John Akerson's Thoughts

Business, technology and life

Black Friday is Dead

Black Friday, the Friday after Thanksgiving, is a day that combines a recipe of these ingredients: pent-updemand, planning for holiday gift giving, end of year bonuses, excessive credit, retailer desires, and a deluge of advertising across all forms of media. It is one day, marked in black, when retailers theoretically break even for the year. It is a day that serves as a standard measure of the economy.

According to USA Today, “Last year, the Thanksgiving shopping weekend accounted for 12.3% of overall holiday revenue, according to ShopperTrak. Black Friday made up about half of that.”

Link to Tombstone Maker
Black Friday is dead. Why? It is dead because people love options and alternatives, because some people hate crowds, and most of all because every retailer is now offering more and more options. Here are a few: Buy online, buy on Thanksgiving day, buy on Cyber Monday, buy a week before Black Friday, buy the week after or on any of the shopping days between Thanksgiving and Christmas, or – simply choose not to buy.

Breaking news today shows Black Friday sales rising modestly or enormously, but each article is just showing a small piece of the Black Friday pie.

Here’s some information from Yahoo: “U.S. online sales were up 33 percent on Thanksgiving this year, according to IBM Coremetrics, signaling irresistible promotions in advance of Cyber Monday, the kick-off to the online holiday selling season.”

Major media outlets like Reuters are saying that U.S. retail sales on Friday rose a mere 0.3 percent from the same period last year, while traffic rose 2.2 percent, ShopperTrak said. Heavily discounted merchandise may increase volume, but negatively skews sales data while cutting into profit margins.

But that is just a little piece of the real story. Paypal money transfers increased enormously, and further, Paypal data suggests that the “shopping season began on Monday, November 15, 2010.”

 How significant is that?  Here are some other tidbits of data: 

“Black Friday 2010 resulted in 21 percent more total payment volume compared to Thanksgiving 2010. PayPal saw 19 percent more payment volume on Black Friday 2010 compared to an average Friday in 2010.  PayPal processes 16.5 percent of U.S. eCommerce and 15 percent of global eCommerce.”

So – is there a 0.3% increase? Or a 27% increase?   Experts had forecasted a 2-3% increase

And many enormous retailers were open on Thanksgiving day. (Including  Sears, Toys ‘R’ Us, Kmart, Walmart, Gap, Old Navy and others) My local CVS pharmacy was open until Midnight on Thanksgiving. Many of these retailers had Black Friday deals available early. Many online businesses offered Black Friday deals early.

The cumulative effect is that Black Friday isn’t comparable to last Black Friday because the buying has been moved to a multiple-day, multiple medium affair. What was once confined to a day and a physical location is now everywhere over several weeks.

Black Friday is dead. We will still have a “Black Friday”, and will still call it Black Friday, but sales will begin earlier and earlier and last later and later. Combining that flexibility with online sales will mean that at some point, we might start calling it “Black November-December”  Whatever it is, and whatever it is evolving into, it isn’t Black Friday anymore.

What do you think?

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November 28, 2010 Posted by | Business, Life, Marketing, Social Media | 1 Comment