MRI Software (previously MRI Springboard) has forecast subdued Black Friday sales, as issues loom over retailers. Restricted consumer spending power is expected to limit footfall performance compared to last year, as households contend with interest rates and inflation during retail’s Golden Quarter. MRI Software predicts that week on week footfall will rise by +7.6% across all UK retail destinations.
The rise highlights weakening footfall on Black Friday, in the previous two years footfall increased by an average of +9.7%. From 2014, when MRI Software first started collecting data on Black Friday, to 2019, the average week on week rise was +21%, highlighting a long-term shift in consumer behaviour since the pandemic when it comes to shopping in bricks and mortar retail destinations on this Black Friday. Footfall this year is expected to be -8-12% lower than a pre-pandemic Black Friday.
Since Black Friday 2022, interest rates and inflation have risen considerably with more consumers feeling the pinch. As households are hit with higher energy and heating bills, alongside rising mortgage payments to over £400 a month for many, it’s likely that many consumers will hold off past Black Friday until closer to Christmas to maximise the savings they can make.
Year-on-year footfall has weakened in recent months and now sits -1.3% below 2022 levels across all UK retail destinations. A number of retail destinations have lost anchor stores and are also feeling the impact of rising prices and slowdown in consumption. Retailers are dealing with a plethora of obstacles, with the long-term shift to online shopping also contributing to a weak Black Friday footfall performance.
MRI Software predicts that footfall on Black Friday this year be driven by shopping centre destinations (+14.4%). This is likely attributed to a number of factors making them attractive to consumers including free parking in some cases, a wider variety of shops to choose from and leisure facilities that consumers can make a day of it. Retail parks are forecasted to see footfall rise by +5.5%, whilst high street footfall will rise by just +5.1% on Black Friday, compared to a +17.2% boost on Black Friday in 2022.
However, it’s not all doom and gloom for retailers as MRI Software’s latest UK consumer survey revealed that 60% will look to purchase gifts in the Black Friday sales. With many brands having already launched their Black Friday sales online, bricks and mortar retailers and destinations will need to be creative in attracting shoppers during this period and providing consumers with a memorable experience as well as significant savings.
Jenni Matthews, Marketing and Insights Director at MRI Software, commented:
“Harsh economic conditions, falling consumer confidence and the continued shift to online shopping are set to create a challenging Black Friday for retail. Although we can still expect some consumers to make the most of Black Friday sales, the long-term shift towards online shopping combined with increasing household bills will see a subdued boost for bricks and mortar retailers. With evidence that shoppers will want to hold out for a better bargain as we get closer to Christmas. What is interesting to see is if the ‘golden glow’ of Black Friday and the kick starting of Christmas spend is fading.
Last year, retail destinations saw footfall rise by 10% from the year before (2021) on Black Friday and this was largely driven by a rise of 17.2% in high streets. However much of this uplift could be viewed as an anomaly of Covid from the previous year when shoppers were cautious about visiting congested retail destinations.”