Australians ready to shop, but retailers sent a warning


“Black Friday has changed the cadence of how Christmas sales progress,” Mr Raymond said.

“We’re having a period where November is very strong for retailers, and then the first three weeks of December are very quiet, but then the run into Christmas is still quite big.”

It’s a risk. I don’t think companies can afford to be offering that same level of discounts or promotional activity for the full five weeks.

Morgans analyst Josephine Little

This has changed the Christmas shopping period from a gradual lead-up to a pre-Christmas rush into a “nuanced” period of fluctuating sales, he said.

According to Morgans analyst Josephine Little, this situation has presented retailers with a “double-edged sword” where companies can lock in more trade early in the season at the risk of being sucked into an extended period of discounting.

“It is a risk,” she says. “I don’t think companies can afford to be offering that same level of discounts or promotional activity for the full five weeks.”

“But you have to be involved or you risk losing share. You can’t just sit back and hold on to that margin.”

Redbubble chief executive Barry Newstead says the retailer has been forced to discount for longer due to struggling traditional players.

According to Barry Newstead, chief executive of listed online marketplace Redbubble, discounting marathons from November to December are becoming more commonplace.

He pins the blame for this on struggling brick-and-mortar retailers, who are forced to aggressively discount to lure customers in from online sellers.

“It’s expected that retailers give customers good deals on the Black Friday/Cyber Monday weekend, but the change we have seen, as offline retailers continue to struggle, is that they tend to run big discounts right through the season,” he said.

“We’ve had to incorporate this into our promotions strategy for the last two-to-three years.”

Premier retailers prepared

In past years, some companies had only “dipped their toe” in Black Friday sales Ms Little said, but this year she’s expecting almost every major retailer to participate in one way or other.

Even non-traditional players such as Woolworths and Coles have jumped on board, with the supermarkets running opposing sales on chocolate and cosmetics.

Data from comparison site Finder suggests Australians are set to spend $3.9 billion over the sales weekend, and both analysts are confident premier discretionary retailers such as JB Hi-Fi, Harvey Norman and Kogan are well-prepared to benefit from the sales blitz.

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“A business like JB Hi-Fi would have been researching their cyber event proposition for months and months and will be quite confident how they’re going to execute it,” Ms Little said.

But with retail facing a tough spot and global trade tensions still present, Ms Little says consumers may have to settle for smaller price cuts than usual.

“With a lot of retailers facing a lower Aussie dollar, we’re not expecting a significant increase in the depth of discounting versus last year,” she said.

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