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Shoppers at both brick and mortar stores and online storefronts

A number of consumers have decided to trade in the hustle and bustle of going to the mall to take advantage of big holiday specials for the peacefulness and ease of online shopping, with many online shoppers finding similar if not comparable deals on the web

As a student of marketing, Black Friday is one of the most interesting times of the year to examine. Historically, it has signaled the kickoff point for the holiday shopping season. On Black Friday retailers typically offer significant deals on products to induce shoppers to come in; and in many cases those same retailers will feature at least one or a few “doorbuster deals” in limited quantities that are sold below cost to help stir up a shopping frenzy. Some people will set up camp outside of their favorite retailers to help ensure that they are able to get the best items. With the addition of Cyber Monday at the beginning of the following week, the period from the Friday following Thanksgiving to the Monday after Thanksgiving marks a time when a significant amount of purchases are made and for many retailers this period serves as a pivotal marker of how they’ll fare during the holiday period.

Retailer Dependency on the Holiday Period

Retailers know that the holiday shopping period is a time when consumers go out (or go online) and treat themselves and the ones that they love to gifts. It represents a significant opportunity for both physical and digital shops to capture valuable sales. As noted in an article in Bloomberg Businessweek, for some businesses holiday shopping during November and December defines whether their businesses are able to stay afloat. Shutterfly, a company that features a website where people can construct online items such as holiday cards, calendars, and pillow cases featuring their personal photos attributes over 50 percent of its revenue to the last three months of the year. Brick and mortar space companies such as GameStop, Best Buy, and Macy’s see over one third of their annual revenue come in during the last quarter of the year. When this is taken into consideration it starts to become easier to understand why many of these businesses compete so fiercely with each other (on price in most cases) during the holiday season. This all begins with Black Friday, or at least it used to.

Thanksgiving: A Time for Friends, Family… and Shopping?

In the race to capture holiday shopping dollars over the past few years more retailers have chosen to open on Thanksgiving. Some businesses choose to open at the start of Thanksgiving Day while others opt to open in the afternoon or evening. The logic to be open on Thanksgiving makes sense if you assume (just to begin with) that consumers have allocated a certain amount of their budget to holiday shopping in advance of the season. With this assumption in mind it stands to reason that the sooner a business can close on those holiday purchases the better, especially in a competitive environment. Another thought supporting the value of being open on Thanksgiving relates to the position that for many consumers shopping on Thanksgiving Day is an attractive option since the shopping experience will be less frantic then and more of what they want will still be available.

If you’re a retailer that decides to open on Thanksgiving Day and one of your competitors opens a day later on Black Friday then another advantage might be that you’re able to capture a bigger piece of the holiday pie for your respective segment of the market. This is one of the factors that probably make it difficult at present for many retailers not to open on Thanksgiving Day. Even when considering other factors (such as asking employees to work who would rather be with their family) it would be hard to pass up the opportunity, especially if you expect your closest competitors to be getting in on the action.

An interesting article in the Washington Post in fact looks at how some companies have attempted to leverage the decision not to open on Thanksgiving Day as an opportunity to gain some good publicity and promote their brand image. Companies such as Costco, Nordstroms, and GameStop, to name a few, have opted to stay closed on Thanksgiving Day. Some of these companies have been assertive in communicating to the public that the decision is driven by the belief that employees should be allowed to spend time with their family on Thanksgiving, while others have connected the decision to stay closed on Thanksgiving to other, perhaps less polarizing factors. Some Facebook pages have been setup by people to help gather support to get consumers not to shop on Thanksgiving. The “Say No To Shopping on Thanksgiving” Facebook page has gathered over 66,000 likes, while the “Boycott Black Thursday” Facebook page has generated close to 120,000 likes.

E-Commerce: A Source of Competition and Support for Brick and Mortar Focused Retailers

For many retailers, offering specials online starting the night before Thanksgiving through Cyber Monday is another option to supplement or compliment the decision to open their doors on Thanksgiving. Walmart reported that Thanksgiving was its second largest ever online sales day behind last year’s Cyber Monday sales numbers. Walmart did decide to open its stores on Thursday as well this year. Perhaps there is some potential for retailers with largely a brick and mortar presence to use their online capabilities as a substitute for opening their doors on Thanksgiving Day.

As more consumers spread their shopping activities out over Thanksgiving Day, Black Friday, the weekend, and Cyber Monday it has been noted that Black Friday crowds have appeared to lessen at physical locations. An article on Reuters’ website goes into greater detail on the trend of shoppers to spread out over multiple channels, mediums, and days to capture holiday deals. Holiday sales during November and December are predicted to grow by over four percent this year according to the National Retail Federation with online sales already seeing significant growth, but the specific sources of this growth aren’t all equal.  Some larger Ecommerce site have seen such high levels of use that they have suffered significant performance issues over the start to the holiday shopping season or gone down for periods of time. It seems that more consumers are getting into the holiday spirit and with the kickoff of the holiday shopping season these consumers are exploring more opportunities both online and offline in their pursuit of relevant deals.

From a marketing management perspective here are some questions to consider:

  • As a marketing manager in charge of promotions for a brick and mortar retailer on Black Friday what are your main goals for your company’s promotions and “doorbuster deals?” What types of metrics would you be most interested in examining to understand how effective your promotions were in meeting your stated goals?
  • GameStop is mentioned a few times in this post as a company that is both heavily reliant on holiday sales (40 percent of its revenue in 2013 came from the fourth quarter) and a company that has made the decision not to be open on Thanksgiving Day. Do you believe that this is the right strategy for the company to take? Why or why not?
  • As the marketing manager for a company that has chosen to keep its brick and mortar stores closed on Thanksgiving Day what metrics would you be interested in capturing to measure the impact of the decision and how would you use them to draw valuable insights?