This article is by Charles R. "Ray" Taylor, the John A. Murphy professor of marketing at the Villanova University of Business and senior research fellow at the Center for Marketing and Consumer Insights.
The term “Black Friday” is thought to have originated in Philadelphia about 55 years ago, and initially referred to the congestion and crowds caused by the busy shopping day that occurs on the Friday immediately following Thanksgiving. Over the years, however, the term “Black Friday” came to be associated with profitability and the notion of retailers swimming in “black ink” as a result of making many sales.
The last few years have seen Black Friday sales at retail stores apparently reach their peak. In 2015, brick and mortar retail sales on Black Friday declined by about 5%. With the advent of “Cyber Monday” and retailers offering many deals earlier than before has led some to argue that Black Friday should now be called “Gray Friday” due to its decline. While it is true that Black Friday has probably passed its peak, there are good reasons for this. At a macro level, the underlying reasons for the slowdown in Black Friday sales are good for consumer and goof for retailers.
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A big part of the shift away from Black Friday as the central focus of the holiday shopping season has to with retailers responding to consumer trends – and a good portion of these trends are driven by wants and needs of the millennial generation. One major shift has been that retailers are now offering Black Friday deals earlier than before. Driven by aggressive online deals from Amazon (and now other retailers), the season now starts immediately after Halloween. One reason this makes sense is that surveys are showing that, in contrast to the baby boomers and even gen x, millennials actually prefer a longer holiday season. In fact, if you hear somebody complaining about store shelves being stocked with Christmas items late in October, it is probably an older person doing the complaining. Many younger shoppers also prefer the shopping season being spread out.
Millennials are also adept at using shopping apps. The availability of shopping apps such as Nifti and ShopSavvy, along with the app named Black Friday help young consumers find the very best deal. A recent Mindshare study shows that millennials are better than other groups at sticking to a budget, so the apps help to stretch that budget.
It can be argued that the longer shopping season is good for both millennials and consumers from other generations. Many people, especially parents, report feeling pressure to spend more than they can afford on Christmas shopping. Being able to get deals over a longer period of time can help stretch dollars further for those motivated to find the details.
The longer holiday shopping season is also a good thing for many retailers. Having so much stake in single day led to Black Friday came with risks for retailers. With purchases being spread out more, retailers have more time to adjust to consumer preferences and competitor strategies.
It is unlikely to lose its status as the number-one shopping day of the year based on the structure of the four-day Thanksgiving holiday weekend, but it won’t account for the percentage of holiday shopping purchases that it once did. Given that the reasons for this involve better serving customers, it seems fair to say that Black Friday is not dying, but rather graying gracefully.
