What Does Black Friday and Cyber Monday Mean for Luxury Brands?

For most people, when you hear “Black Friday” you think of mobs of people almost breaking down the doors of a Walmart or Best Buy to get an insane deal on flat screen TVs or laptops. Similarly, when many people hear “Cyber Monday” they think of sites like Amazon crashing due to the high volume of traffic and users trying to get in on the hot, online discounts. Which leaves us wondering, “how do luxury brands do Black Friday and Cyber Monday?”

Surely, Prada and Chanel aren’t offering their designer pieces at 75% off the original price. Obviously, Louis Vuitton sales associates aren’t frantically holding the doors shut at 5am on Black Friday morning to keep the crowds at bay. However, many assume that luxury brands are exempted from a good bargain bandwagon, such as Black Friday and Cyber Monday, but in recent years, that couldn’t be further from the truth.

In fact, in 2017, Bloomberg reported that luxury labels and retailers saw the industry’s highest volume of markdowns over the Black Friday weekend, followed by premium brands. According to the report, high-end goods saw the steepest volume of discounting [6]. It’s hard to say whether consignment retailers were taken into account in this report as they often already offer substantial discounts on designer goods. If consignment retailers were taken into account, then it does seem plausible that high-end goods saw such a dramatic change in discounts and offers. Otherwise, other research seems to support that luxury brands are still cautious of the deals they offer during Black Friday and Cyber Monday.

However, the trend for exceptional deals is generally found online as opposed to department or flagship stores. According to the Bloomberg report, in 2017 almost a quarter of luxury handbags for sale online during the Black Friday-Cyber Monday week were marked down anywhere between 40% and 50%, up from 30-40% the previous year. The report also named Fendi, Balenciaga, Tom Ford, and Prada as some of the top discounted brands [3]. At the same time, accounting firm Deloitte found that over 50% of 2017’s holiday shoppers now say they prefer online shopping to brick-mortar stores, with just 36% saying the opposite. Roughly 55% of shoppers tell Deloitte they’ll be shopping online, as opposed to the 44% going to discount stores and 28% going to department stores [3].

So it seems like the consensus is online versus in-store. New studies show that the most successful cyber week tactics are selling on or through social media outlets, such as Facebook or Instagram. This also includes email marketing prior to American Thanksgiving, content and commerce integration and strategies, inventory preparation, and influencer marketing/social media engagement [5]. Especially in the cases of luxury, you’ll see a push on the social media front, as well as targeted ads, leading up to Black Friday and Cyber Monday.

When deals are found on luxury items at brick-mortar stores, it’s not likely you’ll see them at the flagship stores of Louis Vuitton, Hermès, or Chanel, but rather at high-end department stores, such as Nordstrom or Saks Fifth Avenue. Reports say that Nordstrom’s Black Friday sale has become a bit of a cult favourite for those on the hunt for discounted luxury fashion. People.com has teased that the 2019 Black Friday Nordstrom Sale will be the “best one yet” for shoppers [2].

However, North America’s finest shops do Black Friday in a different way than their mid- to mass-market counterparts. They don’t try and create hectic crowds or tolerate doorbusters, but there are still sales to enjoy and deals to find. Markdowns are rare and modest with 25% off in one corner; an extra 10% off in the next. Of course, this is all strategic. If you get a chance to visit speciality or flagship stores you may see extended hours, but no awe-worthy deals. If you want real deals, go downmarket to the doors of a Coach store or other mid-level premium brands where you can find signs displaying “up to 50% off!” that you won’t get with high luxury brands [1].

What we believe to be one of the most obvious reasons for luxury to be modest on deals is the idea that offering luxury goods on sale dilutes the brand. As a result, luxury brands still participate in Black Friday and Cyber Monday in other ways than dramatically slashing prices in order to avoid negatively affecting their overall brand image. Even luxury buyers enjoy scoring a great deal or an exclusive find. However, for luxury retailers/brands, they can create excitement around Black Friday without tarnishing their brand and they do this in a variety of ways [4].

For instance, although luxury flagship stores do not often feature any discounts, according to a report from the Business of Fashion, they do tend to open their stores earlier and potentially stay open later to encourage Black Friday shoppers to make the most of the day. As another example, luxury department stores, like Bergdorf Goodman, have previously offered Saint Laurent handbags at 40% off. Even though this is a significant discount, they limited it by only offering it on a specific item. Other labels and products were sold at regular price [4].

Alternatively, in order to keep with the aesthetic of the “exclusivity” of luxury, in the name of Black Friday some luxury brands offer limited edition Black Friday collectibles, but at full price. Not necessarily giving in to the sales of Black Friday, but instead these brands find creative ways to get people excited without actually having to slash prices on current products. Luxury brands can sometimes offer early or exclusive previews to next season’s goods to Black Friday shoppers; spiking traffic and interest without sacrificing any profit [4].

As mentioned already, another tactful way for luxury brands to divert customers to deals without offering them in their own flagship stores is to offer discounts through partner retailers or similar channels. For instance, a certain bag may not be discounted at the Gucci flagship store, but it is discounted at a luxury department store, such as Saks Fifth Avenue or Nordstrom. This way to not explicitly discount the brand as a whole, but just certain items at a partner retailer [4].

Even still, in compiling all of this research, reports indicate that the preeminent way to find the best deals (and the easiest deals!) is to shop online, specifically the consignment market to make the most of your luxury buys. If you’ve had your eye on something for awhile, this is the time of year to make those luxury fashion investments without doing too much harm to your wallet.

If you’re a modern and wise shopper, then you’ll swap pacing through crowded shopping malls for the comfort of your own home, by shopping online. Black Friday bargain hunting has never been easier in the age of the internet! If the deals and brands mentioned in this post haven’t already spiked your shopping interest, make sure to check out Lux Second Chance for our Black Friday and Cyber Monday specials! With a wide range of brands and products already at incredible discounts, we only offer an extra discount twice a year so check out Lux Second Chance website on Friday, November 29th and Monday, December 2nd for the EXTRA % OFF!  Offer is only for those days!

Happy holiday shopping to all our Luxers out there! May your Christmas be as luxurious as your style!

Sources:

1. Kim Bhasin, “How Top Shops Like Barneys, Saks and Bergdorf Do Black Friday”, Business of Fashion, November 25, 2017. https://www.businessoffashion.com/articles/news-analysis/how-top-shops-like-barneys-saks-and-bergdorf-do-black-friday 

2. Julie Loffredi, “Black Friday 2019: Luxury Fashion Deals to Expect”, Forbes, October 23, 2019. https://www.forbes.com/sites/julieloffredi/2019/10/23/black-friday-2019-luxury-fashion-deals-to-expect/#5a627c733b8e

3. Miriam Tremelling, “10 Stats from Black Friday and Cyber Monday”, Pixlee, November 2017. https://www.pixlee.com/blog/10-stats-from-black-friday-and-cyber-monday/

4. Sharanya Venkatesh, “Black Friday Marketing Campaigns for Luxury Retail”, Wealth Engine, September 5, 2019. https://www.wealthengine.com/black-friday-marketing-campaign/

5. Tracey Wallace, “Cyber Week 2018 trends Report: Pre-Thanksgiving Sales Grow, Mobile Drives Majority of Revenue”, November 2018. https://www.bigcommerce.com/blog/cyber-week/

6. Lisa Wolfson and Stephanie Hoi-Nga Wong, “Luxury Brands Yield to Discounts Despite Push to Stay Exclusive, Bloomberg, November 27, 2017. https://www.bloomberg.com/news/articles/2017-11-27/holiday-markdowns-deepen-despite-brands-push-for-higher-prices