The mall’s owner, CBL, highlighted on its website the discounts offered by stores like H&M and children’s clothing retailer Carter’s. Other retailers followed a similar strategy in the days leading up to Black Friday. J. Crew promoted 50 percent off purchases Monday. Gap’s website rolled a large black banner at the top of the page that read “HPY BLK FRI” and highlighted 50 percent off deals with an additional 10 percent off.
However, there are risks for retailers as they rely more on deals. The practice is eroding the profit margins that have given them a boost during the pandemic, when many Americans were spending heavily on all kinds of goods and retailers didn’t feel the need to lure them with too many deals. There is also concern that buyers will become so used to the sale that they will only buy if they are promised a lower price.
“Consumers’ understanding that they can wait for discounts, coupled with retailers’ drive to move goods, likely means this Black Friday will be more important than Black Friday has been in a long time,” Simeon Siegel, Managing Director at BMO Capital Markets said. “Whether that’s good for brands, whether that’s good for the consumer — that’s another conversation.”
Retailers are also competing more with entertainment options such as concerts and restaurant dining than in recent years. Consumers are expected to spend a larger portion of their vacation spending on experiences this year than they did last year. The average amount middle-income Americans, who earn between $50,000 and $99,000 annually, spend on experiences is expected to increase 15 percent this year, according to a Deloitte survey released in October.
Of course, not every retailer attaches so much importance to Black Friday.
Outdoor gear retailer REI has been closed on this day since 2015. This year, the company decided to give its employees a permanent paid day off on Black Friday, encouraging them to spend time outdoors instead.
But that was the exception. Even as total sales for Black Friday were still being counted, many retailers were already trying to further lure shoppers by rolling out ads for more discounts on Monday.