Analysis

The Long Black Friday: smoking gun or smoke-screen

Why is Black Friday still having such an effect two weeks after it took place?

This time two weeks ago, many people in the UK were boggling at their TVs, as news channels broadcast images of shoppers fighting with one another as they tried to grab a Black Friday bargain.

A phenomenon that lost its newness sometime ago in the US, the Black Friday and Cyber Monday mega retail weekend has tentatively made itself known in the UK in recent years, but 2014 is the year it can be said to have arrived.

According to some estimates £800M was spent on Black Friday and £700M on Cyber Monday – peaks in demand which no doubt put a strain on supply chains.

First, M&S struggled – having to extend its standard delivery time out to ‘within 10 days’ and temporarily withdrawing next-day delivery. More recently, Yodel has announced it was suspending all collections for 72 hours, citing Black Friday and Cyber Monday as the reason. Normal service should resume after the weekend, the courier firm said in a statement.

Unfortunate, perhaps, that on 4 November Yodel announced plans to cope with the Christmas period, in which executive chairman Dick Stead said: “For our retail clients this vital season is known as the ‘golden quarter’ and we are fully prepared for parcel volumes to reach record levels.”

One big-hitter in the European eCommerce sector scoffed at the notion of a two-week Black Friday fuelled hangover, and told eDelivery that in his opinion the volume of business done on Black Friday and Cyber Monday was not beyond the reasonable expectations of anyone in the retail sector.

So, is Black Friday being treated like a get out of jail free card by some whose infrastructures simply weren’t able to cope, not with the volume of business per se, but with the flow-rate of that business?

Dan Wagner founder and CEO of retail and ecommerce specialist company Powa Technologies clearly thinks so. “Shopping events like Cyber Monday, originally a creation of the retail industry and an import from the US, are now moving the milestones of when the peak gift buying season begins, fuelled by the widespread access to smartphones and tablets this year. The delivery infrastructure must now quickly catch up to address this fundamental shift in retailing, for what is the busiest time of year.”

Jonathan Smith, Chairman of InPost UK, concurs. “The trend towards seasonal discounting and last-minute sales is making the Christmas peak even peakier. The increase in online sales and orders as a result of the surge in demand over ‘Black Friday’ Christmas offers have clearly put a large amount of pressure on the ability for retailers to deliver and has presented a series of logistical challenges, shown by the large number of retailers currently experiencing severe delivery delays.

Maybe Black Friday and its sidekick Cyber Monday have shown up areas of weakness within some retail logistics set ups; points of failure may be painful to live with but you have to find them before you can eliminate them. And eliminating them will now, surely, become a priority in 2015.

Maybe the future lies in robots, after all Amazon has already deployed around 15,000 of then in the US and it’s surely only a matter of time before the same happens in the UK.

But for businesses such as Yodel – and others who stumble this Christmas – who have had reported difficulties in the past, the Long Black Friday has the opportunity to be a valuable learning exercise. If they are bold enough to see it that way, that is.