Although the final result of Brazilian Black Friday was lower than that of 2019, as shown by data from Cielo, the largest acquirer in the country, online sales soared during this year’s shopping holiday. Different reports point to a growth of between 22% and 25% in e-commerce revenue, and JP Morgan‘s analysts risk indicating a possible domestic winner for the event: Magazine Luiza.
Considering Thursday (26) and Friday (27), traditionally the most intense days of Black Friday in Brazil, e-commerce accumulated BRL 4.02 billion in sales, according to estimates by Ebit|Nielsen – a 25.1% increase over the same period in 2019. In another report by Neotrust/Compre & Confie, online sales achieved a 22% year-over-year growth. And in the case of Cielo‘s data, based on the monitoring of 1.5 million stores, e-commerce grew 21.2% – on the other hand, brick-and-mortar retail stores had a 25.5% decline in total sales on Thursday and Friday.
The growth in online sales was already expected, mainly because of the boom that e-commerce has experienced because of the COVID-19 pandemic. According to Ebit|Nielsen, from November 19 to 27, the sector’s turnover increased by 30.1% over 2019, to BRL 6 billion. The average ticket also grew, 8.3% over last year, to BRL 652.
As sales grew, so did the complaints. Reclame Aqui (Portuguese for Claim Here, a Brazilian platform focused on customer service) registered 9,160 complaints, an increase of 4.09% over the previous year. Most of the complaints were about deceptive propaganda during Black Friday, as O Estado de São Paulo pointed out.
“Although it is reasonable to assume a decelerating trend in the next quarter, we still see e-commerce as a persistent consolidation trend among a few winners, considering its low share in total retail sales and companies’ greater focus on improving service levels and increasing the number of categories sold, ” said BTG Pactual‘s analysts Luiz Guanais and Gabriel Savi, in a statement sent to investors and journalists.
Black Friday’s main domestic players
On Monday, Via Varejo announced that it reached BRL 3 billion in sales (GMV), surpassing the BRL 2.2 billion in the equivalent period in 2019 and thus setting a company’s new record. The firm pointed out that it split the sales event between November 22 and 28 to avoid crowds’ risk in brick-and-mortar stores in the face of the pandemic.
Via Varejo’s online sales in the period grew 99% year-over-year, with 62.4% of total sales, the company added, citing preliminary and unaudited data.
Magazine Luiza, also known as Magalu, also made a month-long Black Friday to avoid agglomerations and said it reached a “triple-digit – above 100%” growth in e-commerce in November. In physical stores, the company stated that growth in the same store’s data remained at the same level as in previous months, being stronger in the first weeks and relatively stable on the day before and on Black Friday. “Magalu increased its market share in Brazilian formal e-commerce by 10 percentage points in November, compared to the previous year, according to Ebit|Nielsen,” stated the company.
“In a nutshell, the figures show Magazine Luiza as the relative winner in our view, with online sales more than doubling year over year in November and SSS (same-store-sales) likely at the mid-to-high single-digit level, indicating potential upside to our estimates for the company’s fourth-quarter earnings,” JP Morgan‘s analysts wrote in a statement to investors and the press.
When it comes to Via Varejo, JP Morgan’s analysts believe the news should be read as negative as, “despite coming from a tough comp base from the promotional event in ’19, we believe the market was not anticipating a potential decline for brick-and-mortar sales.”
Lojas Americanas and its owner B2W did not provide updates regarding their performance on Black Friday. Yet, JP Morgan’s analysts said that GMV growth forecasts for 4Q20E stand at 33%/51% year over year, respectively, below the reported figures reported by Magalu and Via Varejo.
“Given the current outlook, with consumers staying more at home and online sales less concentrated on a specific date, we expect Cyber Monday, already popular in the US, to also boost quarterly sales (especially in the online channel) versus previous years,” BTG analysts said.
In Brazil, Cyber Monday also shows an increase in online sales in the annual comparison, according to the startup Nuvemshop. Only on the morning of this Monday, BRL 4 million had been billed only, an amount 71% above recorded in the same period of 2019. The volume of orders increased by 91%, close to 70,000, but the average ticket fell 8% to BRL 203.