Black Friday’s Evolution Into Weeklong Event Seen As Here to Stay
Staggered deals, flash sales and doorbuster price guarantees amid the spread of Black Friday frenzy into a string of named deal days are trends that are likely here to stay, said Shawn DuBravac, CEA chief economist and director of research, on a webcast Tuesday. DuBravac noted a stronger push this year toward pre-Black Friday sales, as retailers sought to spur consumers into spending early rather than waiting for Black Friday bargains.
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Electronic event-driven marketing was at an all-time high for CE retailers, DuBravac said, with multiple email pings going out per day to entice shoppers. Flash deals, which DuBravac called the “Groupon effect,” picked up among Amazon, hhgregg, Best Buy and others, where customers could snatch a limited-time deal within a given window. Staggered store hours are redefining how doorbuster deals are handled, he said, noting Sears held separate doorbuster deals at 8 p.m. on Thanksgiving and at the 4 a.m. Black Friday hour, “even though they had been open for six hours.” Walmart did the same with three different launch times spanning Thursday and Friday morning and three different in-store circulars to go with them, he noted.
For the first time in “a very long time,” the average selling prices of TVs increased during Black Friday weekend, driven by higher screen sizes and features including 3D and connectivity, DuBravac said. The average wholesale price of TVs in 2012 is expected to increase slightly over last year, he said. But he also cited a 50-inch TV priced under $300 over Black Friday weekend and said: “We'll know more in coming weeks whether prices will hold."
Other emerging trends are unannounced deals that pop up in an email blast to consumers and Black Friday pricing extensions that carry over from early deals. Now that Black Friday and store opening hours have blurred, “doorbusters are going to blur as well,” DuBravac said. On how retailers will maintain Black Friday momentum, DuBravac expects retailers over the next few weeks to advertise “best of the year” prices. If consumers feel like they're getting the best deal, he said, they're more inclined to buy so retailers are expected to offer “better than Black Friday pricing” to drive consumers back into the store, he said.
CE inventory levels were higher this year than in years past, DuBravac said, and levels for doorbuster products were “very strong.” While the industry wasn’t in an “inventory overhang” position last week, he said “things were very well-stocked headed into and around Black Friday,” leaving more products available at promotional prices. Consumers historically have felt they had to “rush and fight others,” he said, and although some of that still occurred last weekend, most of the deals, beyond those at the very low end, were available for those who wanted them, he said.
The industry will remain challenged leading up to the holidays and after due to the fiscal cliff and other economic uncertainties, DuBravac said. He was cautious about first half 2013, citing “lingering concerns” from economic situations in the U.S. and Europe. “These concerns could flare up and cause consumers to retrench,” he said. He predicted consumers will slow spending following Christmas and retailers won’t do “heavy restocking,” leading to a general spending slowdown in the beginning of 2013.