To Close or Stay Open on Black Friday?

By Brian Harris

rei-exterior

In 2008, a worker died at a Long Island Walmart after being trampled in a Black Friday stampede. Across the country that same day, gunfire broke out at a Southern California Toys ‘R Us, leaving two dead. In 2011, shoppers in West Virginia stepped over a man who had collapsed while shopping in Target; he died later at the hospital.

These are just a few of the Black Friday shopping incidents in recent memory that have shaken our public conscience. Some retailers have taken a stand against Black Friday shopping. The most recent is Recreational Equipment Inc. (REI), which announced that it plans to close 143 stores on Black Friday. The store will pay its 12,000 employees on their day off, and encourages other retailers to join them.

REI’s move is both daring and expensive move, but as Forbes reports, it’s on point not only with public sentiment but also with the brand’s mission. “We’re a different kind of company—and while the rest of the world is fighting it out in the aisles, we’ll be spending our day a little differently,” said CEO Jerry Stritzke in a statement about the decision. “We’re choosing to opt outside, and want you to come with us.” REI’s online store will still be running under the watch of a few employees, however.

The reality is that Black Friday is no longer a top sales day for many specialty retailers like REI. The privately held company sees more deals from its membership structure, and sales also pick up during the spring. They are indeed a different kind of company—in a completely different situation than big-box retailers like Target and Walmart.

“If we announced to our guests that we weren’t going to be open on Black Friday, I think we’d have a lot of pushback,” Brian Cornell, CEO of Target, told The New York Times. “It’s a very important part of the holiday season. It really is a family tradition.”

For some families, it is. For other families, Black Friday shopping as become a tradition of rejection.

Unlike Walmart and Coscto, which both can fall back on gas sales, Target just has its sales floor. Costco will be closed on Thanksgiving, while Walmart and Target will once again compete to open Thanksgiving evening. We see this trend in department stores like Sears and Macy’s, which will both open on 6 p.m. on Thanksgiving this year.

What is Important to Your Brand?

If you’re a specialty retailer like REI, can you afford to set yourself apart and stay closed on Black Friday? It may be an option worth considering, since it will call attention to your brand in a positive light. If you’re a big-box retailer or a discount retailer trying to compete with a big-box retailer, it unfortunately looks like you’re back to the grind this holiday.

Maybe more retailers will follow the path of GameStop and Staples, which are both opening later on Black Friday, and remaining closed on Thanksgiving.

If you’re a big-box retailer or a discount retailer trying to compete with a big-box retailer, it unfortunately looks like you’re back to the grind this holiday.

The Retail Turkey Returns

Last year, the National Retail Federation suggested that spending had become more dispersed across the holiday season, if not the entire year. This year, the industry group predicts that sales for November and December will rise 3.7% to $630 billion, below last year’s 4.1% gain.  Sales during the holidays represent nearly 20% of the retail industry’s annual sales of $3.2 trillion, reported the Wall Street Journal.

Unfortunately, Black Friday door busters are still the big fat turkey of holiday sales for so many of America’s largest retailers. It’s been this way for at least a decade as toys have become more interactive and more expensive and, generally speaking, middle class spending habits on everything from gadgets to clothing/accessories have gone upscale.

Black Friday has become the balance of the American dream and a perennial nightmare. If the pattern won’t reverse, it may one day just become obsolete with Internet sales.

Subscribe to Zenput's Blog