Stores that didn’t open on Thanksgiving Day are going to pay the price this year, experts suggested Friday. "Consumers were clearly out to buy,” said one prominent retail analyst.
With Americans' appetites whetted by aggressive promotions and a spate of new products, thousands of bargain hunters hit the ground running on Thursday evening, with analysts predicting early Friday that the weekend would be a good one for brick-and-mortar as well as online retailers.
Online spending had already topped $1 billion by Thanksgiving evening, said Adobe.
“It seemed like traffic was fairly healthy today. It did seem like it was up from maybe the last couple of years,” said Morningstar equity analyst R.J. Hottovy. “I think there had been pent-up demand.”
“We had a record-breaking day on target.com and traffic to our stores was strong,” Target CEO Brian Cornell said in a press release, attributing the bump to online “doorbuster” sales on electronics.
“There’s still an interest in Black Friday,” Macy’s CEO Terry Lundgren told CNBC. “The crowds are continuing to be steady today,” he said in a Friday morning interview, adding that shoppers want the “tactile experience” of visiting a brick-and-mortar store after doing research online.
Shoppers want the “tactile experience” of visiting a brick-and-mortar store after doing research online.
Analysts overall predicted this holiday season will be a positive one for retailers, echoing the National Retail Federation’s prediction of a 3.6 percent rise in spending through November and December, up to nearly $656 billion.
Some noted that shoppers seemed eager to hit stores on Thanksgiving evening.
“Thursday is the new Friday, no question about it,” said Marshal Cohen, chief industry analyst at a market research firm the NPD Group.
“From the stores I’ve seen, it looks like, at the open, things were pretty hectic and crazy like last year,” said Joe Feldman, senior managing director at Telsey Advisory Group. “It was busy last night for most people,” he said Friday.
“What’s happened with Black Friday and how they’ve spread this out — it’s become a lot more accessible,” said Traci Gregorski, senior vice president of marketing at Market Track. “By not only being open on Thursday and offering these deals online... there’s not that stigma” of long lines and fights for limited-quantity doorbuster items, she said.
Analysts said stores appeared to be better stocked with more inventory of popular items available, likely a response of more coordinated planning and better estimates by retailers, rather than a dearth of shopper demand.
“I think the stores that didn’t open Thursday are going to pay the prices. Consumers were clearly out to buy."
The earlier start shoppers this year seemed to prefer could reverse the trend of the last few years that had some chains opting to remain shuttered on Thanksgiving Day itself.
“I think the stores that didn’t open Thursday are going to pay the prices. Consumers were clearly out to buy,” Cohen said.
Gregorski said chains’ nearly universal decision to promote their Black Friday deals early rather than make them a surprise also played a role in the early activity. “Retailers seem to be a lot more proactive about communicating out what they used to hold very close to the vest,” she said. “They’ve done a lot of hyping up through digital advertising and promotions.”
Electronics continue to be the biggest driver of Black Friday shopping. This year, 50-plus inch and 4K TVs are leading the push along with other tech gadgets like headphones, “smart” speakers by Amazon and Google, and virtual reality headsets.
Online promotions are more plentiful and discounts are deeper this year, a trend led by Amazon, said John Neilson, director of marketing at Clavis Insight.
“I was really surprised to see the increase in the number of Amazon promotions,” he said. On Friday alone, Amazon added 10,000 items, with an average discount of 42 percent over the list prices.
On Friday alone, Amazon added 10,000 items, with an average discount of 42 percent over the list prices.
According to a study by Deloitte, this is the first holiday season Americans plan to spend as much online as they do in physical stores, which the consulting firm called “a significant milestone in holiday purchase behavior,” while data from Adobe found that shoppers spent nearly half a billion dollars shopping via smartphones and tablets this Thanksgiving Day, which made up nearly 40 percent of the day’s purchases.
As in physical stores, electronics drove the Black Friday promotions at Amazon, Wal-Mart, Target and Best Buy’s online offerings. “Electronics is coming out as a clear heavyweight among all four stores,” Neilson said, noting that fully half of Wal-Mart’s online promotions were for electronics.
But Amazon also started nibbling at the edges of legacy department stores’ bread and butter, Neilson said. In addition to heavily plugging its own products like the Echo speaker and Kindle e-reader line, Amazon made a vigorous push this year into apparel and jewelry, a category that comprised almost 20 percent of the e-commerce giant’s promotions, he said. “In terms of Amazon and their breadth of promotion, they’re offering more discounts in more categories.”
“I’m interested to see where this goes next year,” Neilson said.
“It’s almost like the online stores are setting the agenda. The physical stores are following and playing catch-up.”