Black Friday saw intense bidding wars between popular brands Temu and Shein, causing online marketing costs to spike. The cost per click for popular Google search keywords surged as these brands competed for visibility on the shopping-centric day. Consumers crowded the Shein Holiday pop-up shop inside Times Square’s Forever 21 in New York City on November 10, 2023.
The heightened competition led retailers to aggressively target rivals’ keywords to outdo each other in online visibility, driving up marketing expenses. The rising marketing costs have come under scrutiny, reflecting the intense race among retailers to capture consumer attention on pivotal shopping days. Helen Reid, a London-based reporter covering the European retail sector, highlights how companies like Adidas, H&M, Ikea, and others are navigating these competitive waters.
Reid also touches upon the increased focus on sustainability within the industry and how investors are pushing for changes in corporate strategies. Most Black Friday shoppers chose to bag their deals online this year, leading to a record $10.8 billion in online purchases. According to Adobe Analytics, shoppers spent over 10% more than they did last Black Friday, with approximately $11.3 million spent per minute between 10 a.m. and 2 p.m.
“Crossing the $10 billion mark is a big e-commerce milestone for Black Friday, a day that in the past was more anchored towards in-store shopping,” said Vivek Pandya, a lead analyst with Adobe Digital Insights.
Pandya attributed the online shopping boom to growing comfort with shopping on smartphones, mobile wallets, and buy now, pay later options.
Temu’s competitive launch amidst rivals
While online sales soared, in-store shopper traffic saw an 8.2% drop compared to 2023, according to Sensormatic Solutions.
However, retailers offering significant discounts, such as Forever 21 with 50% to 70% off, managed to attract customers. Popular Black Friday purchases included makeup, skincare products, hair care products, Bluetooth speakers, headphones, smartwatches, jewelry, clothing, fragrances, bedding, linens, televisions, gift cards, and espresso machines. Despite higher costs and inflation, deeper discounts were seen across various product categories.
Retail analysts expect Cyber Monday to be the biggest shopping day of the season and year, with Adobe predicting a record $13.2 billion in spending, up 6% from the previous year. Electronics and apparel are expected to be hot items, with discounts reaching 30% and 23% respectively. The term “Black Friday” originated in 1950s Philadelphia, coined by local police officers to describe the chaos of the day after Thanksgiving.
Heavy traffic, overcrowding, and increased shoplifting incidents, compounded by the annual Army-Navy football game, led to a day of dread for police officers. Philadelphia retailers attempted to rebrand the day as “Big Friday” to shed its negative connotations, but the effort was unsuccessful. By the 1980s, the term evolved into the shopping holiday we recognize today, taking on a more positive meaning as businesses used it to describe the day their finances shifted “into the black,” indicating a move from loss to profit due to a surge in sales.
Black Friday will take place on November 29 in 2024, continuing the tradition of marking the start of the holiday shopping season with significant deals and sales.
