Star Tribune

Latest news

Retailers search for limit of our desire for holiday deals

Black Friday is starting to get a little gray around the temples.

Article by: THOMAS LEE , Star Tribune

Updated: November 21, 2011 - 7:32 AM

Black Friday is starting to get a little gray around the temples.

From early morning "door buster" promotions to stores "leaking" Black Friday deals before the actual day, retailers have sought to whip up as much excitement as they can on what is the traditional start to the holiday shopping season. And now this: Such retailers as Best Buy, Target, and Wal-Mart are opening their doors at midnight on Black Friday or even on Thanksgiving night.

Experts and even some retailers admit that the tactics don't really boost sales and profits the way television footage and newspaper photos of mobs bursting through doors suggest they do. The over-the-top retail frenzy is more defensive in nature: Stores need to open earlier, cut prices deeper, scream promotions louder because they don't want to lose sales to rivals.

"If this was a real day for engagement and sales, then why the [heck] are you opening up earlier and earlier?" said Robert Passikoff, president of Brand Keys, a consumer research firm based in New York.

Retailers, experts say, are running out of tricks to wow tech-savvy, hardened consumers who only want to grab a $200 laptop and a bargain-priced flat-screen television and nothing else. And in their zest to up the ante, retailers seem to be alienating some shoppers unhappy at the prospect of trudging to a Target or Best Buy on Thanksgiving night instead of early Friday morning.

One resident in New Jersey started an online movement called "Respect the Bird," which asks people to sign a pledge "to not let Black Friday shopping gobble up my Thanksgiving." Some employees are taking to the Internet as well. Best Buy and Target employees have started online petitions to protest the midnight openings and have already attracted tens of thousands of signatures.

Black Friday -- and even the holiday shopping season -- have been gradually losing importance to retailers' bottom lines.

Sales of apparel, furniture, and general merchandise between November and December made up less than 22 percent of retailers' annual sales last year, compared to more than 25 percent in 1988, according to the International Council of Shopping Centers (ICSC). In 2008, the year of the Great Recession, that number dipped below 21 percent.

Retailers generally argue that Black Friday gives a much needed jolt to holiday sales. At the very least, Black Friday does push shoppers into the stores so they can see merchandise they may buy later, said Carol Spieckerman, president of newmarketbuilders, a retail consulting firm in Bentonville, Ark.

"I don't know if retailers have the ability to quantify" that jolt, she said.

Despite extended hours and a full slate of holiday promotions, Target, based in Minneapolis, expects sales at stores open for at least a year to rise 4 percent or less in the fourth quarter, compared to a 4.3 percent comparable-store gain in the third quarter. So it seems Target's holiday efforts generate, at best, a modest impact on fourth-quarter sales.

Passikoff of Brand Keys says retailers aren't reaping big gains from holiday sales because there are too many of them and they're all selling the same stuff. So retailers must get creative.

Best Buy, for instance, is screening "Harry Potter and the Deathly Hallows" on large outdoor screens in select markets on Thanksgiving night. Old Navy is giving away 3D glasses in San Francisco, Chicago, and New York. Gander Mountain, based in St. Paul, declares Thanksgiving to be "Camo Thursday," where its stores sell camouflage apparel at steep discounts.

However, retailers frequently and quickly copy each other, making it hard to impress consumers, said Dave Brennan, a professor of marketing and co-director of the Institute of Retailing Excellence at the University of St. Thomas.

Take the earlier store hours. Just days after Target and Mall of America said they would open at midnight, Best Buy followed suit and Wal-Mart said it would open its toy and electronics departments at 10 p.m.

"Some people think if you have more hours, you will have more sales," Brennan said. "In reality, you're just redistributing the sales over a broader amount of hours."

Some retail executives say they have no choice but to mimic the move for fear of losing ground to competitors. At a recent conference, Best Buy CEO Brian Dunn responded to a question on Twitter about whether the midnight openings violated the company's support for social sustainability.

"We recently had to make a difficult decision," Dunn said. "We were going to be open at a much more civilized hour. At Best Buy, we need to be where our customers are. The market has moved to a midnight hour."

"I feel terrible because it will change some Thanksgiving plans for our employees," he said. "I know that the decision has been a bit controversial with some of our folks. The truth of the matter is that consumers will be lined up around the building for that midnight opening."

Indeed, Black Friday remains a powerful draw for many consumers, whether the stores open at midnight or 5 a.m.

For the past two years, Jamie Hanson, 25, of Shoreview, huddles with her two best friends on Thanksgiving night to plot their strategy for Black Friday morning. While Hanson prefers the usual 5 a.m. openings, she says the group will hit Target at midnight.

"It's kind of a crazy thing," she admits. "But it's not so much about the actual items we come away with but rather [upholding] a holiday tradition with my friends."

Thomas Lee • 612-673-4113

| Back to top

more from Latest news »

Home | Latest news | Local | Sports | Business | Politics | Opinion | Entertainment | MN State Fair | Lifestyle | Nation | World | Weather | Daily Deals | Obituaries | Homes | Rentals | Jobs | Movie Finder
| Back to top | | News apps | Help | Manage Subscription