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Black Friday: How to successfully expand your cross-border customer base

Image of mobile payment for black friday - expanding your cross-border customer base

By Sangeetha Narasimhan

Since Black Friday seems to change character every year, it’s worth taking a regular look at how shoppers perceive and respond to it.

Sales figures form a significant part of the picture, and tell you how retailers performed, but there’s a great deal else to help gauge the mood of shoppers towards the event.

This article will consider what we can find out about shoppers’ current relationship with Black Friday.

Black Friday: A week-long festival of online shopping

Black Friday is not the one-day high street bonanza it once was. Our payment data unveiled a near week-long festival of ecommerce, with Wednesday 22nd – Monday 27th November registering as the six busiest shopping days of 2017. Sales peaked on Black Friday, where UK shoppers spent a huge 515% more online than the average Friday in 2017 and nearly double that of Cyber Monday.

Cyber Monday was still one of the biggest ecommerce days of the year, but it was overshadowed in 2017 by retailers competing to launch their discount campaigns first, and shoppers rushing to snap up the best deals. As the last day of the long sales period, customers on Cyber Monday appear to have suffered from sales fatigue, expending more energy and budget on earlier discount offers.

High street footfall was down in 2017 with Springboard reporting a 4.2% drop from 2016. For a peak sales day like Black Friday, increasingly savvy internet shoppers know they have a much better chance of finding exactly what they want, at the best price, with a lower risk of encountering stock shortages. Battling a busy Black Friday high street is also physically draining. Skimming through products from the comfort of the own home is often a lot more appealing.

Customers also appear to be saving up for a big November splurge. Our data shows that November is now the biggest ecommerce month of the year, outranking December in 2017 and nearly doubling October’s spend. Discounts are clearly a major factor but customers will also be keen to tick off shopping lists well before Christmas.

Shopper perception of discount campaigns vs. reality

The transaction data is clear; Black Friday shopping is a hugely popular phenomenon that has travelled over the Atlantic and taken Europe by storm. However, public opinion doesn’t appear to match this narrative.

Image for black friday cross-border customer base

Source: We Live Security

We surveyed 600+ UK shoppers on their attitudes to Black Friday shopping and found that more than half do not believe the discounts are genuine. Even among those who proactively research prices before Black Friday, 47% do not believe in the discounts.

This general scepticism is fuelled by reports from the likes of Which?, who estimate that 60% of products can be found cheaper at other points in the year. However, our research, conducted alongside budgeting expert Martyna Sroka, aka Money Saving Girl, found the discounts to be significant.

Martyna found that if she’d spent £3,637 on Black Friday at five major retailers, the same items would have cost her £1,111 more two weeks later. That’s an average Black Friday saving of 30%. Perhaps the savviest of shoppers can find comparable deals at other times in the year, but for those looking for value, choice and sound timing ahead of Christmas, the Black Friday week is a great option.

FOMO: blows hot then cold

Customers have varying approaches to Black Friday shopping. Some plan ahead, meticulously researching products and prices ahead of the big day (or week!). Our survey shows that researchers tend to prefer desktops over mobile / tablet shopping, suggesting a systematic process rather than idle browsing.

Other customers act on impulse. 34% of respondents revealed a tendency to buy discounted items on impulse or out of fear of missing out (FOMO). Our payment data supports this: Black Friday checkout abandonment tends to be a third lower than the average day as customers rush to snap up the deals.

Although higher conversion rates may be a major target for most online retailers, the danger is that pressurised Black Friday shoppers will suffer from buyer's remorse, change their mind and return goods. Black Friday returns tend to hit hardest around 15th December and most are processed before Christmas, tying up stock during the busiest period the year. The strategy for managing returns has now become almost as vital as the sales themselves.

Europe: the land of opportunity

The UK’s Black Friday boom was mirrored across the continent, with EU spending 509% above the average Friday. This was more than three times stronger than the US’ spending surge. Denmark, Spain, Portugal, Italy and Malta saw the biggest jumps in spending with France, Europe’s second largest ecommerce market, following closely behind.

Image for black friday cross-border customer base

Source: We Live Security

For UK and US merchants, the holiday season represents a major opportunity to attract new customers across the continent. A word of caution: Europe has a hugely diverse range of regional payment preferences. For instance, in Germany invoice payments dominate e-wallets and alternative payments are popular in Scandinavia, in Netherlands customers mostly pay through iDEAL.

Black Friday discounts can attract overseas customers by simply providing them with a choice of checkouts they recognise in their own language and currency.

Look overseas and drive seasonal sales conversion

Our transaction data reveals a direct line of sight into global customer shopping behaviours during the seasonal shopping period. Retailers of all shapes and sizes should consider supplementing sales at home by ‘opening the borders’ to Europe and taking advantage of continental Black Friday fever. In 2018, the big winners are likely to be those with a cross border presence.

Merchants expanding overseas will typically invest huge efforts into bringing customers to their site and through to the checkout, but if the payment system is too cumbersome or unfamiliar they are likely to abandon the purchase. Localised payments that put customers at ease is an essential step towards establishing trust and  driving conversion. Successfully tapping into overseas peak demand will expand customer bases and lay strong foundations to grow in the future.

 

By Sangeetha Narasimhan, Marketing Manager, UK Ingenico ePayments.

 

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