Looking Ahead to Black Friday
Thanksgiving is here, which for some people means the start of a month of overeating. For others, of course, it marks the start of a month of overspending, kicked off by Black Friday.
This year, the competition is particularly fierce, and all eyes will be on the results. For many retailers, Black Friday marks the point where the year's ledger moves from red to black; hence (some stories have it) the name. Last year, of course, that didn't happen for a lot of retailers, as panicked consumers hunkered down. Even at places where spending was up, profits were often down, because they had to discount so deeply in order to get customers through the door.
With consumer economic indicators improving slightly, this year is expected to be a little better. But for retailers, the price environment remains ferocious. Competitors are frantically trying to counter Wal-Mart's deep discounts to lure the elusive consumer into their doors: Target is giving away $10 gift cards to those who spend more than $100, while JC Penney is offering recorded wake-up calls from celebrities to help you get out of bed for their 4 am open.
One of the most noticeable effects of this competition is that Black Friday seems to be creeping back towards Thanksgiving itself. Amazon started its Black Friday deals on Monday, staggering them so that there's something new to shop for every few hours. And Wal-Mart is staying open on Thanksgiving, ostensibly in order to prevent the traditional crushing deaths that regularly occur when they open their doors. There's a good chance that I will take a nap and then head out to our nearest Wal-Mart to blog it for you, and also (she mumbled) to maybe buy a Cricut Expression for all the wedding stuff we have to make over the next six months.
The real test, though, will not be when the Black Friday numbers come out in a few days. Rather, it will be whether retailers can sustain a decent sales level without phenomenal discounts (that Cricut Expression is more than $100, or 30%, off). We won't know that for several weeks, at least, and probably not until after the New Year.