Black Friday: How Much Will It Matter?


In some ways, there's something comforting about the way retailers are gearing up for Black Friday, that make-or-break kickoff to the holiday season. Stores like Target are already shoving aisles of Christmas items in between the Halloween costumes. And advertising circulars are already being leaked to deal-finding websites, creating a buzz retailers count on to build traffic.

But there are also signs that this holiday season - the second consecutive year of dreary economics lessons - will be different.

Retailers, for the most part, will consider it a big win if they can sell at least as well as they did last year, Leon Nicholas, director of retail insight at Management Ventures, based in Cambridge, Mass., tells Marketing Daily, "We don't expect to see as many flashy price points, as more stores have locked in already-low pricing. I don't think we'll have the assortment we've had in the past. And in many ways, Black Friday is becoming more of a cultural event about browsing than buying, with people surfing the web for deals and ideas."



Stores are encouraging that, Phil Rist EVP/BIGresearch, says, "by making Black Friday earlier and earlier each year," with many events and web-only sales starting on Thursday. "We'll see even more of that this year." Still, he says, Black Friday matters as much as ever. "It's always going to be the day for the super deals and the way stores try to get the money early in the season."

And indeed, many people are shopping earlier. About 69% of shoppers expect to do most of their holiday shopping by Dec. 7, up from 60% in 2008, according to a new survey from Accenture, the consulting company. And more say they plan to shop on "Black Friday" -- the day after Thanksgiving -- this year (52% vs. 42% in 2008).

But once they get there, Accenture predicts something of a disconnect. Retailers have drastically cut back their inventory levels to avoid the bloodbaths of last year, so there will be fewer desperation discounts - at least initially.

But 86% of the shoppers in the survey say that unless they can get a discount of at least 20% or more, they won't buy. (In fact, a quarter of those say that unless discounts are in the neighborhood of 50%, they won't open their wallets.) And 38% say they shop late deliberately, because that's when they believe they will find the best bargains.

That may make for a bleak Black Friday. With so many consumers still worried about jobs, Nicholas says, "you may see them buying heavily at discounters, where they believe inventory will be limited. But while you may see a lot of people walking through stores like Macy's, they won't be buying yet. Retailers have trained them to wait longer."

2 comments about "Black Friday: How Much Will It Matter? ".
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  1. Howie Goldfarb from Blue Star Strategic Marketing, October 27, 2009 at 10:08 a.m.

    This could be a very scary holiday season. It is really a bad thing that so much of our yearly retail sales are based on gifts for a holiday. And if so many people shop early and by Dec 8th sales are slumping it will be a price slashing frenzy. Shame on the US people and retailers creating this unholy situation. I am sure the person we are celebrating goes on vacation to somewhere tropical during the month of December in disgust.

  2. Paul Burani from Web Liquid Group, November 2, 2009 at 3:37 p.m.

    It's problematic to say "many people are shopping earlier" and then cite a statistic indicating consumer *intent* -- ("about 69% of shoppers expect to do most of their holiday shopping by Dec. 7, up from 60% in 2008..."). Is there anyone among us who has ever told themselves, OK, I'm not going to wait until the last minute to do (something), only to find themselves scrambling at the last minute?

    That 69% number should be looked at with skepticism, especially given the fact that the number of jobless people in the US this year far outstrips 12 months ago. Shallow pockets don't exactly inspire the masses to take action. Retailers should instead pay attention to profit centers like their shipping policies, where they can recoup some dollars in the likely absence of these volumes. That's what the Green Monday principle is all about:

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