Discounts Don't Build Fans. Drops Do.

Black Friday used to mean something.

Now it means a month of "EARLY ACCESS" emails, websites that crash under pressure, and customers trained to never pay full price. Turkey 5 spending has dropped nearly 13% since 2019. In-store traffic fell 8.2% last year alone. And 60% of Gen Z shoppers say they regret their Black Friday purchases.

As Mark Cohen, former CEO of Sears Canada, put it: "The integrity of the event is pretty much gone."

He's right. But here's what most retailers are missing: while Black Friday crumbles, something else is thriving.

Drop culture is eating retail alive. And it's not even close.

The Discount Death Spiral

The problem with discounts isn't just margin erosion (though that math is brutal). It's what discounts teach your customers.

One in four Americans now report "consumer fatigue": exhaustion from the constant pressure to buy, subscribe, or chase the next deal. And that fatigue has consequences. Research shows customers whose first purchase involves a discount are 50% less likely to return for a second one. Their lifetime value? 23% lower than full-price buyers.

Every time you slash prices, you're training your audience to wait. To expect it. To never pay what your product is actually worth.

Marketing expert Mark Ritson called it perfectly: within half a decade, Black Friday "metastasized from a single American shopping day into what retailers now openly call 'Black November,' a month-long global carnival of discounting."

And what did that carnival produce? A race to the bottom where everyone loses.

Why Scarcity Beats Savings

Here's the uncomfortable truth: your brain literally values scarcity more than savings.

Neuroscience research shows that dopamine (the chemical that makes you want things) spikes during anticipation, not acquisition. And when there's unpredictability involved? The effect doubles. That's why 60% of consumers make FOMO-driven purchases within 24 hours of feeling like they might miss out.

Discounts, on the other hand, trigger the opposite response. Studies show consumers perceive heavily discounted products as lower quality. A Harvard Business Review analysis found that frequent discounting can reduce brand value by up to 33%.

Discounts signal desperation. Exclusivity signals desirability.

The question isn't whether to create urgency. It's what kind of urgency you're creating.

The Brands Proving It Works

While traditional retailers fight over who can offer 40% off, a different playbook is generating billions.

SKIMS doesn't do Black Friday sales. Kim Kardashian's shapewear brand runs weekly drops in controlled batches, 20,000 to 200,000 units designed to sell out fast. The result? A $5 billion valuation in six years. Over 11 million people on waitlists. One viral dress with 110 million TikTok views and 46,000 people waiting to buy it. When the North Face collaboration dropped, 180,000 people signed up for the waitlist and the website crashed from demand.

Products go on sale only twice per year, in limited private sales. The scarcity is the strategy.

Pop Mart took blind-box collectibles and turned them into a global phenomenon. Their 2024 revenue hit $1.8 billion (up 106.9% year over year) with profits growing 203.9%. The Labubu plush category alone grew 1,289% in a single year. On StockX, Pop Mart became the top-traded brand in collectibles, surpassing LEGO and Bearbrick.

These aren't discounts. These are drops. And they're creating value, not destroying it.

Even the brands that opted out of Black Friday entirely have won. REI launched #OptOutside in 2015, closing all 143 stores on Black Friday and paying employees to spend the day outdoors instead of working. The result? A 9.3% revenue increase. Over a million new members. 6.7 billion media impressions. More than 150 other businesses followed their lead.

Opting out wasn't anti-commerce. It was pro-brand.

Black Friday's Chaos Problem

The traditional model doesn't just fail to build loyalty. It fails operationally.

Last year, 36% of all holiday retail traffic came from bad bots and data centers, a 24% increase from the year before. Nearly half of all internet traffic is now automated. During the holiday rush, 83% of visitors challenged with CAPTCHA failed, meaning bots were overwhelming human shoppers at scale.

Meanwhile, major retailers keep crashing. Costco's website went down on Black Friday 2024. Boots UK's app and site crashed repeatedly during their "biggest ever" sale. Nike has experienced multi-hour outages. Harvey Norman Australia may have lost up to 60% of online sales due to infrastructure failures.

And the returns? Holiday return rates hit 17.7% the week before Christmas last year, up 10% from the year prior. NRF estimates returns cost U.S. retailers nearly $890 billion annually.

The chaos isn't a bug. For traditional Black Friday, it's a feature. One that costs everyone.

The Future Is Exclusive, Not Cheaper

The data tells a consistent story: 67% of consumers report increased brand affinity after participating in a drop. 76% who participate are "very or extremely satisfied." And 91% of America's best apparel loyalty programs now offer early or exclusive access to drops as a core benefit.

Drops let brands sell at full retail price while customers feel like they got something special. That's not a paradox. It's psychology working in your favor instead of against you.

The brands winning right now aren't racing to the bottom on price.

They're racing to the top on access.

Your next drop doesn't need a discount to drive demand.

It needs scarcity, fairness, and infrastructure that doesn't collapse the second hype becomes real.

If you're ready to stop training customers to wait for sales and start building fans who show up because they want to be there, Fanfare was built for exactly that.