Black Friday Spending Soars Due to Early Store Openings, Mobile Device Shopping
- Nov 26, 2012
The Outlets at Castle Rock in Colorado has been opening its doors at 9 p.m. on Thanksgiving Night for the past four years for its Moonlight Madness event. This year, several major retailers across the United States also started the holiday shopping season several hours ahead of the traditional Black Friday frenzy.
The early openings did attract plenty of eager shoppers on Thursday night. The National Retail Foundation reported Sunday that more than 35 million shoppers visited retail stores and web sites Thursday, up from 29 million a year ago. The survey, conducted by BIGinsight, also found that 89 million people shopped in stores and online on Black Friday, compared to 86 million in 2011.
“Black Friday continues to be an important day in retail,” said Bill Martin, founder of ShopperTrak. “This year, though, more retailers than last year began their ‘doorbuster’ deals on Thursday, Thanksgiving itself. So while foot traffic did increase on Friday, those Thursday deals attracted some of the spending usually meant for Friday.”
ShopperTrak estimated that retail foot traffic on Black Friday rose 3.5 percent from last year to more than 307.67 million store visits. But it said retail sales dropped 1.8 percent with shoppers spending about $11.2 billion on Black Friday.
Some of that spending likely went to online sites. The IBM Digital Analytics Benchmark stated that online sales on Thanksgiving grew 17.4 percent this year and by 20.7 percent on Black Friday.
Much of that online traffic is now driven by mobile devices. The number of consumers using mobile devices to shop at retailers’ sites was up 24 percent from 14.3 percent in 2011 with sales exceeding 16 percent compared to 9.8 percent a year ago, according to IBM. Many shoppers were surfing their smart phones or tablets while they were in retail stores. IBM said 58 percent of consumers used smart phones while 41 percent tapped into their tablets while shopping for Black Friday deals.
“They’re using their smart phones and iPhones as they’re checking the holiday sales and going from one store to another,” said Faith Hope Consolo, chairman of The Retail Group at Prudential Douglas Elliman Real Estate in Manhattan.
Consolo said the bricks and mortar retailers have upped their apps to connect with consumers and get them into the stores.
“The apps drive people into the stores. That’s your new traffic generator,” she told Commercial Property Executive.
Nearly 30 percent of multichannel retailers said they would promote their Black Friday deals with mobile alerts, up from about 19 percent last year, according to BIGinsight. Retailers are also using social media to lure shoppers, with 80.6 percent of those retailers surveyed saying they would use Facebook to alert shoppers to discounts.
Still there are always those shoppers who want to hit the mall or Main Street in person.
“You have the consumer who does their research online, but still goes physically into the store,” Consolo said.
Consolo said that she had been talking to associates around the U.S. and they were reporting steady foot traffic for the first two official holiday shopping sales days.
“People were out yesterday. They were out early this morning,” she said Friday afternoon.
She expects that shoppers will spend more this holiday season. The NRF is forecasting holiday sales to increase by 4.1 percent to $586.1 billion. Consolo says it could even hit 5 percent.
Early tracking may support that prediction. The NRF said Sunday that a record 247 million shoppers visited stores and web sites over the Black Friday weekend, up from 226 million last year. The average holiday shopper spent $423, up from $398 last year with total spending estimated at $59.1 billion.
Consolo and other retail experts think the recent hurricane that hit the Northeast will have minimal effects on the overall holiday shopping season. Although the Northeast should see increases in sales of home goods and cars as people hit hard by Sandy seek to replace what they lost in the late October hurricane.
Karen Bellantoni, executive vice president at Robert K. Futterman & Associates in New York, a real estate firm specializing in retail leasing, investment and consulting services, said the lower Manhattan stores she handles had closed for several days but had all reopened “with very little loss of inventory.”
She said there was pent-up shopping demand once the stores in places like Tribeca and SoHo reopened.
“After the storm, people were just swarming back into the stores,” she said.
Bellantoni said urban markets across the U.S. are expected to have strong holiday sales. Luxury brands are expected to do very well, she said. Stores selling accessories, particularly shoes and handbags, are particularly hot right now, Bellantoni said. She pointed to Michael Kors as one example.
“Michael Kors is on fire with all accessories,” she said. “The brand is spot on.”
Another accessories retailer doing well is Carlo Pazolini, an Italian-based company that has 11 stores in the U.S., including at 543 Broadway in SoHo, The Mall at Short Hills in New Jersey and Galleria Dallas.
“They are open a year in New York,” Bellantoni said of the men’s and women’s shoe store. “Business will be up from last year.”
Bellantoni said watch for outlets to do particularly well this holiday.
“Outlets are very successful for retailers. There are very, very few stores (at outlets) that are not successful,” she told CPE, adding, “You have to have the names.”
They have more than 100 brand-name retailers at Outlets at Castle Rock, a 480,000-square-foot center located between Denver and Colorado Springs, Colo., including 10 new stores such as Michael Kors, Aldo Shoes and White House Black Market. The outlet center, which is celebrating its 20th anniversary, “has had a ton of new construction, really updating our look,” said Lisa Burger, senior leasing executive.
“We have a lot of first-to-market brands and powerful brands that draw the consumer,” said Lisa Zetah, marketing director, adding that the center has a “really strong pipeline” for growth in 2013 and 2014.
Crowds packed Outlets at Castle Rock on Thanksgiving Night for the annual Moonlight Madness promotion, which ran from 9 p.m. Thursday to 9 p.m. Friday. Besides the stores’ sales, the center offers more than $100,000 in giveaways.
“Our Thanksgiving shopping tradition attracts people from across the state and beyond,” Zetah said of the outlet center, which is one of the top five tourist destinations in the region.
With temperatures in the 50s, the open-air center was busy all weekend and the new stores reported strong traffic and sales, officials said.
For those who didn’t shop over the Thanksgiving weekend, today is Cyber Monday, so expect online retailers to be offering more deals to the 129.1 million consumers who say they expect to shop online today.