Where Does Black Friday Fit into the New Fashion Calendar?

Where Does Black Friday Fit into the New Fashion Calendar?

Written by Phung Yi JunJune 1, 2020

Where Does Black Friday Fit into the New Fashion Calendar?

With the fashion industry lobbying for change in seasonality, what will happen to Black Friday?

It’s around this time of the year that fashion buyers and merchandisers will normally start preparing for the retail phenomenon, the annual event that has trained consumers to expect price slashes and spawned a discount culture that the industry has never quite shaken off. 

How to Discount to Avoid Brand Dilution

“Over time, Black Friday has become more drawn out with retailers offering big deals as early as the first week of November,” says Matthew Markland, the former director of planning at Stage Store. “Retailers were afraid to lose that sales volume,” he continues, citing it as a reason for their participation every year.

But now, in the midst of a global health emergency, priorities have shifted. 

A group of designers, executives and retailers are proposing to rewire the fashion calendar, which affects fashion weeks and buying and discounting cycles. The proposal racked up more than 600 signatures within just a few days of its launch. 

Gucci is the latest to go seasonless, following Saint Laurent. Alessandro Michele, Gucci’s Creative Director, broke the news on Instagram, believing that the crisis has “amplified such transformative urgency, which can’t be deferred anymore”. 

“That is why I decided to build a new path, away from deadlines that the industry consolidated and, above all, away from an excessive performativity that today really has no raison d’être”. 

This great reset leaves brands and retailers wondering where Black Friday fits into the new calendar. 

“Now that we have had this much disruption in retail,” says Markland, “they [brands and retailers] have to back away or scale down their events and shift resources elsewhere.” 

In this article, we take a look at last year’s Black Friday performance – and share how brands and retailers can move forward in the next normal.

Black Friday 2019

For a discount bonanza like Black Friday, brands and retailers go all out to not only top last year’s performance, but to win the market share. The bigger, the better. 

Omnilytics’s data spotted two major key trends: 

Sitewide Sales 

To drive traffic, sitewide sales were rampant on Black Friday. From Asos to Pomelo, placing a blanket discount was a key tactic last year. Even brands and retailers in Southeast Asia, like Poplook and Charles & Keith, participated in the event. 

Omnilytics Visual Merchandising for Black Friday banners
Source: Omnilytics’s Visual Merchandising

Early Warm-ups

Brands and retailers released discounts early to beat the crowd.

Omnilytics Visual Merchandising for Black Friday banners
Source: Omnilytics’s Visual Merchandising

On November 18 2019, 11 days before Black Friday, Boohoo released its ‘Black Friday Warm-up Sale’, a 25% sitewide sale, before transitioning to a deeper discounting of up to 75%. 

Forever 21 took a different approach, offering 30% off on selected categories each day, ranging from coats and outerwear to tops and bottoms, before offering a 30% sitewide sale with an additional 50% for sale items. 

These strategies, however, likely won’t work in our new era. Offering the cheapest across all categories provides little value in today’s Covid-19 landscape, where consumers are increasingly value-driven. 

If you choose to participate in Black Friday this year, the priority is reassessing the landscape. Here’s what to know.

Smart Markdowns 

In our article Digital Revolution: Key Lessons from the Crisis and How Fashion Can Navigate the Next Normal, we detailed how deep markdowns not only hurt the bottom line, but also fail to entice customers. 

“The data has shown that doing gradual discounting actually increases sell-through rates and reduces average markdown during a season, compared to doing flat discounts,” said Giulio Xiloyannis, CCO of Zalora. 

The same applies here. 

Brands and retailers must clearly identify where the most popular wins are, defining a sweet spot that drives high sell-outs without sacrificing margins. 

While Boohoo’s promotional offer ran up to 75% off, its 20-29% discount range drove a high sell-out contribution, further affirming that customers are willing to purchase at lower discounts as long as they’re on the right products. H&M too scaled back on heavy discounting (starting with 20% off for Black Friday), and focused on members-only offers. 

A Deeper Look

Amongst the top fast fashion brands in the US, including Revolve, Zara and Fashion Nova, the highest number of discounted items were offered in the 20-39% off range, with the best performing sitting at 30-39% off.

Discount breakdown by categories amongst top fashion brands in the US.
Discount breakdown by categories amongst top fashion brands in the US. Source: Omnilytics’s Dashboard

The categories which saw the highest number of discounted products were tops, dresses, outerwear and pants & leggings, though some brands favoured jumpsuits & playsuits (Fashion Nova) and swimwear (Revolve). 

Use the Omnilytics’s Covid-19 Fashion Retail Dashboard for free insights:

Amongst the top four categories, outerwear and tops had the highest SKU count. The former drove a higher sell-out at full-price, with a lower average discount, despite a higher median price.

Sell-out performance by categories amongst top fashion brands in the US.
Sell-out performance by categories amongst top fashion brands in the US. Source: Omnilytics’s Dashboard

For non-apparel, accessories and jewellery performed well too, with the majority of reductions below 35% off. 

But identifying popular categories isn’t the last step. 

The ex-Head of Merchandising and Head of Retail for China at Asos, Sarah Johnson, who now runs Flourish Retail, recommends reviewing stock and sales at both category and product level to create more targeted promotions. Implementing precise strategies on SKU-level, rather than blanket discounting, will see higher returns.

Product movement of Grey Ribbed Knitted Midi Cardigan from Pretty Little Thing.
Product movement of Grey Ribbed Knitted Midi Cardigan from Pretty Little Thing. Source: Omnilytics’s Dashboard

It’s important to analyse product movement, for a clear view of how much you can discount to drive sales. This Grey Ribbed Knitted Midi Cardigan from Pretty Little Thing, for example, saw strong sell-outs at full-price. If the brand were to set a blanket discount of 50% for all cardigans, it would lose out on a higher opportunity for more revenue. 

Key Takeaway: Omnilytics’s data suggests that customers are more than happy to pay for products at lower discounts, or even full price. Smart markdowns will benefit you in the long run – look into targeted promotions for SKU-level discounting. 

Seasonless: Quality Over Quantity

With seasonless fashion paving the way, conversations around sustainability are increasingly heightened. 

Retail’s habit of producing an excessive amount of SKUs for a season results in widespread markdowns. Simon Collins, the co-founder of WeDesign and former Dean of Parsons School of Design, adds that in his merchandising experience, “only 5% of the inventory would sell on full-price, while the bulk of everything was sold on discount”.

But now, brands and retailers can no longer rely on markdowns to clear stock. Consumer demands have shifted, and as shown above, high markdowns don’t always generate high sell-outs. Gary Wassner, CEO of Hilldun Corporations and Project Runway: Fashion Start-up panellist, advises that buyers “edit down your assortment to such a sharp degree that you’re confident it will sell”.

Key Takeaway: Edit, edit, edit. Everything boils down to consumer demand, and in our new retail climate, less is infinitely more. 

Review Sales Planning & Forecasting

Johnson recommends reviewing sales planning and forecasting. Doing so allows brands and retailers to understand their potential stock positions. Coupled with an analysis of sales and demand from last year, product gaps can be easily identified. 

“From this, retailers may be able to utilise existing stock for Black Friday messaging, rather than clearing this through other channels or promotional strategies; effectively ‘re-purposing’ the stock,” Johnson explains. 

Key Takeaway: Understand your stock position well to spot product gaps – don’t introduce newness for the sake of it. 

Wiping The Slate Clean

As we transition into the next normal, brands and retailers alike must evolve to remain relevancy. It’s high time the industry prioritises strong curation, compact edits, and focuses on providing value. 

Only time will tell if Black Friday loses its significance, but one thing is here to stay: market shifts are now controlled by the consumers. 

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