of delivery. This pushes consumers even further to scour for the most valuable deal. Value matters.
After the pandemic, having a dominant and powerful online presence is also no longer a luxury, but a necessity. Retailers can not only expect an increase in sales online but also prepare to use their online presence to influence offline sales. Reports indicate that “some 61% of consumers go online to compare products and pricing, while 46% regularly go online to get ideas and discover products before heading in-store to purchase.”
Brands can also expect consumers to be sharper than ever this Black Friday. After a few years of learning the ins and outs of online shopping as well as having a tighter-than-usual budget, consumers are no longer falling for brands’ tricks and so-called ‘deals’. Consumers want only the best value, and because of their large array of choices with competitive promotions, they’re willing to take the time to find the best buy.
It is essential that merchants focus on offering real value to their customers, as well as ensuring their customer experience is seamless from end to end. They can provide this in a number of ways:
Vital considerations for online merchants are the sudden rush of sales and how this could potentially impact payment processes during the peak of Black Friday when most sales are made.
“While banks and credit card operators seem confident in their ability to manage any rush, there are concerns that small cogs in the process provided by new fintechs could be overwhelmed,” states Alistair Tempest, CEO of the Ecommerce Forum of Africa. “Therefore, using the tried and tested payment partners is important.”