Black Friday and Local

This Thursday is the US Thanksgiving holiday, so Friday marks the official start of the holiday shopping season for a large percentage of US consumers. Infamously known as “Black Friday” (for profit potential), many “big box” retailers will open at midnight or in the early morning hours to longs lines of consumers hoping to capture deals on limited supplies of heavily discounted consumer electronics, toys, apparel and so on. Indeed, Black Friday shopping has become something of a sport for people who are willing to brave the crowds, lines and frequent “bait-and-switch” retail tactics. The following Monday was dubbed (by Shop.org) “CyberMonday” in the hopes of capturing some of the same behavior and buzz associated with the start of holiday shopping.

Over the past several years, Black Friday promotions have become critical for retailers in building excitement and early momentum to help kick off holiday sales. It’s somewhat analogous to an over-hyped movie opening. But one of the big frustrations of the day for many shoppers is missing inventory: waiting in line only to discover that the 15 sub-$300 laptops advertised have already sold out.

Black Friday deals have historically been published in newspaper inserts, but increasingly websites such as bfads.net have also arisen to offer a sneak preview of deals. One might have expected the rise of e-commerce to dampen the enthusiasm for Black Friday somewhat – but it hasn’t. Some of the most affluent shoppers – those most often associated with e-commerce purchase behavior – are on record planning to be in the store on Friday morning. According to a poll conducted by the Maritz Retail Research Group, “44 percent of those with household incomes between $75,000 and $100,000 [are] planning to shop on Black Friday.”

Years ago, many pundits thought that e-commerce would cut the legs out from under in-store shopping because of its perceived convenience and, many thought, price advantages. And while e-commerce has grown impressively in the past several years, it’s now struggling as more consumers use the Internet instead to conduct product research before buying in local stores.

E-commerce is expected by both JupiterResearch and Forrester, to flatten over the next few years, while Internet-influenced offline shopping will continue to grow. Both firms say that while online sales will “plateau” at 10 to 15 percent of US retail, the Internet will influence $1 trillion in consumer spending within the next five years.

Depending on the particular survey and product category in question, anywhere from 70 percent to 90+ percent of consumers now consult the Internet before buying in stores. However, the still-missing link in this process is the widespread availability of product inventory data to connect online shoppers with places to buy things in their markets.

The rest of this post is at SEL.

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