The Changing Role of Black Friday

Aug 25, 2016

brick and mortar

Black Friday, the Friday following Thanksgiving, has been regarded as the beginning of the holiday shopping season in the U.S. since at least the 1930s. For many retailers it’s the busiest—therefore the most important—day of the year. In recent years the shopping frenzy has started long before Thanksgiving and a larger percentage of that business is happening online rather than in the store.

In 2015 we saw a major shift in consumer shopping habits that left many wondering about the future of brick-and-mortar stores. In-stores sales for Black Friday fell 10% while online sales rose 15%. The shift in consumer shopping habits was a major contributor for the disappointing in-store sales performance.

In addition to changes in consumer behavior and preferred methods of shopping, retailers have also played a role in diluting the impact of Black Friday. “With holiday promotions beginning just after Halloween, the impact of Black Friday as a day for shoppers to ‘find the deals’ has certainly been diluted the past couple of years,” says Pam Goodfellow of Prosper Insights & Analytics.

The Black Friday Tradition is Changing

Like many families, mine has a tradition of heading to the stores on Black Friday to take advantage the super sales. For the past few years, our pre-shopping routine includes researching the best deals on our smart phones and tablets before heading out to the stores. It's not unusual that one or two of the stores gets crossed off the list and the purchase is made online.

Physical stores are a long way from becoming obsolete, but the way stores operate will change tremendously over the next several years. Consumers will become more and more comfortable ordering online and it’s likely that on-demand delivery services that deliver goods within one hour, like Amazon Prime, Google Express and Uber, will drive a decrease in the retail footprint.

Retailers with a brick-and-mortar presence will need to up their game and make it as easy as possible to transact through digital channels in addition to finding innovative ways to drive traffic into the stores.

It’s doubtful that Black Friday will become a thing of the past, but my bet is that it’s going to be a very different experience in the not too distant future as retailers evaluate the current deep discount strategies.