Local ShoppingWinners and losers of Black Friday 2022

Winners and losers of Black Friday 2022

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As COVID-19 pandemic restrictions cooled off in 2022, many retailers may have hoped for a less complicated Black Friday this year.

But brewing up a new battle for both brands and consumers, inflation took the stage months before the shopping event began.

Heading into the holiday, some estimates showed that while in-store shopping could make a return, inflation (which was up 7.7% in October according to the Consumer Price Index) could thwart consumer spending, as shoppers expected to get less for more money. 

Predictions showed higher-income shoppers tightening their budgets, and discretionary spending at some big retailers decreased throughout the year as consumers dealt with rising grocery bills.

Several retailers lowered their outlook for this quarter before the shopping event even started. Target tightened its Q4 outlook in November after earnings came in below expectations, and e-commerce native ThredUp did the same despite its focus being on secondhand goods  a category that could normally do well for consumers looking to save.

All of this laid the groundwork for a not-so-joyous holiday season for shoppers. That said, Adobe Analytics data shows that online spending on Black Friday this year reached $9.12 billion, up 2.3% year over year. 

The picture of how the retail industry performed is more complex than a single number. Given the macroeconomic pressures consumers face right now, it is hard to say that any winners in retail will remain so for the rest of the season. But some trends stood out.

Here’s how retailers actually fared during the industry’s most highly-anticipated holiday.

Winner: Buy now, pay later … sort of

Thanksgiving and Black Friday may have been great days to be a buy now, pay later service provider. Given the economic pressures many shoppers face right now, BNPL payment options offered a way for consumers to still get the goods they wanted.

Black Friday predictions from Deloitte projected increased use of these services, with 48% of survey respondents saying they planned to use credit cards and 37% expecting to use BNPL.

On Thanksgiving Day, online BNPL revenue increased by 1.3% year over year and orders were up 0.7%, according to Adobe data. More telling is that some shoppers are using BNPL for lower-priced goods instead of high-ticket items, with the average order value for BNPL purchases decreasing in the U.S. by 6% on Thanksgiving, according to data from Salesforce. 

Orders using BNPL rose by 78% the week of Nov. 19 to Nov. 25 when compared to the week before, according to Adobe. Additionally, overall revenue from BNPL is up 81% during the same period.

“It’s a positive sign in the immediate term, that consumers are looking to extend their wallet further and do more,” Rod Sides, global leader at Deloitte Insights, told Retail Dive.

But that immediate-term positive is a red flag in the long term, according to Sides, who added “we now have much higher interest rates, and they’re gonna start to hit any credit card balances. With buy now, pay later, it tells you the consumer is challenged … in the long term, it’s a warning sign.”

Loser: Long lines

The days of long lines and fights over highly sought-after products may really be dead.

While in-store shopping was more in focus this year due to loosening COVID-19 restrictions, that doesn’t mean there was a return to the old chaos of Black Friday shopping. Several analysts noted that traffic was brisk and certainly apparent at a variety of stores, but didn’t have the long wait lines the holiday used to be infamous for.

“People have been shopping today. We’d expected brisk traffic and big sales numbers. We got the brisk traffic, and we’ll soon know if that translated into positive numbers for the retailers,” Katherine Black, partner in the consumer practice of Kearney, said in emailed comments Friday evening. “In Raleigh, [North Carolina] we visited a wide range of stores (Target, Best Buy, Macy’s, Bass Pro Shop) and while all of them had shopper traffic, none of them had early morning lines, or completely full parking lots or long lines.”

The avoidance of such lines this Black Friday could have contributed to the use of BOPIS, according to Salesforce, which said the service option was trending 20% higher on Black Friday compared to all other days this season.

With e-commerce still strong this year, Sides thinks it can still go head-to-head with in-store shopping as consumers’ preferences settle in after the highs of the pandemic. 

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