In today’s Exponential Investor…

  • Something weird on my Amazon account
  • Traffic in Philadelphia
  • One winner from Black Friday

Something weird happened over the last couple of weeks.

Something that didn’t happen this time last year.

Nothing to do with vaccines. Nothing to do with lockdowns.

No, the weird thing is Black Friday sales started.

I logged into my Amazon account – I needed some dog food – and I noticed that “Early Black Friday Deals” was plastered all over the site.

I remember last year the Black Friday deals started a little early, but this year, it’s already been a couple of weeks of Black Friday deals.

By the time Black Friday actually rolls around, does that mean there will be more deals, or the deals that exist now will be worse?

I’m not quite sure what to make of it.

What I do know is that it could lead to one of the biggest single money-generating events of all time.

Why Black Friday?

Black Friday. It sounds like the title of a horror film. But historically it’s just one day of the year when retail shoppers go mental.

Black Friday is the name given to the day after Thanksgiving in the US. Its origins go back to the 1960s.

Apparently the name comes about from Philadelphia traffic cops talking about the horrible traffic conditions during the day back in the 1950s.

That was due to immense crowds flooding the city the day after Thanksgiving for an Army-Navy football game.

Then in 1966 an advertisement was placed in The American Philatelist magazine advertising “Black Friday”.

Soon enough it just became the term to highlight the post-Thanksgiving retail sales.

Black Friday stuck. It’s a part of US culture, and now a part of global culture. Just one more “Americanism” the world has latched on to.

Black Friday has now reached far beyond the US borders. In Canada it’s hugely popular and in India of all places it’s become a major day for shopping. Even here in the UK Black Friday is now the shopping event of the year.

Online retail stores like Apple and Amazon don’t have borders like countries. You can be in the UK, US, India or even Australia and still buy things from Amazon. That means if Amazon US is having Black Friday sales, then so is Amazon UK, Amazon Germany, Amazon Australia – it’s happening everywhere.

Thanks to this American phenomenon, other retailers now follow suit. The end of November is now the “Black Friday sales” period for shoppers.

There’s not a single UK retailer that isn’t either already in the midst of or about to launch into a Black Friday sale.

Even on the website of the achingly traditional British retailer, John Lewis, it has the following explanation about Black Friday:

As we head towards Christmas, the phenomenon of Black Friday is something that has become a key event in our diaries. Black Friday originates in the US, but is now a worldwide event that sees a range of products available at discounted prices.

Every year Black Friday gets bigger and bigger. This year, those with a strong online and e-commerce focus sales approach will do well. But there’s one massive winner every time 27 November rolls around. It’s not John Lewis, it’s not Argos…

It’s Amazon.

A shot of adrenaline

Amazon is notoriously protective of its Black Friday sales numbers. But as a guiding indication, it made note that third-party sellers on its platform made $3.5 billion in sales during this year’s “Prime Day” – a 60% increase on the year prior.

Forecasts were that Amazon would do somewhere around $7 billion to $10 billion overall.

Looking back a bit further, in 2018 Amazon said its Black Friday and Cyber Monday sales broke all previous sales records. Adobe estimated that Black Friday for Amazon was about $6.2 billion in sales.

There’s a distinct pattern, that every year Amazon’s sales continue to rise and rise and rise around this major global shopping day.

This year isn’t going to be any different. In fact, with the real threat that shops will be closed coming into Christmas this year, Black Friday may end up being one of the last great chances for people to snap up a deal for 2020.

I’m saying that Black Friday and rolling into Cyber Monday is going to smash all of Amazon’s previous sales records. And not just by a little bit – but a huge margin.

Amazon might never tell us how much. But if forecasts for this year’s Prime Day were up to as much as $10 billion – I would expect that for Black Friday and Cyber Monday its numbers will soar in excess of $10 billion.

Think about that for a second. Over $10 billion worth of potential sales coming through Amazon’s platform this year. Its biggest ever single shopping event in history.

There’s only one outcome I see from the Black Friday and Cyber Monday shopping events which are now just over a week away – a massive boost for Amazon’s bottom line.

Now, I’m on record saying I have issues with the valuations of some of the Big Tech companies listed over in the US. And that I do think there will be a correction coming for some of them quite soon.

But you also can’t deny the environment of the market and a massive catalyst like Black Friday to give Amazon another big old boost.


Sam Volkering
Editor, Exponential Investor