Retailers gear up for $586B holiday
Tribune News Service
Jul 21, 2015 at 11:50 AM
Or at least as ready as Tan, a store manager, and his sales crew can be before the action sports retailer opens its doors at midnight Thursday for a 22-hour marathon run through Black Friday.
By kicking off for the holiday shopping season only hours after consumers clear away Thanksgiving dishes, his and many stores hope to entice and excite mall shoppers to spend more this season.
The good news for retailers is that consumers are enthused about Black Friday again, said Renato Scaff, senior executive at Accenture's retail practice. "This is the first year where it's reversing that trend of not having interest in shopping on Black Friday," Scaff said.
"There has been a declining pattern in the last three years in the consumers' willingness to shop on Black Friday - from 52 percent in 2009 to 47 percent in 2010 to 44 percent last year." This year, that number jumped to 53 percent – the highest in four years.
With one of the biggest shopping weekends ahead, here are seven retail trends that shape the Black Friday picture:
1. Say hello to Black Thursday
Big box stores and mall retailers are opening earlier than ever – many starting after dinnertime on Thanksgiving Day. Walmart and Sears will open their doors at 8 p.m. on Thanksgiving night and Target at 9 p.m. Kmart opens even earlier, at 6 a.m. on Thursday.
Retailers that open earlier get consumers' shopping dollars sooner, said Marshal Cohen, chief industry analyst of The NPD Group Inc."It's no longer Christmas creep, it's the Christmas crush," Cohen said. "This is about beating the competition... research shows that over the Black Friday weekend, it was worth their effort for retailers to beat the competition to the punch."
Here's why: Stores that extended their hours earlier gained up to 22 percent in sales over the Black Friday shopping period last year, while similar stores that did not extend their hours lost up to eight percent, he said.
Get used to the Black Friday beginning on Thursday, Cohen said. Thanksgiving Day is a traditional holiday, not a religious holiday, and for stores, being open on that day is no different than being open on other non-religious holidays such as Independence Day.
He's not the only one saying Black Thursday is here to stay.
Chainlinks Retail Advisors forecasted that it may take a year or two, but the majority of retailers and shopping centers will eventually be open on Thanksgiving Day.
"It already is one of the busiest days of the year for movie theaters and many restaurant chains," according to Chainlinks Retail Advisors. "With retailers facing ever more intense competition from both online retailers and one another and consumers continuing to demonstrate that they are willing to show up earlier to cash in on deals, we see it as only a matter of time before Thanksgiving Day becomes the new Black Friday."
2. Workers protest Black Thursday
While stores benefit from opening earlier, the idea isn't sitting well with some employees who have to work on Thanksgiving Day. Some workers started or signed various petitions on change.org asking stores such as Target, Walmart and Best Buy to stay closed on Thanksgiving. One petition started by Target employee Casey St. Clair -- called "Target: Take the High Road and Save Thanksgiving" -- has garnered 352,000 supporters as of Monday.
Target notes that other employees welcomed the overtime hours. "When we made the decision to open our doors at 9 p.m. on Thanksgiving, the first thing we did was reach out to all of our store leaders and ask them to have discussions with their team members and seek volunteers wanting to work," said Tina Schiel, executive vice president of stores for Target. "We had so many team members who wanted to work on Thursday that hundreds of our stores are now keeping lists of volunteers who want to work if shifts open up."
Some Walmart workers at about 1,000 locations are organizing strikes to protest the early opening time on Thursday, according to Making Change at Walmart, a coalition of employees, community groups and union members anchored by the United Food & Commercial Workers (UFCW).
A petition titled "Tell Walmart to Give Thanksgiving Back to Workers and Families!" started last week on signOn.org, the online campaign platform of MoveOn.org, has more than 30,000 signatures.
Such petitions aren't likely to make retailers reconsider their decision to open on Thursday, Cohen said.
3. Midnight Madness is contagious
For the first time, many shopping centers and stores are opening at midnight Friday morning. Among department stores, Macy's also has moved up its opening time to midnight at its Grand Rapids outposts.
4. The year of the mobile shopper
If you've got a smartphone or a tablet, it's never been easier to track deals while you're in the store. Yes, you can still do product and price research at home before heading to the stores. But now you also can get price, availability updates, and discounts on your mobile device with retailers' apps or apps that aggregate information from other retailers' websites, Cohen said.
Many consumers intend to do exactly that. In a holiday shopping survey of 8,899 adults 18 years and older, 32.9 percent of those who owned a smartphone said they planned to use it to research products and compare prices, and 44.2 percent of those who owned a tablet said they planned to use their mobile device for that purpose. Consumer research firm BIGinsight conducted the study for the retail federation.
Those mobile devices are going to be used not just for researching, but also for remote browsing – on Thanksgiving Day.
Many people plan to bring smartphones and tablets to Thanksgiving dinners at friends' or relatives' homes and use their mobile devices to shop before and after the holiday meal, according to eMarketer, a research firm specializing in digital commerce and marketing.
Shoppers also are using their mobile devices and PCs to make their purchases online on Thanksgiving Day and Black Friday. Online retail spending on Thanksgiving Day last year rose 18 percent to $479 million, while e-commerce on Black Friday climbed 26 percent to $816 million, according to comScore Inc., a company specializing in digital business analytics.
5. Mobile checkout grows
Long checkout lines are a staple of Black Friday. But there's a new way around those. Retailers such as Apple, Nordstrom, Nordstrom Rack and JC Penney lead the way in using mobile checkout.
"Our salespeople can use mobile checkout devices to ring up a customer's purchase anywhere in the store," said John Bailey, spokesperson for both Nordstrom and Nordstrom Rack. "They can also use them to search our entire inventory from the palm of their hand." Customers have the option of getting their receipts via email.
For JC Penney, which rolled out its mobile checkout program several months ago, this year marks the first time the company's salespeople will be using mobile devices to help shoppers make payments via credit card during the holiday shopping season.
Apple took the mobile checkout concept a step further, eliminating the need to interact with a salesperson at bricks-and-mortar stores. Instead, shoppers can use the Apple Store app's EasyPay feature. Customers use an iPhone to scan a product, then complete the purchase with EasyPay.
6. Layaway plans return
For all the shiny new ways that retailers use to lure shoppers, at least one standby has made a comeback.
Toys R Us, Walmart, Sears and Kmart have resurrected the layaway plan, which allows shoppers to pay for their purchases in installments, usually with an open fee or service fee. Walmart, for example, charges a $5 open fee, which customers will get back in a Walmart gift card when they've paid for the item in full by Dec. 14. Sears and Toys R Us have waived the service fee for layaway purchases for eligible items bought within a certain period.
No matter which store layaway program you choose, be aware of cancellation fees and that some discounted items, such as Black Friday doorbusters, may not be eligible for layaway.
7. The big picture outlook
The National Retail Federation forecasts a modest bump in holiday sales this year – an estimated $586.1 billion, an increase of 4.1 percent, which is more than the 10-year average of 3.5 percent per year, but less than last year's sales increase of 5.6 percent.
From earlier opening times to mobile checkout to layaway plans, there are good reasons retailers are using many methods to entice shoppers: In 2011, holiday sales represented 19.5 percent of retail industry sales for the entire year, according to the federation.