Black Friday challenge heightens as confidence drops in key age groups
Should hopes rest on the spending power of 16-29 year olds?
October’s data from GfK’s long-running Consumer Confidence Barometer show a worrying ongoing loss of confidence in key age groups, in particular 50-64 year olds. This group is important to retailers going into Black Friday, as they are in general at a period of life with higher disposable income and greater financial security.
For the 50-64 year olds, this recent drop is driven by increased concern over personal finances over the next 12 months, but even more so by a drop in confidence over the nation’s economic position in those coming months – down 23 points since August.
Joe Staton, Client Strategy Director at GfK, comments: “You might assume that confidence amongst the ‘empty-nester’ 50–64 group ought to be relatively buoyant as this group are normally pretty settle and secure in terms of property and pensions. However, concerns about retail price inflation, underperforming investments and hikes in tax are off-setting the gains from record-high house prices and cheap credit.”
Prospects for Black Friday; 16-29 year olds but older groups
Of particular concern to both physical and online retailers in the run-up to Black Friday and the Golder Quarter is the 10-point drop between September and October in the 50-64 group’s already negative perception of ‘is now the right time to buy?’, taking them to -28, the lowest of any group.
Staton says, “It would appear the strongest group for retailers to target this Black Friday are 16-29 year olds: the only group to register positively, and with an upward trend, for both overall economic confidence and their perception that now is a good time to buy.”
"However, while the younger group is a good match for the technology and consumer durables traditionally promoted over Black Friday week, it would be a mistake to ignore the older age groups. Even in their current mindset, these high-value segments can be induced to spend over Black Friday and in the lead-up to Christmas by focusing on promotions that go beyond discounts and flash-reductions. Retailers should consider value-bundles that highlight elements such as convenience, superb product support, extended guarantees, or in-built insurance.
“The next three-months promises to be tough but communicating this type of ground-work today will set up a successful brand agenda for the final quarter, especially as 2022 is forecast to be a challenge.
Keep pace with consumer confidence
GfK’s Consumer Confidence Barometer (CCB) has provided essential context for businesses and organisations during times of crisis. It has offered insight into the UK’s thinking through boom and bust, the Brexit vote, and most recently, the coronavirus pandemic.