Geneva launches the Trade Observatory, an economic observation tool

Merchants prepare for the day that marks the beginning of Christmas, Black Friday. Coming from the United States, sales day has been consolidated for several years as one of the most important days of the year for online stores.

After two years of the pandemic, however, Swiss retailers were hoping for better conditions for the festive season. Consumer sentiment worsened even more in October, falling to -47 points, the lowest level since the beginning of measures by the Secretariat of the Economy (Seco).

“The gap is widening between buyers of premium and standard products this year, under the effect of inflation and pressure on household budgets,” explains Norbert Herzog, GfK’s home equipment specialist. “Between falling demand, high inventory levels and pricing pressure, it is more critical – and challenging – than ever for retailers to find the right balance between cutting prices and preserving margins.”

“Current inflation is really changing buying behavior: customers are more price sensitive than ever before,” said a spokeswoman for Manor. However, if they reduce consumption on a day-to-day basis, “they also plan larger purchases during promotional days in a targeted way”.

“Since the summer holidays, we have felt a slight increase in demand for promotional items in supermarkets”, confirms a Migros spokesperson. In its specialized stores, such as Digitec Galaxus, the event is a must for the branches of the orange giant. “For m-electronics, a day of Blackfriday is ten times the volume of business on a normal Friday,” he explains.

On the side of Fnac, Christmas shopping, on Black Friday, represent “a little more than 30% of annual turnover”, says a spokesperson. In recent weeks, the movement in stores has increased, but the shopping cart has shrunk a little: “This is due to the retention of purchases (…), customers are waiting for Black week to make their major purchases of household appliances and multimedia”.

The online store has similar revenues to the previous year for Black Friday, which lasts for five days. The Christmas sales period represents a tenth of the company’s annual turnover. However, a generalized slowdown in revenues is expected, in a context of post-pandemic normalization. “We will no longer have the same sales spikes, but the positive trend for online commerce will continue,” said a spokesman.

Specialist in electronics, Mediamarkt intends to extend the duration of the promotions and the number of articles covered, but aiming at sales volumes similar to those of the previous year. Smartphones, laptops, headsets and game consoles are expected to be particularly popular, according to a spokeswoman. Warehouses are also fuller than at the same time last year.

Deals distilled over the course of a week

In Switzerland, promotions often last several days and even a whole week for Migros and its subsidiaries, Manor or Fnac. “In recent years, we have always had the challenge of adapting our logistics to the huge order volumes on Black Friday,” explains a spokesperson for Digitec Galaxus. With the new organization, the platform hopes that “orders will be better distributed over the days”.

Extending the duration of Black Friday is also beneficial for a sector that is experiencing a tense situation in the labor market. “During the holiday season, Manor offers over 550 jobs, either through fixed-term contracts or through third-party vendors through temporary employment agencies. We are still looking for around 300 jobs”, says a spokesperson.

On average, consumers plan to spend 289 francs on the event, after spending 273 francs a year earlier, according to a study by the Blackfriday observatory and GfK.

That expenditures can be maintained at last year’s level is not surprising to Patrick Kessler of umbrella organization “Inflation is still not really felt in Switzerland,” he explains. At 3.0% in October, inflation remains subdued in Switzerland compared to many European countries.

However, the prospects will darken from the months of January and February, when increases in rents, health premiums, energy costs and others risk reducing household disposable income.

This article was automatically published. Source: ats/awp

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