BY JOHN ELLIS, FINANCIAL ADVISOR
Black Friday is upon us again. Without doubt the biggest shopping event of the year. Millions of deals are to be had across everything from TVs, laptops, to mattresses, home appliances, beauty, fashion, and toys. The sale is supposedly the best time to bag a bargain. The average spend in Ireland is approximately €400 per person, according to research published recently by the Competition and Consumer Protection Commission (CCPC).
It initially started in the US as a way for brands to mark the start of the Christmas shopping season the day after Thanksgiving. The Black Friday 2022 sale will officially start on Friday November 25 and run until the following Monday – dubbed Cyber Monday – when the sale event ends.
The first recorded use of the term ‘Black Friday’ was applied not to the shopping extravaganza we now know but to a financial crisis due to the crash of the US gold market that started on September 24, 1869. Two ruthless Wall Street financiers, Jay Gould and Jim Fisk, worked together to buy up as much gold as they possibly could, thereby driving the price sky-high and cashing out with huge profits. The plan backfired sending the stock market into free-fall, bankrupting everyone from Wall Street barons to farmers.
The term Black Friday went through several reinventions both positive and negative over the years and, finally, in the late 1980s retailers found a way to re-invent Black Friday resulting in the idea that businesses went from the financial red into the black thus marking the occasion when stores finally turned a profit.
Already we are inundated with adverts promising unbelievable bargains. According to the CCPC just under 40% of consumers plan on purchasing during the upcoming sales, with that average spend of €400. Of those 46% are planning to purchase electronics, with an average expected spend of €502. Laptop or tablet devices stand out as the most popular electrical items that consumers intend to buy (37%), followed by mobile phones (26%) and televisions (22%). Clothing, footwear and jewellery were the next most sought-after items (35%) with just more than half of under 25-year-olds planning these purchases.
Despite the high numbers of consumers who intend to shop in the sales, “consumer confidence in the accuracy of advertised discounts is low”. Of those intending to buy in the sales, 49% said they do not trust the accuracy of the discount information provided. When responses from all consumers are considered (including those who don’t intend to buy in the sales), trust rates fall further with only 35% of consumers trusting the accuracy of displayed pre-sale discounts.
Trust levels are highest among young people (15 -24 years) while those aged over 55 report the lowest levels of trust in discounts.
Misleading advertising is illegal. We should be able to trust in advertised discounts but it’s not always the case. Soon the Price Indication Directive will be brought in tightening up the rules on sales advertising and permit the CCPC to take enforcement action when businesses mislead consumers through discount advertising. Businesses need to play their part in building consumer confidence. They need to provide clear and transparent pricing history during sale periods.
In the meantime, keep safe out there. If shopping on line purchase from an EU website as you will have more protection and rights should something go wrong. Unfortunately UK websites due to Brexit are no longer covered and a website with a ‘.ie’ domain is not a guarantee that the company is based in Ireland.
Use a credit card instead of a debit card for even more protection. There are a number of online bank facilities which allow you to use a “one time only debit card” once used is destroyed giving even more protection.
It’s all about getting the best deal possible. However, too many just latch onto the first deal they see whether in the shop or online. Compare offers and focus on the” selling price” rather than the “advertised discounts”. And always look for the hidden fees and charges like postage/shipping.
Finally, in all the excitement have a plan of action, a budget and a clear idea of what you want because as Alexander Graham Bell said “preparation is the key to success”.