Is Black Friday good for small businesses?

Online stores are rushing to give discount offers ahead of this year’s Black Friday shopping bonanza set for November 25, 2016. FOTOSEARCH 

By MARYANNE GICOBI

In Summary

• Large e-commerce shops and major retail chains splash out with big promotions and marketing campaigns in a bid to attract customers to spend more.

Online stores are rushing to give discount offers ahead of this year’s Black Friday shopping bonanza set for November 25.

Online retailers like Jumia, Kilimall and Rupu have announced huge discounts on select products including smartphones, electronics and clothing.

Black Friday is an American tradition that has quickly taken root in Africa.

Large e-commerce shops and major retail chains splash out with big promotions and marketing campaigns in a bid to attract customers to spend more.

This day takes place every first Friday after Thanksgiving (a harvest festival held on the fourth Thursday in November) and is a day of big deals and promotions for American shoppers.

Black Friday is already popular in South Africa, as is Cyber Monday, the following Monday (November 28), when online shoppers are out in full force looking for tech and gaming gadgets’ bargains.

Other African countries like Kenya and Nigeria are following suit, with retailers rolling out big discounts to woo buyers.

Some campaigns by Kenyan online stores read:

“Kilimall Black Friday, the best deals of the year!”

“Enjoy unbelievable and unbeatable discounts on quality products. It's all systems Go! Shop till you drop!” Rupu says.

“Be a part of the biggest shopping event in Kenya - Black Friday 2016!” Jumia says.

Sage, a market and technology company, looks at the pros and cons of Black Friday for small businesses.

1. Shopper enthusiasm

Pro: Customers know about Black Friday and look forward to shopping for bargains on the day. There’s a high level of awareness and interest among those treating themselves or shopping for Christmas gifts.

Con:If customers expect you to have wonderful Black Friday deals every year, it may discourage them from spending money in the weeks leading up to the big day.

2. Intense competition

Pro: If you’re agile enough, have the right offers and a sharp marketing message, you may attract some good business with low-cost, tactical email and social media campaigns.

Con:The competition from other retailers is intense, especially with large ecommerce sites and big retail chains offering loss-leaders to get people into their stores to spend money. It can be hard to cut through the noise.

3. Rid your business of old stock

Pro: It’s a great opportunity to market old inventory that you would need to mark down or dispose of, anyway.

Con:Customers are price-sensitive on Black Friday, and you could find yourself needing to discount aggressively to close sales.

4. Scaling up for customer traffic

Pro: You can generate a lot of footfall into your shop or traffic for your website with the right offer.

Con:You need to be sure that you have the capacity to serve the customers you attract – if your website falls over under the weight of thousands of visitors, your delivery logistics aren’t up to scratch or you don’t have stock to service demand, it could damage your brand.

5. Draw new prospects

Pro: Shoppers are adventurous on Black Friday, so you have an opportunity to attract new customers or to get customers to buy goods from you that they usually get somewhere else.

Con:It’s open to question how loyal some of these customers will be – they could simply be bargain hunters.