Today South African consumers are expected to be on the lookout for good-value deals on Black Friday amid a cost-of-living crisis.
Data from the Bureau of Market Research (BMR) shows that R7 billion more is likely to be spent on goods during this period compared to last year.
Research by the BMR on behalf of retailer finance provider Capital Connect found that Black Friday spending was expected to increase from R19bn last year to R26.6bn this year and create approximately 150 000 seasonal or temporary jobs.
Anton Hugo, PwC South Africa retail and consumer industry head, said the net impact of Black Friday/Cyber Monday on retail income was challenging to calculate accurately because of some shift in holiday spending from December to November.
"Nonetheless, South African retailers have increasingly designed the shopping holiday to focus on a Black November period, providing a larger volume of smaller sales during the month, rather than solely on the four-day Black Friday/Cyber Monday weekend,” Hugo said.
Christie Viljoen, PwC South Africa senior economist, said while overall consumer sentiment was weak at present, local consumers’ predisposition to purchase goods on sale, combined with retailers going all out to generate sales during Black November, had resulted in a positive outlook for retail income during the current month.
“This is likely to be reflected in retail sales and private sector credit data for November. It could also provide a boost to gross domestic product (GDP) growth momentum during the final quarter of the year,” Viljoen said.
Data from Statistics South Africa (StatsSA) last week showed that retail sales rose by 0.9% in September from a year earlier, following a downwardly revised 0.3% decrease in August.
However, according to FNB senior economist John Loos, Black Friday, which happens to fall on a day before most people get paid, and would not set off any fireworks this year.
This was due to rising interest rates that had resulted in high costs of servicing debt, poor income growth, and slow GDP growth.
Meanwhile, results from the latest survey conducted by debt review company Debt Rescue revealed that a staggering 70% of consumers this Black Friday would focus on hunting for deals that would put more food on the table and help families to stock up on necessities such as toiletries, electronics and other tech items.
Survey results showed that, while inflation and record high living costs had spiked consumer demand for great deals, a whopping 85% of working South Africans planned to spend less this year than in previous years, pointing to a reduction in disposable income. Despite economic challenges, a significant 83% of consumers intended to participate in Black Friday, while 89% were willing to spend up to R3 000 for the right deals.
The survey polled just under 2 800 participants in the 25 – 65 age group, with the aim of understanding consumer engagement, spending patterns, and overall sentiment regarding the value and authenticity of Black Friday promotions.
Debt Rescue CEO Neil Roets said the insights from the survey reflected a practical stance among consumers toward spending wisely amid economic fluctuations.
“This shift suggests a heightened focus on value, with consumers eager to maximise their financial resources through strategic purchasing, with 80% price checking and adhering to a shopping list,” Roets said.
He said the fact that most South Africans were prioritising necessities was concerning, and reflected the dire financial state of households, who were hanging on by a thread.
"This is very similar to the trend that shaped Black Friday in 2022, and has in fact shaped the trend of this retail phenomenon over the preceding two years, with people carefully considering every cent, before committing to a sale,” he said.