Black Friday: Consumer psychology of grabbing a bargain

This year, online sales over the 24-hour Black Friday period are expected to surpass £1bn for the first time in UK history (last year they were £810m). £3.5bn in sales are expected over the whole weekend. For retailers, Black Friday is a huge sales opportunity but also creates pressure to keep up with the Joneses and discount items to an uncomfortable level. Combine this with the instore chaos we saw in the UK last year and it’s a pretty crazy time!

For Americans, Black Friday symbolises the start of the Christmas holiday shopping season. They take the Friday after Thanksgiving off from work, taking advantage of the long weekend to start their Christmas shopping.

Although Black Friday is still not very popular in Europe, in the UK it has very quickly become the biggest shopping day of the year, even beating Boxing Day.

The figures speak for themselves…

In 2014, UK consumers spent £810m online on Black Friday and they are expected to spend even more this year. According to IMRG & Experian, online sales will reach £1.07bn. If that prediction is correct, online sales will reach a record in the UK’s online retailing history, exceeding for the first time £1bn in just 24 hours.

The Centre for Retail Research estimates that in total (combining online and in store shopping) British people will spend £1.39Bn in just one day, this is 32% more than the previous year.

Telegraph, 23 November 2015. http://www.telegraph.co.uk/

Who are Black Friday Shoppers?

First of all, let’s understand who are Black Friday typical shoppers: (IMRG 21 October 2015, http://www.imrg.org/)

• Typically families with children
• Aged between 35-55
• Living in suburban or residential locations; they don’t have easy access to shops
• Facebook users
• Regular consumers of content on mobile devices

Compare this with Boxing Day shoppers who are more likely to be younger and live in urban city centres.

Their demographic profile has important implications for retailers. For example, considering that the most Black Friday shoppers don’t live in the city centre and don’t have easy access to shops, attention should be put in to planning and optimising the delivery service or in communicating details about deals, coupons, opening times, etc, through social media, to enable costumers to plan and organise their shopping.

How are Black Friday customers shopping?

(Simpson L., Taylor L., O’Rourke K. and Shaw K. (2011). An Analysis of Consumer Behaviour on Black Friday, American International Journal of Contemporary Research, Vol. 1 No.1)

• They already have a specific product in mind
• They buy particularly electronic media items
• More willing to buy gift items rather then items for themselves

This year, consumers will be even more aware about the convenience of buying on Black Friday and shops will be even more crowded than last year, lines outside will be longer and tension will grow faster among the more competitive ones.

Last year, Black Friday was definitely a success, but retailers weren’t ready to deal with, quite frankly, the chaos that ensued amongst consumers, to the point that some of them have decided not to take part again this year. One of the most surprising retailers not taking part this year is American owned Asda, who will instead offer discounts spread across November and December.

Daily Mail, 28 November 2014, Manchester.
http://www.dailymail.co.uk/news/article-2852585/Mayhem-Black-Friday-begins-Shoppers-clash-supermarkets-trying-grab-bargains-Boots-Game-Curry-s-PC-world-websites-crash-thousands-start-hunt-Christmas-deals.html

Copyright LUKE MACGREGOR

Why is Black Friday more aggressive than other UK sales days

Last year, the situation got so chaotic that Telegraph renamed the day as “The Black and Blue Friday”. People queued in the cold outside shops for hours, then running and fighting their way to the product they wanted. But it’s not like this on Boxing Day or any other sale day in the UK…

So, what’s transformed the decent and respectable UK shopper into a merciless shopping, fighting machine?  Frustration can be a reasonable answer.

A lot of psychologists tried to find explanations and causes of aggressive behaviours and the Frustration-Aggression Theory (Dollard, Neal, Miller, at al. 1939; Berkowitz, 1969) is one of the hypothesis proposed to explain the phenomenon. The authors support the idea that when people perceive that they are being prevented from achieving a goal, their frustration is likely to turn to aggression and violence. The closer you get to a goal, the greater the excitement and expectation and consequently the more frustrated you get by being stopped.

The theory doesn’t suggest that frustration always lead to aggression, but in some particular circumstances can boost aggressive behaviours.

Black Friday might be one of those above mentioned circumstances.

Sales psychology: Why sales drive shoppers

Psychologists say that the allure of a bargain speaks to our human nature. Limited-time offers and last chance buys trigger the fear of scarcity and Fear of loss that drive us to buy. It makes us buy things we don’t really need, simply because we might not have the opportunity to buy them so cheaply again. IT’s how you end up with boxes of shoes in the cupboard that you never wear but you thought were an absolute bargain at the time you bought them with 70% off!

“People truly want to get a good deal, and so they might be less rational… when they can look in the environment and find different cues that make them think they’re getting a good deal, the decision-making is emotional” Kenneth Manning, professor at Colorado State University.

Did you know that sales drive our competitive spirit? We want to tell other about the great deal we got and we hope ours was better than theirs (even if we didn’t really need the item in the first place!). People treat it as a personal accomplishment to boast about.

Sales also have a positive affect our brain chemistry. In 2007, Stanford researchers discovered that when subjects shopping for clothes saw a sale price, the brain’s pleasure centre lit up. Sales, in other words, make us happy.

The sales environment also triggers consumers to part with their cash: “We are classically conditioned to hear this music, see these lights, even the experience of the shorter days and associate it with spending and shopping,” says Dr. Ramani Durvasula, a licensed clinical psychologist

So, be ready, 2015 Black Friday is just around the corner (27th November) and we hope and wish will be a good one, for both shoppers and retailers!