Esade experts forecast increased spending this Black Friday despite smaller discounts
Consumers are likely to bring forward their Christmas shopping this Black Friday due to fears caused by the global distribution crisis, predicts Pedro Rey, an economics lecturer at Esade. Black Friday on 26 November is usually the starting signal for Christmas sales, a period during which a major part of annual sales take place. Consumer behaviour expert Pedro Rey predicts a good sales campaign this year because: “physical shops are again hosting Black Friday, and despite recent news, a possible end to the pandemic is within sight”. All of this, he says, will contribute to more consumer purchases during the sales.
Esade economics lecturer Pedro Aznar says there are several economic factors to consider when predicting the success of this year’s Black Friday: “Although recent restrictions in some European countries to control the effects of Covid-19 call for caution, the hope of recovering some normality this Christmas may drive strong demand. There is a desire to celebrate Christmas in a way that is closer to what it was before the pandemic”. He explains that key factors are inflation and supply shortages: “Households generally have a high savings rate, but they are hearing about price rises and shortages. These factors can lead to a better sales season because consumers are more attracted to bargains and good prices”. Finally, Aznar adds that the pandemic has changed consumer habits: “more shoppers are also shopping online”.
Online purchases will arrive late
Distribution is a challenge for this Black Friday, says Esade lecturer and retail expert Jaume Hugas: “There is a lack of logistic capacity, and this means delivery delays in Spain for Black Friday. This also happened in the three previous years when the large logistics operators were able to manage on Black Friday but suffered meltdowns on Cyber Monday – the following Monday”. Jaume Hugas also predicts that price discounts in 2021 will be lower than last year, mainly due to four factors: ‘the ongoing disruption of global supply chains, the lack of surplus stock, rising material prices, and price inflation’. Although these factors also tend to dampen demand, Hugas says: “this is not going to happen and there will again be shortages and delays. As shopping activity peaks this year it will reach almost five times the usual demand level – partly because buyers are going to bring even further forward their shopping for Christmas and Three Kings’ Day”.
