The Morphing of Black Friday: An Interview with Joe Skorupa, Group Editor-In-Chief, RIS News

With many retailers now opening on Thanksgiving, Black Friday has morphed into much more than a one-day event. Joe Skorupa, Group Editor-In-Chief for RIS News, recently spoke with Supply Chain Nation as part of our Expert Insights series to share his views on Black Friday, Cyber Monday and other holiday shopping issues.

SCN: What will be the biggest surprises retailers will experience this Black Friday?

Skorupa: I think the biggest surprise is that Black Friday is losing its traditional meaning. It has a historical meaning that goes way back in retail, but it’s changing because so many of the retailers today are opening their doors on Thanksgiving. This changes the timeframe for measuring the impact, which is obviously now going to start on Thanksgiving. We’ve seen the major retailers move from opening up at a reasonable hour on Thanksgiving, at 7:00 p.m. or 8:00 p.m., to opening at 6:00 a.m. or 7:00 a.m. in the morning. This is naturally going to inspire the smaller retailers to do that as well.

So what does that mean for retail? The big surprise is that it’s going to convert the term Black Friday from a timeframe to a synonym for door-buster deals. Black Friday really stands for a shopping frenzy, and retailers want to generate that frenzy on other days as well. We have seen Walmart, for example, already begin offering Black Friday-like deals on their website. They’ve started their door-buster deals online as of November 1st. And Amazon, of course, cannot let anything go by without taking a competitive stance against it, or even leading it, so they are using the term Black Friday on their website as of November 1st and they will tell you what their Black Friday sales are at this point in time. So in my opinion, the big surprise is that Black Friday is going to be a multi-day event, a multi-week event, even a full month event, and that is taking place this year.

SCN: What will the impact be for retailers with so many now opening for Black Friday on Thanksgiving?

Skorupa: I think the interesting thing we have to take from this is how Thanksgiving has become a day where shopping has become an event on the traditional family agenda. And I don’t think this is in any way out of cultural bounds because shopping, after all, is a social event and families do it together. A lot of times when you have family gatherings around Thanksgiving and you have people coming in from other towns and states, and you have kids coming back from college, to do a social activity like shopping together is not unusual at all. It would be considered fairly normal. So I honestly don’t see much backlash occurring. In fact, I was interviewed last year by a newspaper who was anticipating a huge backlash and they were getting my opinion on what retailers were going to do when there was this big backlash against opening on Thanksgiving. I didn’t honestly see that happening and it didn’t happen—there was no backlash. I do understand there are some employees who are blogging against it, especially the 6:00 a.m. openings, but I think the retailers will work their way through that and find a way to incent or reward their employees. I don’t think you’ll see a backlash actually coming from shoppers. I think it’s just going to become another family tradition like football.

SCN: How will the continued rise in e-commerce and mobile commerce impact this holiday weekend? Will there still be a Cyber Monday?

Skorupa: I think that Cyber Monday is definitely one of the spikes that online retailers have tracked over the years, just like Black Friday for brick and mortar stores. I don’t see it going away as being a big spike in sales, certainly for online and mobile. But I do think, even historically, it has not proven to be the biggest online spike day. We have seen a day in December known as free-shipping day when there is a guarantee or an expectation that anything ordered by that time will be delivered by Christmas Eve, which makes everyone in a gift-giving mood feel reassured about  placing their order.  So that actually turns out to be an even bigger online shopping day.

I have something else that I want to note about mobile and online commerce. That is the fact customers don’t feel they are being well-served by retailers when they get their holiday promos, messaging and alerts. They actually feel like those are mass-blasted e-mails, ads or promos and are not personalized to their interests. I think that will be an important strategy for retailers once they get that right. I know there have been many tests where they have been able to personalize e-mails and promos based on customer preferences and the conversion rates jump from the traditionally very low, single figure conversion rates to being high into the double digits, as high as 60 percent in some cases. So I think that is going to be the big difference as retailers begin to create personalized and relevant promo offerings through e-commerce and global commerce channels.

SCN: Do most retailers have the right technology to take advantage of consumers’ shift toward online and mobile holiday shopping? If not, what are they missing?

Skorupa: I think they’re getting there. I like to think that responsive design is gradually moving its way to the mainstream of retail. Sophisticated retailers are ensuring that they design once and display on multiple devices through responsive design. So when a shopper is sitting in front of their TV watching the football game using an iPad or smartphone to access a retailer’s site, they’re getting a good shopping experience that is actually designed for that form factor. I think a lot of retailers have a ways to go to make that happen.

Let me focus on one other thing as far as technology goes. It sounds like an easy thing, that it has been around forever, and yet we know that only 20-25 percent of retailers effectively offer buy online, ship to store. Part of the reason a lot of national retailers don’t offer that effectively is that it is truly hard to do. At least it’s hard to do cost effectively. You can do it and lose money, but retailers are reluctant to take that step, unless you are Amazon. I think that is one type of technology that mainstream retailers don’t have today. If they think about their most valuable customers, and those are multi-channel customers, if they can serve those customers better and get the technology to offer order online and pick up from store effectively, I think that is one area where they could seize the opportunity and grow their businesses for next year.

SCN: Thanks for those great insights, Joe, and thanks to RIS News for always keeping us up-to-date on the trends in retail.

  6 Comments   Comment

  1. From an analysis and benchmarking standpoint, I think it will be interesting to see how retailers who have historically reported financials based on a more rigid definition of “Black Friday” conduct year-over-year comparisons once a significant portion of revenue moves forward into the Thursday of Thanksgiving and beyond. I foresee complicated restatements in the future in light of the fact that using traditional definitions will make it appear that year-over-year sales figures decline.

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  2. Interesting interview. I’m curious to know what Black Friday looks like in the long run. Retailers have moved from early Friday to late Thursday to early Thursday, all in the hopes of getting customers to their store first. Clearly, this logic isn’t sustainable. Taken to the extreme, retailers will continue to push their sales back further and further ad infinitum, or we will be in a perpetual state of doorbuster deals.

    Both of these scenarios sound ridiculous, so what do you think will prevent this from happening? You mentioned the social aspect of shopping where families who are finally together on the holiday go out and shop together. Do you think that Thanksgiving day is the farthest back that Black Friday can go given that everyone has that day off of work?

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  3. According to estimates from the National Retail Federation, Black Friday weekend spending slipped this year for the first time since 2009! I always prepare for Black Friday and try to buy the bulk of my technology upgrades at midnight after Thanksgiving. This year, I found that I was able to get the same deals earlier in the month so I skipped Black Friday for the first time in a while. It makes more sense for traditional and online retailers to stretch Black Friday as long as possible. This year felt extreme with so many retailers using price contrasting and markups going into the shopping holiday. A 25 % reduction was often the result of a 15% markup in October. As online retailers continue to take up more and more market share, I wonder if Brick and Mortar stores will look to expand or contract the Black Friday shopping extravaganza. Any thoughts?

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  4. No doubt that rigid definitions of Black Friday, sales online versus off-line, and how much of the sale was influenced by social media will become complicated. The issue of increasing retail complexity is a major force to contend with right up there with the increasing pace of innovation.

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  5. Retailers want to avoid EDLP for a sustained period of time. Even Walmart, which opened early on Thanksgiving and began promoting doorbusters in early November, does not want to engage in a race to rock-bottom prices. Data shows that Walmart actually began raising prices (on average across its product mix) in the run up to Thanksgiving and by the time Black Friday it prices had climbed 5%.

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  6. Yes, Black Friday sales slipped, but overall sales were up and are likely to be up year over year. I think it is better for brick-and-mortar stores to finally get out of the Black Friday tradition of crowd-fueled chaos when the doors open. That is not a good shopper experience. I believe it is healthy for retail to move beyond it and into an era of creative, new promotional concepts.

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