But analysts and industry experts warn that Black Friday sales could be subdued this year. Earlier and bigger sales — although beneficial for strategic the buyers — hurt retailers whose margins are hurt by overstocking and rising labor costs.
Meanwhile, consumers are showing signs of fatigue after battling decades-long high inflation for much of the year. They had a little respite in October: Prices increased by 7.7% compared to the period a year ago, according to federal data released earlier this month. Although still well above normal levels, it was below analysts’ expectations. Even the wealthiest Americans feel stuck, according to polls. They are still buying, but choosing cheaper options.
“We are in unique economic situations – inflation is at its highest level in 40 years and many families’ budgets are being squeezed on all fronts,” said Jie Zhang, a marketing professor at the University of Maryland. “So there’s not as much excitement to open wallets heading into this holiday shopping season.”
Third-quarter financial results, consumer surveys and retail sales data offer insight into how Black Friday could play out. Last week, the Census Bureau reported that retail sales jumped 1.3% in October. But much of that spending was on basic necessities like food and gasoline. Americans also continued to retreat from technology and devices.
These numbers are important to economists and policymakers because consumer spending accounts for more than two-thirds of the US economy. The demand for cooling raises fears of a recession. At the same time, the Federal Reserve tried to lower prices by raising interest rates. The labor market remained strong, which helped consumers continue to spend.
In his vacation forecast, the National Retail Federation said sales would increase 6-8% across all categories and digital purchases would increase 10-12%. Estimates are not adjusted for inflation. The average shopper will spend $832.84 on gifts and vacation items, the NRF said, which is the 10-year average.
Over the past few years, the novelty of Black Friday, which takes its name from the fact that the rush of sales could turn retailers’ books from red to black, has slowly waned.
The big shopping day used to be synonymous with great deals and long lines before dawn. Sunil Singh, 61, used to look forward to Black Friday – not only for the deep discounts on tech gadgets, but also because it meant spending time with his son. The two had a tradition of lining up before sunrise outside Best Buy in the San Francisco Bay Area in anticipation of its opening.
“All this waking up at 4 a.m., standing in line, you know, drinking hot cider and coffee in line, waiting two hours, chatting with people, it was just a really fun time,” Singh said. , of Mountain View, California .
But when her son grew up and online shopping became easier and more prolific, there was no longer a need to show up for in-person sales.
“The offers, you can get them online,” he said. “You get such good deals weeks, ten days in advance. So it’s not that significant anymore.
“It’s lost its novelty,” Singh added.
The rise of e-commerce has shattered the Black Friday shopping experience. Today, retailers are making it easier than ever to buy on their websites, apps and in-store, said Harley Finkelstein, president of e-commerce platform Shopify.
“I think Black Friday, Cyber Monday [have] kind of turned from a weekend into a season,” Finkelstein added. “And I think consumers like that because it means they can do more shopping sooner.”
Buyers are also increasingly dependent on social media: A global survey by the IBM Institute for Business Value, in association with the National Retail Federation, found that 6 out of 10 buyers draw “inspiration and ideas” from TikTok, Instagram and other sites. Platforms enable a seamless shopping experience, and with young people spending more time on apps, brands and companies are bringing their products to them.
But retailers are still making efforts to bring people back to stores, said Shawn Grain Carter, a professor at the Fashion Institute of Technology.
“If you go to the physical store, they often have extra sales because they’re trying to drive traffic,” she said, adding that after years of covid scares and crowd restrictions, shoppers want to be back in the stores. “The pandemic has forced more consumers to realize they want human connection and contact.”