With retailers being urged to advertise honest and genuine savings this Black Friday, here’s what consumers should be looking out for.
It’s been tough for a lot of businesses this year, but there was some good news for retailers earlier this week when Stats NZ revealed sales had jumped 7.4% year-on-year in the September quarter – the biggest increase recorded in almost 25 years. And while that doesn’t quite make up for the significant Covid-related losses registered in June, it’s a promising trend for retailers with the holiday season closing in.
It’s no surprise then that retailers are pulling out all the stops with an estimated 50% of New Zealanders set to spend an average of $464 on Black Friday this year But according to PriceSpy data from 2019, at least 9% of products listed on the site increased in price the week before Black Friday Week and dropped again on Black Friday to make its deals appear more attractive.
“When we dig deeper across the historical price points of products, we can also see flash sale days, like Black Friday, don’t necessarily offer the cheapest price,” says PriceSpy’s Liisa Matinvesi-Bassett. “Our research found that of the top three products people were looking to buy last Black Friday, all items could be purchased for less prior to the sale day.”
On Thursday, the Commerce Commission fired a warning at businesses urging them to be honest about their deals with consumers. “We’re reminding retailers to make sure that advertised savings are genuine savings, and we’re reminding consumers to do their research, shop around, and check to make sure that they get the deal they think they are getting,” Commerce Commission chair Anna Rawlings said.
“For example, if a business claims a price is 50% off, then their customers should save 50% off the usual selling price … Businesses should not bump up prices ahead of a sale in order to claim a bigger discount at sale time.”
Questions have already been raised over pricing at Dick Smith, with one consumer reporting Apple AirPods being priced at $219 last week, $225 on Tuesday and $229 on Wednesday. On Thursday and Friday, the AirPods dropped back to $225.
When it comes to the discounts consumers think they’ll be getting, it’s clear there’s a significant gap between expectation and reality. On average, New Zealanders expected a 32.3% discount on Black Friday, according to a PriceSpy survey. In reality, the average price drop recorded in 2019 was just 5.1%. Mobile phones, which are regularly one of the most popular items on Black Friday, recorded an even smaller average discount of just 2%.
Black Friday last year also saw a handful of products (10%) actually increase in price. The Huawei P20 Pro, for example, was listed for $749 on Black Friday 2019 but sold for $577 – or almost $172 cheaper – just two weeks prior.
Despite questionable tactics and some less than significant deals, Black Friday still offers the best opportunity for buyers to secure a pre-Christmas bargain. Matinvesi-Bassett says while Black Friday is more associated with tech products, non-tech categories such as beauty and health (9%), home and garden (9%) and fashion and accessories (7%) offered much better average savings.
In addition to the usual pre-Christmas spending spree, there are a variety of reasons New Zealanders seem more than eager to open up their wallets during a global pandemic, including pent-up demand, better online shopping systems, a resilient domestic economy and “nest-building” due to more time spent at home.
According to online shopping platform TheMarket, some of the most popular products ahead of Black Friday include camping and outdoor gear due to more New Zealanders vacationing domestically than ever, and various homewares as people look to make the most of where they currently live. LED light strips, for example, have reportedly had a 700% increase year-on-year, while massagers – particularly handheld ones – have jumped in popularity by more than 30,000%.
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