By Steve Briggs, Chief Commercial Officer at SEACOM
With the Black Friday shopping frenzy around the corner, the digital economy this year is expected to receive an enormous boost as many people will want to avoid crowds and take their shopping online. After a difficult year marked by severe disruptions and decreased demand, businesses will also be relying on this period to make up for losses due to the pandemic.
As Black Friday is set to be so different, what can businesses expect to see, and how can they take advantage of these behaviours?
What to expect
The opportunity for increased sales has led to many businesses treating November as ‘Black Friday Month’, giving customers a lot more time to find exactly what they want at the best price. Physical stores may see a lot less foot traffic as customers who opt for the safety and convenience of online retail platforms instead. Adobe predicts that online Black Friday spend in the US will grow by 39% this year. With this massive influx of online traffic, businesses can expect a lot more pressure on their digital infrastructure.
According to Derek Cikes, commercial director at payments fintech firm Payflex, South Africa’s online retail sales grew by around 40% during lockdown. This means many businesses have already made substantial investments into their digital offerings, which should help them manage Black Friday demand online. Digital infrastructure has largely moved onto the cloud and we should see fewer websites crashing this year because of innovative traffic solutions such as website stress-testing and online queuing systems.
Black Friday’s big challenges
The fulfilment of these sales, however, could come with logistical challenges. Businesses that experience a sudden increase in online sales may struggle to scale their supply chains, storage capacity, or delivery services to meet customer expectations. Thus, preparations for meeting consumer demands should be both scalable and practical.
The move to online platforms has created challenges, and some brands have overcome these challenges better than others. Mobile optimisation, for example, is more important than ever, with 42% of shopping in the US expected to happen on smartphones this holiday season. Research by Google indicates that 53% of visits are abandoned if a mobile site takes longer than three seconds to load, making a reliable web host critical.
Black Friday’s bigger opportunities
It should be easier now for small businesses to enter the lucrative online market. An abundance of accessible off-the-shelf platforms hosted with hyper-scalable systems and marginal transaction fees mean that small retailers can reap all the benefits of the digital economy without massive start-up costs. Choosing reputable cloud and web-hosting services is the most reliable way for businesses to establish their online presence while keeping things scalable – and affordable.
In the long run, online retail offers many benefits to businesses trying to reach the right audiences. Customer data platforms have created new avenues for targeting and understanding consumer behaviour. This data can be pulled from multiple sources and analysed to optimise marketing strategies and create a more personalised customer journey. For customers who bought electronics last year, for example, it would be more effective to advertise related products to them in the future.
Laying the digital foundations, like building a website for ecommerce, is usually not enough of a digital strategy. Digital retailers often run into catastrophe during Black Friday when their websites crash or phone lines clog up, which is why small businesses also require flexible solutions that scale easily to meet a sudden increase in demand. Chatbots and AI, like local platform Clevva, offer a scalable yet personalised customer experience.
Cybercrime on the rise
With many people unfamiliar with online platforms stepping into the market for the first time, cybercriminals are going to be capitalising on the consumer craze through fake ads, illegitimate payment platforms, and limited-time offers that seem too good to be true. It is vital that shoppers make sure they’re on a trusted and official website.
Even if consumers see a padlock next to the URL, or the “HTTPS” to indicate that a website has been authenticated as secure, their money and data may still be at risk. On mobile, URLs are even more likely to be hidden and should always be used with the same caution. Companies have a role to play in educating consumers about these risks to help keep them safe.
Although national employment figures and disposable incomes are at a low, Black Friday spending could give digitally enabled businesses the sales they need to make up for the earlier part of 2020 and to survive the year. With increased Internet traffic and customers looking to spend over this period, small and large businesses that offer great digital experiences stand to win.