Are Retailers Experiencing a Shift in a Well Established Holiday Tradition?

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Historically Black Friday is a term that has been associated with events involving the selling of slaves to attempts by a few misguided investor barons to curb the precious metal market. But the term is most commonly familiar to the one day each year that retailers and hungry holiday consumers get together to change the retailers year-to-date operating losses into profit. For nearly a century and a half, the annual one-day meeting of production and consumption has resulted in some fairly creative and often times undesirable behavior from both sides of the equation. But just like everything else, time changes all things; nothing forever remains the same. The arrival and popularity of digital technology has spawned a new day of the week, Cyber Monday, and along with a new mobilized consumer tech is bringing about significant changes to the well-established annual event of “Black Friday”.

Sales figures for the 2015 Thanksgiving and Black Friday shopping period have been realized and they indicate that the estimated combined retail sales of $12.1 billion represent a significant decrease over last year’s performance. The numbers are seen as evidence that consumers are embracing mobile technology and online shopping in order to avoid what has become the negative “social stigma” associated with Black Friday. Many brick and mortar retailers experienced a decrease in traffic this year as consumers appeared to be shy about seeking the deep-discounts and mega bargains in person as they gravitated towards shopping by mobile and online sales. Many shoppers are clearly sending a signal that they are becoming weary about fighting through the big crowds and the in-store pandemonium that has become the trade-mark of Black Friday. Simeon Siegel, a New York-based analyst at Nomura Holdings Inc. said, “You can’t outsmart the consumer anymore. You need to pander to where the consumer wants to shop and when.”

Spending dropped an estimated 11 percent for the same period over last year according to the National Retail Federation (NRF). An estimated 6 million shoppers who had been expected to hit stores never showed up at retail centers around the country. The NRF had predicted that 140.1 million customers would visit retailers during Black Friday this year, but only 133.7 million turned out. There are some retailers who are signaling success during the period. Amazon is suggested to be the big winner this year. The retail giant announced record sales for Amazon branded devices; revealing they sold three times the amount of their branded electronics, with Fire TV sales up as much as six times over the same weekend last year. Walmart saw increased online and mobile sales. Popular purchases included large screen HDTVs, Xbox One, PS4 gaming bundles and the iPad mini. Target and electronics retailer Best Buy both reported better than expected online sales of popular electronic devices.

But a physical transaction of hard goods is not the only story in transition for this historic weekend. As the NRF announced that online shoppers eclipsed brick-and-mortar purchases for the first time ever, Groupon saw a tremendous appreciation for the process of shopping. More than 25% of Groupons sold this year was for a restaurant, salon, spa or other local merchants indicating that buying from home-town retailers and the traditional physical shopping experience is not completely abandoned.

Image courtesy of sumetho at FreeDigitalPhotos.net

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