Hamish McRae: Stop being prissy, we need to celebrate Black Friday

Black Friday is coming up this week. Thanksgiving, which goes back to the first harvest in America by the pilgrims in 1621, is on the fourth Thursday of November, and many take off the Friday too. What do Americans do when they have a holiday? They shop.

But not just Americans. Amazon brought Black Friday to the UK in 2010, and since then it has exploded around the world.

They have a Black Friday in Nigeria, in Australia, in India, in Hong Kong, in Germany, even in France, in fact, just about everywhere except mainland China, where Singles’ Day is the great shopping extravaganza.

That is on 11 November, and was started by students in Nanjing university in 1993, who, distressed by their single status, decided to give presents to themselves, a sort-of-antidote to Valentine’s Day, with the 11/11 date a symbol of singlehood.

It took the genius of Jack Ma, who founded the online retailer Alibaba, to turn a rather sad student affair into a rival to Black Friday. It may now be bigger than Black Friday and Cyber Monday (that’s next Monday) combined.

So it is huge. What does that tell us about consumerism? It is easy to see how a long holiday weekend creates an opportunity for retailers to promote their sales. It is more remarkable that the idea of a special day to go out and shop has not just survived the shift to online, but been enhanced by it.

You can buy online any time; you don’t need a day off to go and buy stuff — you just need a mobile phone and a way of paying, and it will be delivered to your door.

Established retailers know how to create the theatre of a special shopping occasion to coincide with a holiday period: think of the first day of our Christmas sales. If it was smart of Amazon to take an established shopping day and push it online, it took utter genius at Alibaba to create a virtual shopping event almost out of the blue.

But they could not have done so had it not been something that we humans deeply, deeply want. There is lot of evidence that buying stuff makes people happier. Actually, if we buy something as a present for someone else it seems the happiness lasts even longer. So the creation of a special day on which a splurge of spending takes place generates a collective wave of pleasure that more than offsets the increased costs.

The logistics of Black Friday are a huge challenge. You have to staff for it, your online ordering capacity has to be robust enough to cope with a sudden burst of orders, and you have to get the products out to the buyers in time.

On top of all this you have to offer, or at least appear to offer, cut-price bargains. And what do you do with the lines that don’t sell?

These additional costs are more than offset by three factors.

First, a special spending festival favours scale. The bigger you are, and Amazon is the biggest, the wider the range of stuff you can deliver and the larger the share of the available spending pot for you rather than some struggling high street chain. That is why Amazon and Alibaba pour resources into this.

Second, sellers get higher margins. Having a special sales day with eye-catching loss-leaders attracts business you would not otherwise get.Then if people feel they have saved money on one thing, they are more relaxed about spending it on something else. Overall, margins are higher. And third, it skews spending habits towards goods and away from services.

Over the past half-century goods have become cheaper relative to services. As a result more and more of our income goes on services: more on posh coffees, less on not-so-posh clothes. Black Friday tilts the balance back towards goods, in that money spent on half-price headphones is money not spent in the pub.

The conventional criticism of Black Friday is that it encourages irresponsibility: that it entices people to spend money they can’t afford on things they don’t need. I don’t buy that.

How people choose to spend their money is their business, and at least they have something to show for it.

There is a legitimate concern that it pushes sales to online giants and further damages the high street, but Black Friday is an example of that trend, not a cause of it.

So I think we should stop being prissy, and instead celebrate Black Friday.

We are pack animals. We like to do things together. That is true even if we are physically apart, sitting at home ordering online. And if it and its offspring Singles’ Day make a few billion people happier, what’s wrong with that?