Black Friday Draws Younger Shoppers
Retailers may have lured more shoppers on Black Friday as an earlier start to their bargain bonanzas drew younger consumers.
Toys “R” Us Inc. opened at 9 p.m. on Thanksgiving, an hour earlier than last year. Wal-Mart Stores Inc. (WMT) started offering its deals one hour later, followed by midnight openings at Macy’s Inc. (M), Best Buy Co. and Target Corp. (TGT) that drew young consumers to the biggest retail day of the year for the first time.
“It was definitely a younger customer, under 20 for the most part, and they were shopping in groups of friends, four and five at a time,” Macy’s Chief Executive Officer Terry Lundgren said yesterday of the crowd of 10,000 that waited at the chain’s flagship store in Manhattan. “It was almost a continuation of whatever social experience they were having hours before.”
Black Friday arrived with consumer sentiment at levels previously reached during recessions, as a record share of households said this is a bad time to spend, according to the Bloomberg Consumer Comfort Index. The measure has reached minus 50 or less in nine of the past 10 weeks, an unprecedented performance in its 26-year history.
Even with low confidence, sales may have gained from a year earlier as shoppers paid more for goods and unleashed some pent- up demand, said Craig Johnson, president of consulting firm Customer Growth Partners. Revenue from Black Friday may grow to $27 billion, an 8 percent increase from the same period a year ago, Johnson, whose firm is based in New Canaan, Connecticut, said in a telephone interview.
Good Early Sign
“The increase in consumers is a good sign early, but it doesn’t necessarily mean the overall holiday is going to fare much better than last year,” said Marshal Cohen, an analyst at Port Washington, New York-based NPD Group. People are spending about the same as last year while “nothing has shown us it’s going to be great, and nothing has shown us it’s going to be terrible,” he said.
Sales at brick-and-mortar stores may rise 2.8 percent to $465.6 billion this holiday season, slower than the 5.2 percent gain last year, according to the National Retail Federation. Online revenue may advance 15 percent to $37.6 billion, according to ComScore Inc. (SCOR) As many as 152 million people were expected to shop at stores and websites on Black Friday, up 10 percent from last year, according to the Washington-based NRF.
“It was a win for them,” said Perkins, who visited stores in Boston. “The additional costs of staying open a few more hours will be more than offset by the traffic they brought in and probably taking some market share.”
Macy’s Drives Traffic
Macy’s decision to start Black Friday earlier also prompted many malls to open at midnight. That helped boost foot traffic at Walt Disney Co. (DIS)’s namesake stores because Macy’s serves as the anchor tenant in the malls the house most of its locations, said Jim Fielding, president of Disney Stores Worldwide. Sales at Disney Stores rose high-single percentage points to meet expectations, Fielding said.
The extended hours drew Amanda Rottmueller, a 20-year-old nursing student, to Black Friday for the first time as she bought herself bras and pajamas that came with a free pair of slippers from Limited Brands Inc.’s (LTD) Victoria’s Secret at the Tri-County Mall in Cincinnati.
“The deal is just too good, and I can get something really nice I wouldn’t be able to afford otherwise,” she said.
The move to turn Black Friday into more than just one day also grew on the Web as online retailers, such as Amazon.com Inc. (AMZN), began advertising “Black Friday” deals well before yesterday. Online sales gained 39 percent on Thanksgiving and 18 percent by noon New York time, according to International Business Machines Corp.’s Coremetrics.
Kristen Gartland, a 20-year-old waitress, also tried Black Friday for the first time by starting at a Wal-Mart in Huber Heights, Ohio, at 10 p.m. and then Kohl’s at midnight. She said she planned to double her shopping budget to $350 from a year ago because she has made more money serving wings at a sports bar in nearby Miamisburg, Ohio.
Barb Steck, a 45-year-old Washington resident, also expected to double her holiday spending to “thousands” this year because the family construction business is doing well and she had pent-up demand. She got rid of some of that yesterday, spending $400 on shoes and pants at Michael Kors and Lululemon Athletica Inc.
“I haven’t done a lot of shopping recently,” Steck said. “I am starting to shop now for myself.”
Many shoppers, including 39-year-old Tanya Taylor from San Diego, planned to cut back on holiday purchases. Her spending will drop by 50 percent because her freelance work in the beauty industry has declined, she said while shopping for her own clothes at a Macy’s at the Westfield Horton Plaza Mall in San Diego.
Gap Inc. (GPS), based in San Francisco, took the early openings one step further by boosting the number of stores open on Thanksgiving morning to about 1,000. Most of them were Old Navy locations, which offered women’s coats for as little as $14.75, or about 50 percent off, and scarves for $5, down from $7.94.
An Old Navy store in Greensboro, North Carolina, opened at 9 a.m. on Thanksgiving, attracting Paula Pile, a marriage counselor. She shopped for socks, pajamas pants and a $19 vest for her granddaughter, before heading to dinner with family.
By opening on Thanksgiving, Old Navy “is picking up my business,” said Pile, 57. “I am not one to get up in the middle of the night and go stand in line.”
Black Friday may illustrate a gap between what consumers tell pollsters and how they actually behave -- a trend that has prevailed for much of this year, said Retail Metrics’ Perkins. Industrywide monthly same-store sales, a key indicator for retail growth because new and closed locations are excluded, have gained for more than two years and missed analysts’ projections once this year, according to Retail Metrics.
“A solid Black Friday suggests the rest of the season should be pretty good,” Perkins said. “Those who have jobs have been willing to spend.”
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