The metrics that matter for your Black Friday markdown strategy in 2021

By Tom Summerfield on September 11, 2020

The world around us has changed dramatically in the past year or so, and the retail sector in particular has felt the full force of this impact. We’ve seen online adoption accelerate and, off the back of this, more brands begin to turn and face the incredible potential of their data when it comes to optimizing their process and powering smarter decisions. 

(Article updated 6 January 2021.) As we look ahead to 2021, we’re focusing on the Black Friday/Cyber Monday weekend. As retailers face another turbulent year, gripped by uncertainty, we’re predicting higher costs, bigger budgets and more at stake than ever before as retailers will look to end the year on a high. In terms of a merchandising strategy, it’s either going to be all about driving footfall and sales, or focusing on clearing some of that terminal stock gathering dust since lockdown.

We always advice our retail customers to start planning for Black Friday more or less a year in advance, so hopefully, you’re well on top your 2021 Black Friday plans. If not, we’ve compiled a handy list of some of the key metrics that you need to be focusing on across your merchandising and planning not just over the weekend, but all year around. 

Merchandisers, presenting the metrics that matter for your Black Friday markdown strategy in 2021…

Fundamentals: Day-to-day metrics
  • Rate of sale 
  • Weeks of cover
  • GP%
  • Gross profit variance
Key indicators: Mid-level metrics
  • EBIT contribution by line
  • GPV vs GP%
  • Markdown cycle
  • Net margin/profit
  • Average Transaction Value (ATV)
  • Range planning/space planning
  • Pounds per square metre/foot
  • Sell-through
Strategic: High-level management metrics
  • Time saving
  • Working capital employed (ROCE/GMROI)
  • Regional web sales vs store locations
  • Promotions to ease working capital
Win in these areas, and you win the Black Friday battle

Hopefully you’re already tracking the majority of these metrics, and exploring different avenues and approaches to help you achieve success across the board. If not, you need to be looking at how you can win in these areas to make your Black Friday markdown strategy as effective as possible.

At Peak, we’re working with a wide range of retailers to help them shape their strategies for the coming months. Since the pandemic, we’ve seen an increasing number of businesses begin to better understand the importance of their data in driving a competitive advantage. When this data is leveraged by artificial intelligence (AI), it drives smarter decision-making and optimized processes across the business, helping you to positively impact all of the above metrics in your merchandising efforts as part of your Black Friday markdown strategy.


Retail markdown optimization

Identifying an opportunity to drive $3m in additional margin.

Sign up to the Peak newsletter

Get the latest Peak news and AI insights delivered straight to your inbox

Subscribe today!