Hype-y holidays: ‘Black Friday’ and other nonsense
Brace yourself. The media hype around Black Friday and Cyber Monday is now at a fevered pitch. Don’t fall prey to the nonsense.
But you can rest assured that as we emerge from a tryptophan-induced haze Friday morning and turn on just about any news outlet you will witness some hapless reporter standing in a mall–or outside a (insert well-known national retailer name here)–opining about whether various “indicators” (number of people in line at store opening, whether shoppers are carrying full shopping bags and so on) bode well for retailers’ fortunes. Alas, Black Friday has always been far more media trap than sign o’ the times. There are several reasons for this.
Black Friday is not the biggest shopping day of the year.
The Saturday before Christmas and the day after are often the highest volume. In fact, if recent history is any indication, several days right before Christmas will likely rival Black Friday’s sales numbers. So while it’s an important day, it’s hardly a huge contributor to overall holiday season sales.
Black Friday revenues are on the decline.
As online shopping continues to grow, the relative share of total holiday sales done in stores on Black Friday is decreasing markedly. A recent survey suggests another down year. With some stores opening on Thanksgiving Day–and more and more Black Friday deals breaking early–revenues are being spread out over more days, rather than concentrated on the traditional “holiday” of massive consumption. Our friends at Amazon even launched their deals 50 days early this year.
For consumers, it’s mostly a con.
Study after study shows that, with few exceptions (mostly the heavily promoted, limited quantity “doorbusters”), the deals just aren’t that good. In fact, prices tend to be better in December or during traditional clearance periods.
The customer experience is terrible.
With overflowing parking lots, teeming throngs, long checkout lines and, in some cases, a need to camp out hours before the doors open to have a chance of scoring an actual great deal, shopping on Black Friday is the ultimate soul-crushing hassle. Apparently, some people thrive on this sort of thing. I hope they get the help they need. Oh, and many of the deals are recycled anyway.
Black Friday success (or failure) is meaningless.
With all the attention Black Friday gets you might think that a given retailer’s performance would be highly correlated with how its overall season will turn out. You’d be wrong. Over the years, many folks have tried to determine this correlation and haven’t found it. One study even found a somewhat negative relationship. So move along. Nothing to see here.
What about profits?
While we’ll have to wait to see how Black Friday and Cyber Monday turn out, we can be fairly certain that it won’t be particularly profitable. This year’s retail industry exercise in group-think will have the predictable effect of compressing product margins and driving up operating costs all in the name of defending market share.
Of course with many retailers running scared or even fearful of their continued existence, few have the discipline to approach the season with any kind of restraint, promotional or otherwise.
A version of this story appeared at Forbes, where I am a retail contributor. You can check out more of my posts and follow me here.
For information on speaking gigs please go here.
Originally published at stevenpdennis.com on November 24, 2017.