JOHANNESBURG – Low consumer confidence in the face of soaring fuel prices, weak wage growth and a weaker rand-dollar will have a bearing on this year's annual Black Friday retail day on November 23, market research institute GfK said on Tuesday.
South Africa, like several other countries, has adopted "Black Friday", the informal name for the day following Thanksgiving Day in the US, the fourth Thursday of November, which is regarded as the beginning of the country's Christmas shopping season.
GfK South Africa commercial head for market insights Kali Moahloli said retailers would be hoping for a repeat of last year’s success, which was the strongest Black Friday to date for consumer electronics sales in the country.
GfK point of sale data shows that panel television unit sales climbed by 47 percent and smartphone unit sales increased by 63 percent during the week of Black Friday 2017 compared to the same week in 2016.
"(But) with a soaring petrol price, poor gross domestic product (GDP) and wage growth, and a weaker rand-dollar exchange rate, consumer confidence is low in South Africa," Moahloli said.
"With consumers under strain, manufacturers and retailers will need to think carefully about how to capture a share of their shrinking disposable income. It seems likely that consumers will be hunting for bargains and many of them will hope that Black Friday will deliver."
Moahloli said the result could be a spike in Black Friday sales, but at the expense of sales growth in December.
GfK predicted that despite the weak economic backdrop, there would be good growth in Black Friday retail sales, with categories such as panel-TVs and smartphones likely once again to be the star performers.
"That said, the base is higher this year than it was in 2016 and 2017, so the growth rate may not be quite as high as it was then," it said.
"What is clear is that Black Friday is now a massive day in the annual South African retail calendar. Indeed, it has grown into a week-long frenzy of specials and promotions," the market researcher added.
"And unlike summer or winter sales and promotions, it’s not about shifting old stock, but winning market share by offering consumers attractive prices highly coveted products such as games consoles, smartphones, computers and TVs. Love it or hate it, it’s becoming increasingly difficult to ignore it."
African News Agency (ANA)