Black Friday 2024 saw South Africans prioritising essential purchases over luxury items, with record spending reported across grocery and retail sectors, highlighting a shift in consumer behaviour amid economic challenges. Picture: Henk Kruger, Independent Media.
The actual day of Black Friday this year coincided nicely with payday, which allowed thousands of South Africans to benefit from deals when they actually had money in their bank accounts – with billions ringing through the tills.
Perhaps as a function of this, with the month-end grocery shop due to happen anyway, most of the spending went through grocery retailers according to payment providers. This spending pattern could also be due to the economic hardships South Africans have needed to deal with throughout 2024.
There were, however, big spenders out there. FNB reported that one of the biggest, out of the 20 million card transactions processed on the day, was for a purchase made at Cartier Boutique, for R780 000. Absa had a similar finding: one single R1 million transaction was reported among the thousands of others made on the day.
The largest individual transaction Peach Payments processed over the weekend was for R441 000 in the travel and tourism industry.
Capitec, which reported between 500 and 600 transactions a second over Friday and Saturday morning, said the largest single-card purchases were made in the following essential categories:
Grocery retailers collectively recorded R1.98 billion in spending, with Shoprite leading as Capitec processed 892 408 payments while Clicks was the dominant pharmacy retailer, with over 304 000 swipes, physical or otherwise.
Francois Viviers, Group Executive of Marketing and Communications at Capitec, said “We see a growing focus on shopping for essentials rather than luxury items. Considering our client base that covers a third of our country’s population, this behaviour reflects a broader national trend of wiser and more strategic financial decisions.”
This is something that corresponds with Absa’s findings. Chris Wood, Managing Executive of Product said that the shape of transactions over the period indicated that people were buying necessities with the big retailers as capturing most of the wallets over the weekend. “They were buying things that they needed rather than things that they wanted,” he said.
“A lot of our consumers actually had money in their wallets,” said Wood noting that Black Friday coincided with payday. This money, he said, wasn’t actual cash, with withdrawals downs in favour of other types of payments, such as cards, instant EFTs, and virtual solutions.
“If you know what you want and that becomes a deal somewhere, then you're winning on all fronts because you're getting an item that you actually needed and getting at a better price,” said Wood.
What did surprise Absa was that e-commerce didn’t grow in the double-digit range it had in previous years, said Wood. “I think maybe what’s happening is people also started to dig a little bit more,” he said, explaining that people weren’t taking online deals at face value, but rather shopping around to ensure they got the best possible price.
“And that's not a bad thing. It means that e-commerce is becoming more a regular part of the fabric” of shopping behaviour, Wood said. This is also evidenced by the fact that people also spent more time at brick-and-mortar shops coming off the low base caused by COVID-19, he said. Absa was, at one stage, processing almost 900 transactions a second.
Yet, Senzo Nsibande, CEO of FNB Card said, “e-Commerce saw a 37% increase in transaction values and 76% increase in transaction volumes, while physical transactions saw a 10% increase in values and 19% in volumes”. FNB, which saw almost 700 transactions a second, found that strong continued growth in general was seen over Saturday and Sunday.
Capitec’s figures showed that Takealot.com led online retail with over 52 000 orders, while Shein established itself as the preferred online fashion destination with 13 666 transactions. Uber dominated ride-hailing services, facilitating 154 365 rides, while lottery purchases increased significantly with over 560 000 purchases across the two days.
Interestingly, items that can be considered more of a luxury spend, such as travel and tourism, leisure, and entertainment, also benefited over the sale period. Nsibande said the most growth across all categories was in travel, at 15.4%, and clothing, gaining 11.4% compared to last year.
According to payment service provider, Peach Payments, sales for leisure and entertainment through its system grew 113% over the four-day period from the Friday to the Monday when compared with last year.
Capitec’s figures point to dining experiences, with fast food outlets like KFC and McDonald’s being the key beneficiaries of the R93 million its clients spent at these outlets. The bank said this spend equated to 2.3m Streetwise Two meals or 1.79m Big Macs. Overall spending by its clients on Mr D and Uber Eats over the Black Friday weekend was R27.79m, with Mr D dominating the category.
Rahul Jain, CEO and co-founder of Peach Payments said: “This Black Friday was a good day for the e-commerce industry as a whole, in a tough year, and we have surpassed expectations”.
Research conducted by the Bureau of Market Research for fintech Capital Connect released at the end of October stated that retailers in South Africa will generate R22bn in additional direct revenues because of Black Friday sales this year and as R28bn in indirect economic impact.
Wood believes that shopping as the country heads into the festive season hasn’t peaked, with the likelihood being that people are still set to buy Christmas presents and the like after the traditional December 15 payday.
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