Black Friday no silver bullet as November online sales growth falls below average

Despite online sales being up 11.7% year on year this Black Friday, online sales for the whole month of November were only able to reach a below-average growth level.

According to the latest figures from the IMRG Capgemini eRetail Sales Index UK online retail sales were up +11.5% year-on-year during November, which was notably below the November growth average for the past four years (+18.3%), but is in line with the generally lower rate of growth recorded throughout 2017. November’s overall year-on-year growth was also lower than the 12.7% average of the last three months (Sep-Nov).

The data reveals that medium-sized retailers (those whose websites generate between £10m-£100m a year) tended to secure the highest share of sales growth overall, while the results from the large retailers (those whose websites generate more than £100m a year) were more mixed.

IMRG believes that the high level of discounts available throughout the month, and not just during the Black Friday discounting period, will have impacted overall revenues. Some categories, such as electrical, were in fact down year-on -year.

Bhavesh Unadkat, principal consultant in retail customer engagement, Capgemini explained: “Year-on-year performance is down across key categories, reflecting the continuation of a tough year for e-retail. While the Black Friday window offered a small spike in performance, it was nowhere near as impactful as the industry would have hoped. The growth in average basket value actually supports this, with ABV being up across most sectors. Its figures essentially serve as a proxy for discount levels – implying that customers are downgrading on brand or price point but increasing the volume of items included within their baskets.”

Justin Opie, managing director, IMRG added: “Black Friday is all about discounting in the mind of the shopper and it’s perhaps unsurprising that, while ordering activity is high over that period, revenue growth is struggling to keep pace over November as a whole due to the long lead-in to the Black Friday period. It does raise a question regarding how retailers can actually assess success over that period.

"On the one hand, securing share of sales away from their competitors is obviously always important to retailers, but it might be that the measurement of success over the Black Friday period is less about order volumes and more about the longer-term view – how new customers acquired can be converted into regular, loyal, higher-margin customers through the quality of the follow-up marketing after the discounting peak is over.”