3Qs: Internet, small businesses giving Black Friday a run for its money

November 22, 2012 by Jordana Torres in Technology / Business
Credit: Dreamstime

To fam­i­lies across America, Thanks­giving rep­re­sents a day filled with togeth­er­ness and turkey. To Amer­ican retailers, the hol­iday kicks off a shop­ping bonanza with Black Friday, Small Busi­ness Sat­urday and Cyber Monday. These days have proven to be prof­itable for retailers in the past, though their growing prac­tice of opening shop as early as Thanks­giving evening has this year led to con­sumer and worker out­rage. Northeastern University news office asked Bruce Clark, asso­ciate pro­fessor of mar­keting in the D'Amore-McKim School of Busi­ness, to talk about the poten­tial pros and cons of each of these shop­ping days.

Retailers such as Target, Toys R Us and Walmart are opening their doors earlier this year than ever before—some as soon as 8 p.m. on Thanksgiving Day. What impact will early retail openings have on retail sales figures?

Overall, I'd fore­cast that the early open­ings wouldn't have much effect. On the pos­i­tive side, there is a lot of buzz about the big move, and that will make con­sumers more aware of in gen­eral. Last year, some claimed that opening at mid­night reached a dif­ferent seg­ment of shop­pers who would rather stay up late than get up early; the early-​​evening open­ings should only exploit that demo­graphic further.

The chal­lenges here lie in con­sumer bud­gets and atti­tudes. To the extent con­sumers are econ­o­mizing, opening early may simply shift 2 a.m. money to 10 p.m. money. Addi­tion­ally, I would worry about the groundswell of dis­con­tent from employees and some con­sumers about the sym­bolism of opening on Thanks­giving. It seems to be leaving a bad taste in a lot of people's mouths. Finally, the online shop­ping jug­ger­naut shows no sign of slowing down, so it's pos­sible that foot traffic may be down regard­less of timing or retail promotions.

Small Business Saturday was created in 2010 to put more money into local economies and support local jobs and tax revenues. Has this proven successful in the two years since the term has been coined?

I think it has been a ter­rific suc­cess for Amer­ican Express, who con­ceived the cam­paign and has seen it take off on social media. The cam­paign has also reminded con­sumers about the small busi­nesses in their com­mu­nity; there is a lot of local press cov­erage this year about Small Busi­ness Sat­urday activ­i­ties in par­tic­ular com­mu­ni­ties. Sup­porting small busi­nesses is a "feel good" activity for everyone. This has to be a plus for local businesses.

Actual sales fig­ures, how­ever, are much harder to come by. I don't think anyone knows how big the effect is nation­ally. I sus­pect it works best for small busi­nesses that are already well-​​run in the first place, and in com­mu­ni­ties where small busi­nesses band together to create events that draw shop­pers into areas where clus­ters of small busi­nesses make shop­ping convenient.

Cyber Monday has become an increasingly popular option throughout the years for those who prefer online shopping. What threat does this convenience pose to traditional brick and mortar retailers who depend on in-store purchases?

Online hol­iday sales have been growing much faster than in-​​store sales, espe­cially in cat­e­gories such as con­sumer elec­tronics. I expect that trend to con­tinue this season. The increasing use of smart­phones to research and, in some cases, buy prod­ucts online while con­sumers are in-​​store rep­re­sents a big worry for retailers as they lose con­trol of both mes­saging and sales. This is leading retailers to reduce their inven­tory and floor space of pop­ular online items. Tra­di­tional retailers can try to fight back based on product and price, but I'd say the best tactic is to con­cen­trate on doing the one thing online can't do: create an engaging retail store expe­ri­ence. If a store is fun and exciting to visit, sales will follow.

Provided by Northeastern University

"3Qs: Internet, small businesses giving Black Friday a run for its money" November 22, 2012 https://phys.org/news/2012-11-3qs-internet-small-businesses-black.html