Black Friday generates R196m for Takealot

Lauren Kate Rawlins
By Lauren Kate Rawlins, ITWeb digital and innovation contributor.
Johannesburg, 26 Nov 2018
Takealot CEO Kim Reid.
Takealot CEO Kim Reid.

Local online retailer Takealot has revealed that in the first 24 hours of its annual Blue Dot Sale going live on Friday, it generated over R196 million in total transaction value.

The start of the five-day Blue Dot Sale coincides with Black Friday, a sale traditionally held in the US the day after Thanksgiving but which has grown globally over the last few years and represents the start of the festive shopping season.

Takealot says it saw a 125% year-on-year growth in gross merchandising value (GMV) and 127% growth in orders on Black Friday this year. It made R87 million in GMV last year and R56 million in 2016.

This was despite the company experiencing site difficulties throughout the day on Friday with its credit card payments portal.

"We are humbled by the incredible support from our customers on our biggest sales day of the year," says CEO Kim Reid.

"Black Friday is a great opportunity for first-time shoppers to trial online shopping and this year we saw a record number of new buyers make the most of the deals on offer."

He says it was interesting to note that 68% of visitors on the day chose to shop for the best deals from their mobile phones on the Takealot app and mobi site.

Best sellers on Takealot included Tommy Hilfiger Girl For Her perfume and the Nu Camp Folding Table. Nappies were also popular, as well as the new DSTV Explora 2, say Reid, and over 3 000 TVs were sold on the day.

According to research by PwC: "Black Friday is a cash cow for local retailers. BankservAfrica (the continent's largest automated payments clearing house) recorded R2.5 billion worth of transactions on Black Friday in 2017. The 4.7 million card transactions that it cleared on the Friday were double the daily average.

"Some 54.6% of South Africans took part in Black Friday last year, with the survey finding 66.5% will be taking part this year. Respondents indicated they are planning to spend on average R1 654 on their Black Friday purchases in 2018."

Other local online retailers have not yet announced how much money they made on Friday.

Getting the orders out

Making incredible amounts of money on Black Friday is not the end of the process, as all those orders now need to be delivered to consumers.

Takealot says its team is focused on delivering orders in accordance with the estimated delivery dates shared with customers at check out.

"Customers are able to track their orders every step of the way, from the warehouse to their door, by using Takealot's order tracking service on desktop and mobile," says Reid.

Parcelninja, a delivery company that has been delivering orders for third-party sites for the past five years, prepared in a number of ways for this year's Black Friday.

Some of its current clients include Wantitall and First National Bank's eBucks site.

CEO Justin Drennan says: "We scale up in a variety of ways. First is to look at our server infrastructure and make sure it is designed up-front for high-scalable days. We then make sure we have enough server capacity, and third we liaise with all of our crew and service providers to make sure they are aware of what volumes we are predicting.

"We have systems that manage distribution across multiple couriers to make sure that if one courier is having drama it is replaced with another. At the same time, we have service level agreements with each where if we guarantee a volume of orders, they guarantee delivery.

"The next thing we do is hire additional staff for the period. We run longer shifts and we run the entire weekend."

Drennan says this ensured that some people who ordered from eBucks on Friday received their deliveries over the weekend.

The Takealot Blue Dot Sale extends into Cyber Monday today and will culminate in 'Takealot Tuesday' with hundreds of new deals being added daily.

Other local online retailers are also taking part in Cyber Monday today. These sales are traditionally reserved for online shopping after the Back Friday weekend.