Black Friday knocks out Boxing Day in Canada

Key Findings:

• Black Friday excitement builds in the month prior to the actual day, with search and social chatter leading up to the big event (likely in part because it isn’t connected to a calendar date). The peak for Boxing Day is the day before.

• Black Friday deals last more than a week, as does consumer interest in the sales. 

• Supply chain issues, staffing shortages and inflation were major factors in Black Friday 2022, and may influence prices and activity in 2023.

• Analysis of online conversations show that Canadians are no longer seeing the need to go to a store for deals, when they can buy online.

Recommendations: 

• Focus a greater proportion of the advertising budget on Black Friday, an opportunity for holiday shopping at a deep discount.

• Optimize digital and social channels, especially search.

• Begin advertising deals a month in advance of the actual sales day/week.

• That said, run your sales over a week.

• Due to the inflation/recession, think about multiple sales during the year or advertising lower prices year round.

A deeper dive

Online Search remains key

Analysis of online search activity by Canadians since 2019 shows a greater interest in Black Friday than Boxing Day. In addition, the interest for Black Friday is more drawn out, starting in early November. By comparison, Boxing Day interest starts in the days before the event.

In Canada, the categories that have experienced the strongest search growth are: entertainment, work, well-being and home.  Demand for large appliances, electronics, furniture and other department store staples plummeted after a surge of interest at the start of the pandemic, when housebound shoppers used their cash to upgrade their living space. The combination of intense consumer demand and supply chain disruptions has also driven prices past customers’ budgets.

According to Adobe, online toy sales were up 285% during Black Friday, from the October average, suggesting consumers are using the event to purchase gifts ahead of Christmas.

 Top brands with strongest search growth during Black Friday 2022 in Canada:

1. Amazon

2. Canadian Tire

3. Walmart

4. Lululemon

5. Home Depot

6. Roots

7. Koodo

8. Fido

9. Costco

10. Best Buy

Products with strongest search results during Black Friday 2022 in Canada:

1. Airpods/Airpods Pro

2. Gymshark

3. Nintendo Switch

4. Blundstones

5. Dyson vacuums

6. Lululemon

 Connecting with consumers - social media

Analysis of online conversations in social media show us that in the last two years, Canadians have been talking more about Black Friday than Boxing Day. Boxing Day conversations, however, are very specific to the holiday season.Interestingly, when examining general conversations about Black Friday and Boxing Day, Canadians no longer seem to understand the need to line up, given the ability to shop online. Going to malls seems to be more about the experience (seeing friends, getting out of the house), rather than the chance they may get great deals. In light of the economic situation, there is a common thread in social discourse that deals are needed for food and fuel. Comments to the effect of “there are only so many TV’s you can buy,” perhaps explains why stores selling electronics had more muted numbers this year.Younger consumers are exploring social media platforms as alternatives to in-person or site based shopping.  According to Shopify’s global 2022 Black Friday/Cyber Monday report, 44% of Gen Z’ers surveyed said they would likely make a purchase on TikTok, and 43% said they would buy something on YouTube. Retailers seem to recognize this trend. Shopify stated in the report that 81% of businesses said that social commerce is just as important - if not more than - last year. Ease of execution may also be a factor: 70% of online purchases in Canada were made through a mobile device, according to a SalesForce report.

Black Friday is now a week of deals

Covid transitioned Black Friday from an in-store frenzy to a more civilized online bonanza that stretches over multiple days. High inflation caused consumers to look at their spending more so than before. They keenly researched sales, with price as the primary consideration.By comparison, Boxing Day was a more scaled-down event for many advertisers. This could be due to supply issues including late shipments of products that led to a lack / surplus of inventory at the end of December, and a desire to flatten the demand curve due to the lack of personnel.

Some category examples

Despite pre-Holiday jitters, clothing retailers based in Canada saw their greatest volume of sales on Black Friday, using a concentrated mix of digital and traditional media.  Their second-largest day was Boxing Day / Week, an event sustained more in digital media.  Bad weather across the country didn’t seem to deter in-person shopping.  On the telecom side, entering the market in mid-November ahead of competitors, reducing the number of messages in the market and concentrating the retargeting strategy resulted in a boost in sales conversions. Ads that featured a greater level of variety and focused on gifting were particularly effective. Black Friday itself was the highest sales conversion day of the entire holiday period. Paid search was effective on Black Friday and Cyber Monday, but Facebook performed better on Cyber Monday.

Similar trend in the affiliate marketing space

Black Friday consistently outpaces Boxing Day in retailers' affiliate programs. This year, Black Friday averaged about 45% higher in conversions and 50% higher in revenue than Boxing Day.Retail programs in the affiliate marketing space significantly exceeded Black Friday targets, growing conversions and revenue significantly year over year - by more than 50% in some programs. One key learning - consumers were after big deals, particularly with inflation and threat of recession in Canada. Retailers who continued to offer deep promotional discounts not tied to Black Friday saw an average order value (AOV) drop of 15-20% (YOY).

Price matters

Sky-high inflation had the greatest impact on Canadian consumers in 2022. Although the Canadian economy's decline appears to have slowed in recent months, prices for food, rent, gasoline and other basic necessities remain high. The companies that saw the greatest success on Black Friday offered exceptional discounts of up to 70% off. Millennials were the most avid bargain hunters: 77% said they were more likely to shop to get the most bang for their buck. And 65% of Gen Z consumers were saving more money this year in preparation for the holiday season, according to a global Shopify e-commerce report. The same report found that two-thirds of shoppers (67%) said that despite the financial crunch, they still plan to indulge each month on small purchases that bring them joy, presenting an opportunity for companies whose products provide daily pleasure in times of uncertainty.