Retailers saw a quieter-than-expected activity on Black Friday (Nov. 25).   In major cities retail sales were bolstered by an influx of tourists who came to take advantage of discounted merchandise, as well as the participate in the season’s festivities.   

Cross-border trade helped drive online sales as international shoppers had greater opportunities to grab deal-priced products from American or British online stores.

Despite the intense promotions, consumers have smaller appetites for purchasing, and even extreme discounts are less tempting than they used to be.

 

Major Shifts Impacting Black Friday

Pushing Consumers Online – retailers went to great efforts to encourage consumers to shop online, rather than in their physical stores with extra discounts and earlier accesses to bargains.

The Downside – losing impulse purchases that happen in physical stores, not online.  The ‘holiday spirit’ that comes from eye catching in-store decorations, Christmas music, seeing the products in person – all of this is lost when shopping online.

The Unusual Has Become Usual – the novelty of shopping at 6 am on Black Friday or going to a mall on Thanksgiving Day evening, is no longer novel (and it was the ‘experiece’ as much as the bargains that captivated consumers).  

The Downside – retailers need to find a new strategy that will excite shoppers – and that will require more creativity than simply extended opening hours.

Everyday Bargains – an intensely competitive retail environment has led to year-round sales, promotions and events surrounding even minor holidays.  The deep discounts offered during the holiday season are not always better than what consumers get during the rest of the year.

The Downside – increasingly aggressive discounting has less impact on driving sales and is having a greater impact on eroding profits.

The Thoughtful Consumer – a new, more practical mindset has been growing with consumers thinking more and spending less.   “I like it. I’ll buy it.” is being replaced by “I like it. Do I really need it/want it? Hmmm…I’ll think about it.”

The Downside – Especially online, carts are being edited and curated with extreme care before shoppers hit the ‘check out’ button.  “Save for later” is being clicked increasingly often.

Strategic Shoppers – years of pre-holiday discounting has taught consumers that they can get even bigger bargains closer to Christmas as desperate retailers offer more incentives to buy.

The Downside – discounting has led to even more discounting.  It’s become an endless downward spiral.