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Black Friday: A Consumer Extravaganza or a Retailer Nightmare?

According to 2018 results, Black Friday sales topped $6.22 billion in the US alone, with the UK accounting for an additional £1.5 billion revenue, dominated once more by Amazon which recorded the highest activity on both sides of the pond. What’s more, research conducted by PwC found that shoppers spend £234 on average over this weekend, with the majority of spending online. Consequently, the combination of Black Friday and Cyber Monday undoubtedly offers a huge and unmissable business opportunity for brands and retailers alike.

While many shoppers are simply keen to get their Christmas shopping in early, an increasing number of internet-savvy buyers go after fast-moving consumer goods (FMCGs) at knock-down rates only to resell, almost immediately, at a profit, throwing what was a relatively organised online distribution chain into chaos. Many of the brands we work with ‘suffer’ specifically from this phenomenon, and have identified Black Friday and Cyber Monday sales as the chink in their otherwise well-protected brand armour.

Putting aside the ample sales opportunities, many brands use the Black Friday weekend to clear old stock – last year’s designs, less popular offerings, or even to mobilise cash. Fast forward to a new product-launch some weeks later and while the authorised distribution chain is delighted to be promoting the newest widget, promoted at half the price is last year’s offering, right alongside the newest, brightest star …. and taking the sale.

Paul Chung, Head of Brand Protection at SnapDragon Monitoring, commented: “Unauthorised sellers are a nuisance. They might not be selling low-cost counterfeit goods (or they may be!) but their products are generally still sold at a lower RRP, causing a headache for those who do adhere to the MAP”.

So, what can be done?

While registering for Brand Registry and Transparency should help the cause, brands cannot force Amazon to enforce their distribution policy, nor can they force the platform to stop sellers from listing their products. Brands face the same issues on other major marketplaces, including eBay and across the Alibaba platforms.

It is worth considering publishing information about your authorised sellers on your website or social media platforms. This way, potential customers will know where to go and who to trust. Buying from an unauthorised seller can have consequences. Safety concerns aside, reselling a product often invalidates its warranty, causing serious headaches for customers if something goes wrong further down the line. Be vigilant, and make sure that your customers know this.

Getting to know your supply chain and distribution network is crucial. How are you supposed to help your customers buy safely if you don’t know where to direct them? Monitor online platforms and keep in touch with authorised sellers regularly. There are online brand monitoring tools out there that can simplify this task, but education is key.

SnapDragon’s online brand monitoring software, Swoop, provides 24/7 online intelligence about your brand online. With options to select your approved resellers, or unauthorised sellers, you can view each listing and the details behind it, including product images, pricing, inventory (if given), and the sellers’ details. If your images are being misused, there’s an option to report the listing for copyright infringement, and if the stock was originally bound for another market and has crept back into another (known as parallel imports), other options may be deployed to protect your ever-precious distribution chain.

For more information contact us here.


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