Canadians ‘do make tough choices’ over Black Friday discounts

Canadians ‘do make tough choices’, with consumers poised to ignore promotions as high-street sales prompt brain drain Consumers in Canada are showing no indication of running out to snap up the bargains being offered…

Canadians 'do make tough choices' over Black Friday discounts

Canadians ‘do make tough choices’, with consumers poised to ignore promotions as high-street sales prompt brain drain

Consumers in Canada are showing no indication of running out to snap up the bargains being offered across the pond on the eve of Black Friday this weekend.

Retailers north of the border have moved away from the Black Friday madness, but Canadians could still be poised to ignore their retailers in favour of online rivals. The number of people looking to shop on Black Friday in Canada last year fell significantly from 2016. But not in Ontario, a market which has no comparative sales equivalent to what Americans see on the day. In Ontario, 71% of shoppers looking for the best deals across the US-Canada border decided to shop on Black Friday in 2018, according to Statistics Canada. That compares to a global average of 52% of shoppers.

Consumers across the north are instead turning to online stores in a bid to avoid spending too much. “The package on the street looks to be much more popular than, say, a pair of shoes sold via an in-store flash sale,” Mark Banting, managing director of KPMG’s Ontario retail practice, said. The option of digital couponing could therefore encourage shoppers to opt out of Black Friday in Canada, he added.

Canadian retailers do still have a chance of selling goods at a healthy rate on the day, but that’s dependent on whether they put up prices in response to Brexit, said Banting. “If they just charge their regular prices and don’t discount, it might just not be enough.”

It’s all part of the “social norm” of early-bird customers arriving early to grab the best bargains, he said. “We see people do make tough choices. If there’s one company that can’t afford to discount, it could be them, but it’s the right decision to not.”

Guillaume Leger, an associate professor of economics at Queen’s University, said the price gap between internet shopping and retail hasn’t changed in years, and now it’s becoming more of a choice. For bargain hunters shopping online, “there are more options.” In the past, they’d have to take a chance at the store to find out how good the bargain was.

“If that’s not an option, I don’t see the flow continuing on Black Friday,” he said.

The very concept of Black Friday still holds with Americans, with many turning up on the Friday before Thanksgiving shopping for deals they could never see on sale in the US.

UK shoppers in recent years have been more savvy and used their smartphones to do research before heading out to the shops.

Tim Rochford, founder of internet shopping apps Glyde and Milo, said he was worried that Black Friday was becoming too predictable. His commerce platform enables retailers to sell through Facebook adverts – an avenue that has recently been contested in Canada and is still banned in the UK.

Retailers would likely be disappointed to see pre-Black Friday sales in the UK increase threefold on the days before Thanksgiving, he said.

Rochford said internet sites had a “level playing field” with mainstream retailers, even as it struggled with paying for the same wages and tax rates as British retailers do. “The tax structures for online retailers can sometimes be 10 times higher than bricks and mortar retailers,” he said. Rochford noted that Canadian retailers have come out fighting against tax charges in their jurisdictions, suggesting this year’s Black Friday may see less hype and hype-for-hire.

“They’ve already told us in Canada, ‘Thank you for bringing it up,’” he said.

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