While retailers are bracing for increased sales on Black Friday, economists predict that consumers under financial pressure will opt to bulk-buy and get ahead of their Christmas shopping rather than splurge on big-ticket items.

According to PayU, South Africa’s shopping volume was up 36.64% in the four days leading up to Black Friday in 2021, while transaction values and online shopping volume on the day were up 30% from 2020, with consumers spending a whopping R17-million in just one hour on Black Friday itself.

Tough financial times and the effects of the Covid-19 pandemic, however, saw online basket size down by 22% year on year.

Ashley Saffy, business development head for FNB card division, says the bank saw a total spend of R2.5-billion for Black Friday last year, up 15% on 2020. Top expenditure categories included groceries, clothing, transport and entertainment.

Frederik Zietsman, chief executive of Takealot, says the company saw turnover of more than R280-million on Black Friday (over 24 hours) last year, with 10,000 to 12,000 orders per hour during the peak period between 8am and 10am.

Air fryers were the most popular item last year, with 5,000 sold on Black Friday. Interestingly, the third most popular product last year was KWV five-year-old brandy and the second most popular item by value was the Sony Playstation 5 bundle.

“We have seen a deflated Black Friday over recent years due to the Covid effect, especially with retailers running monthlong campaigns. This year, we think there will be a stronger performance on the day,” says Zietsman.

“Historically, the company has seen 4,000 to 5,000 orders between midnight and 1am on [Black Friday], but expects the number to jump this year on the back of a ‘live shopping’ campaign on social media platform Instagram. Every hour there will be a 15-minute slot where Takealot will issue coupon codes to the first 100 to 200 consumers who interact with the Takealot account. The coupons can be used for an added discount, over and above the Black Friday sales prices, on specific items.

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“Throughout the year, we run periodic scale testing on our systems from the distribution centre to IT capabilities and our payment platforms as part of the run-up to Black Friday. Black Friday is twice as big as Cyber Monday, which hasn’t yet got the same traction [here] as it has in the US,” he says.

Despite the optimism of retailers, retail analyst Chris Gilmour was somewhat scathing.

“Black Friday is a big con in my opinion. The event has been going for about a decade in South Africa now and has degenerated into sales of commodity-type products such as baby diapers. Rarely do you find decent quantities of big-ticket items at vastly reduced prices as you do in the US,” he says.

Pick n Pay’s head of marketing, Andrew Mills, says the retailer will focus on essential everyday groceries, with combo deals. “We’ll have massive deals on everyday grocery essentials such as cleaning products, nappies and toilet paper, as well as fresh produce and items like chocolates and biscuits. We also believe many customers will use Black Friday deals to get a head start on Christmas shopping, and we’ve added deals for this in particular,” he says.

Gilmour says the timing is bad. “What gets spent on Black Friday invariably gets subtracted from Christmas sales as there is a finite amount of cash to go round. In addition, rising interest rates are depressing retail sales growth. The weaker rand means imported goods are more expensive,” he explains.

Zietsman agrees: “I think people are likely to buy during Black Friday to try and ease some of their economic pressure, moving their Christmas shopping forward. We do expect a bigger demand in the consumables category where consumers are looking for value. The platform has also registered an increase in bulk buying via our ‘lot for less’ offers,” he says.

Senior economist at FNB Siphamandla Mkhwanazi notes that depleted household savings, subdued real income growth and generally higher costs of living  are indicative of a household budget squeeze. “We expect household consumption expenditure growth to average 2.9% this year from 5.6% last year. In the near term, sales could be temporarily supported by Black Friday and festive season-related spending.”

Nedbank’s managing executive of solution innovation, Dayalan Govender, says the bank stress-tests its systems ahead of Black Friday.

“During 2019, we did experience for approximately 30 minutes a slowdown in responses on domestic payments. This was an isolated incident and has not been experienced subsequently,” he says.

Nedbank says shopping app Avo has already seen a rise in the number of average daily transactions since the start of November. Average transactions are six times higher than in October, due to online consumers shopping for deals throughout the month, as online retailers consider a Black November as opposed to just a Black Friday.

Standard Bank saw growth of 19% in spend last year on Black Friday. “We are expecting an increase again this year, however it might be somewhat subdued due to increases in interest rate and overall cost of living. Around 15% of our point-of-sale transactions last year were online or e-commerce and almost a quarter of all card-present purchases were made using contactless technologies,” says spokesperson Ross Linstrom.

The country’s largest grocery retailer, Shoprite, has all systems ready, from IT to alternative energy supply to beat load shedding. “We are ready, our systems are ready and we do not anticipate any issues,” says Debbie Cunningham, head of digital at Shoprite. DM168

This story first appeared in our weekly Daily Maverick 168 newspaper, which is available countrywide for R25.