Black friday and Seasonal Discounts

The Holiday season is officially among us folks! I’m sure many of you are still coping with the copious amounts of stuffing and cranberry sauce consumed on and after Thanksgiving, I know I am. And while Thanksgiving is a holiday I certainly look forward to every year, Black Friday is a day that I’m sure plenty of other people look forward to. With the passing of Black Friday, I find it necessary to talk about the pricing strategies many companies adopt during this time of year because, I must say, they’re pretty genius.

As we all know, Black Friday takes place the day after Thanksgiving and is a day that most companies offer their greatest discounts and sales all year round. It is a day that promotes heavy consumerism and spending and that many Americans excitedly take part in for low-priced items that will ultimately serve as christmas presents for friends, family, and loved ones.

I work in retail, so preparing all the marketing and promotional signs for Black Friday was pretty stressful; and while Bath & Body Works offered some pretty great deals that lots of men and women were stoked about, I must say there were definitely some better sales and promotions going on at other stores, like Old Navy.

Did anybody else hear about the crazy promotion Old Navy was having during their Black Friday sales? Here, watch this:

So one million dollars awarded to one lucky shopper? That’s crazy! But what is the real reason for giving away a million dollars? Personally, I believe that this is a perfect example of loss-leader pricing, which is a special promotion where the purpose is to attract customers, not to increase sales, in hopes that they will buy other products as well.

If you watch the advertisement again, you will notice the additional text that comes up on the screen at the end for a different promotion, which informs the customer about the discount they are having in the store, which is that all items in the store are an additional 50% off.

But it’s not just Old Navy, a ton of companies offer outrageous discounts, or reductions from the list price that a seller gives a buyer as a reward for some activity of the buyer that is favorable to the seller, around this time of the year. For example, Forever21 offered deals starting at $6 and offered additional discounts of 70% off certain online orders.

One of the most popular usage of discounts I have come across at stores like Bath & Body Works are quantity discounts, which are discounts that encourage consumers to buy larger quantities of items so they can save more money. It usually offers 10% off purchases of $20 or more, 20% off purchases of $30 or more, and 30% off purchases of $40 or more.

These discounts are usually pretty effective and usually result in customers carrying out numerous bags of product, which means that the pricing strategies these companies set for their seasonal discounts are pretty effective and profitable.

So, I hope you all are ready for the crazy sales that will continue on through Christmas and after New Year's, because I know I am!