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What Are The Retail Lessons From Black Friday 2020?

For the first time in years, retailers won Black Friday.

Yes, there were planned promotions, but fewer than in years past. And Many retailers shut on Thanksgiving, leaving their online channels to keeps revenue coming in for those who chose to shop on the holiday.

Visits to physical stores on Thanksgiving Day decreased by 94.9 percent when compared with traffic data in 2019, according Sensormatic Solutions. Sensormatic’s data also indicated that shopper visits saw a 52.1 percent decline in traffic on Black Friday, compared with 2019. Data also indicated that the peak time for shopping stayed the same, with the busiest influx of foot traffic at 2:00 p.m.

“Due to Covid-19 and social distancing requirements, shoppers were more purposeful in their in-person Black Friday shopping, causing significantly less crowds than we’ve seen in the past,” said Brian Field, senior director of global retail consulting, Sensormatic Solutions. “This was compounded by retailers not offering as many in-store doorbusters and the increasing adoption of e-commerce.”

Feld expects that Super Saturday, Dec. 19 this year and dubbed that because it’s the last Saturday before Christmas, will see some last-minute in-store traffic as consumers, under the gun to wrap up their holiday shopping. Sensormatic expects the 10 busiest days in 2020 to account for 34.2 percent of holiday traffic this year, compared with 46.5 percent in 2019.

Things didn’t change much over the weekend, mostly because retailers had already brought their holiday promotions—many were referred to as “early Black Friday” specials—forward into October. It’s a move that stretches out the holiday season and makes Black Friday less important than in years past. And with the growing shift to online shopping, an acceleration of a trend brought on by Covid, consumers can channel surf sites to hunt for the best deals available.

“People started early and we were expecting a surge in online sales this year. That had the Black Friday holiday weekend stretch out for quite awhile,” Michael Zuccaro, apparel credit analyst at Moody’s Investors Service, said. As for the holiday weekend, the “longest lines were at customer service. Many shoppers were buying online and picking up in-store. What we don’t know is how many who stopped by had also ventured inside the store to do more shopping,” he said.

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While Zuccaro observed that store shelves seem well-stocked with apparel offerings, he said it’ll be interesting to see how discounting stacks up in the weeks ahead. “Time will tell. If the percentages go up, and there’s still stuff on the shelves, that means that there’s a problem,” he said.

And while the credit analyst noted that there doesn’t seem to be anything that was overly promotional, he did observe that there seem to be fewer promotions than usual for Black Friday. Many brands and retailers simply upped the discounting a notch as the weekend progressed, offering consumers an extra 10 percent off .

That kind of promotional cadence could be the best lesson for retailers, even if consumers hoping for deeper discounts end up grumbling that they lost when inventory sold out.

“Black Friday was a bust for the consumer, but not for retailers. This was the least promotional holiday that we’ve seen for a long time,” Simeon Siegel, retail analyst at BMO Capital Markets, said.

He said that retailers are finally learning that they can sell more by having less, see better margins than ever before, and consequently higher profits.

Another learning for retailers this year is that “we found it is really easy to retrain the consumer. The consumer wants to purchase, but if there are bloated inventory levels, they are the ones in control and we see that with the amount of promotions [that are offered],” Siegel said.

According to the retail analyst, “We know that if retailers are willing to give up 40 percent of their units, there will be 60 percent of people willing to spend more…. It comes down to supply and demand.”

That also means the long-held belief in retail that the consumer holds the power is no longer correct and that Holiday 2020 is proof. “Retailers can take the power away from the consumer. Their power lies in inventory and access,” the retail analyst concluded.