The era of holiday deals is dead, and so is Black Friday
IT TURNS out we’re not so slowly killing Black Friday.
Fewer Americans plan to shop on Black Friday this year than in previous years, as consumers grow accustomed to deep discounts year-round.
Thirty-five percent of consumers who plan to shop during Thanksgiving week say they will do so on Black Friday, down from 51 per cent last year and 59 per cent the year before, according to consumer markets research from PwC, the professional services giant.
“Black Friday has lost its significance,” said Steven Barr, consumer markets leader for PwC. “Retailers have conditioned the consumer to believe everything’s on sale every day, which means the deals on Black Friday are not significantly different from any other time.”
The shift comes as retailers and shoppers - treat the holiday shopping season as more of a weeks-long marathon than a oneday sprint. Seasonal discounts have become more spread out, both in stores and online, as consumers demand lower prices and greater convenience, which means the Black Friday frenzy isn’t nearly as pronounced as it once was. “More holidays year-round - including some that are retailer-generated - mean more opportunities for discounts and promotions,” the PwC report said. “Consequently, the decline of Black Friday is hardly news at all. Especially from its glory days heralding the start of the instore holiday shopping season.”
Barr added that retailers are slashing prices throughout the year. Take, for example, Amazon’s much-hyped Prime Day this summer, in which the company says it generated more money than during Black Friday and Cyber Monday last year.
The company did not offer specifics, but said “tens of millions” of its Prime members, who pay a US$99 annual fee for the loyalty programme, made a purchase on that day. (Jeff Bezos, the founder and chief executive of Amazon, owns The Washington Post.)
In all, Americans are expected to spend about US$680 billion this holiday season, marking a 3.6 per cent to four per cent increase from last year’s US$655.8 billion, according to estimates released Tuesday by the National Retail Federation. Those figures are in line with last year’s 3.6 per cent growth in holiday spending.
“The combination of job creation, improved wages, tame inflation and an increase in net worth all provide the capacity and the confidence to spend,” Jack Kleinhenz, chief economist for the lobbying group, said in a statement.
Even as consumers spend more, Black Friday turnout has steadily declined in stores and online. Last year, for example, 154 million Americans shopped during Thanksgiving weekend, marking a 32 per cent decline from 2011, according to the National Retail Federation.
“The consumer has learned that even if they don’t get a deal on Black Friday, they’ll still get that deal in the weeks to come,” Barr said. “There is no urgency anymore.”
And even those who are chasing deals are increasingly doing it from the comfort of their homes. Among those who plan to shop on Black Friday, about 30 per cent say they will shop exclusively online, compared to 19 per cent who plan to shop in stores, according to PwC data.
As a result, a number of major retailers, including Home Depot, IKEA and Office Depot, say they will remain closed on Thanksgiving day. Others, like REI, have gone a step further by closing stores on Black Friday.
“While the rest of the world is fighting it out in the aisles, we hope to see you in the great outdoors,” the company said in announcing its new policy in 2015. — WP-Bloomberg