Explainer: What is Black Friday? And will shoppers find bargains this year?

Retailers are gearing up for what they hope will be another record-breaking global shopping spree on Black Friday, the fourth Friday in November, which this year is November 24.

Known for the crowds that line up at major stores to take advantage of killer discounts in the early hours after American Thanksgiving, Black Friday typically marks the unofficial start of the Christmas shopping season.

Retailers in the US, Europe and elsewhere will try to cash in on the unrest. Here’s what to expect from Black Friday 2023.

Why is it called Black Friday?

Beginning in the 1960s and early 1970s, Philadelphia police and bus drivers used the term “Black Friday” to refer to the chaos created by the influx of people into the city before Thanksgiving weekend. . Visitors scoured Philadelphia stores on Friday with their Christmas lists looking for gifts. Shoplifting and parking violations followed.

Department stores have renamed the term “Big Friday” to put a more positive spin on it. But the name didn’t stick, and since the 1980s, retailers have begun describing Black Friday as the day when their retail books are supposedly “in the black,” or operating at a profit, as customers begin to make purchases. holiday shopping, according to Marcus Collins, a marketing professor at the University of Michigan’s Ross School of Business.

“What we know is Black Friday, because it’s so ceremonial we have more people participating,” Collins said.

What are retailers’ plans for this year?

Retailers like Best Buy, Macy’s, H&M, and pure-play e-commerce retailers like Shein and Temu are already releasing early Black Friday “deals” of up to 30% off select limited merchandise online and in stores.

These early promotions could help them gauge consumer demand and avoid product shortages, which could be a big problem this year. Water levels in a key maritime artery, the Panama Canal, have fallen due to a severe drought, reducing the number of ships carrying goods through it.

Many retailers in the U.S. have intentionally muted their holiday hiring plans. Labor shortages also pose a challenge for retailers in Europe, meaning consumers may find fewer staff to help them.

Are Black Friday crowds likely this year?

Around 130.7 million people plan to shop on Black Friday this year, according to data from the National Retail Federation (NRF). Thanksgiving weekend, which encompasses Black Friday and Cyber ​​​​Monday – the Monday after Thanksgiving – is typically the busiest shopping period in the United States.

But Dana Telsey, CEO of Telsey Advisory Group, said Black Friday itself won’t be as important this year. With Christmas falling on a Monday, the “procrastination factor (is) even greater because shoppers may wait until Saturday or Sunday” before Christmas to receive gifts, she said this week.

During the holiday season, store traffic is expected to decline slightly this year, down 3.5% from last year, according to retail analytics firm Sensormatic Solutions.

Rainy weather, which impeded store traffic in some parts of the U.S. last year on Black Friday morning, is not expected this year, according to AccuWeather.

While most U.S. stores will close again on Thanksgiving this year, opening to shoppers at 5 a.m. or 6 a.m. on Friday, some retailers are advertising online discounts that begin at 12:01 a.m. on Thanksgiving Day.

Among them is Kohl’s, which is running what it calls a “Super Deal” for Thanksgiving and Black Friday on products like Beats Studio Buds noise-canceling wireless headphones for $89.99, a from the regular price of $149.99.

Retailers big and small are promoting online ordering and curbside pickup this year for the convenience of shoppers who want to avoid stores. Over the past decade, Americans’ online shopping on Black Friday has more than tripled, reaching $9.12 billion on the day last year, according to data from Adobe Analytics.

FILE PHOTO: People line up to enter the Shein Holiday pop-up store inside Times Squares Forever 21 in New York City, US, November 10, 2023.REUTERS/David ‘Dee’ Delgado/File Photo

Will shoppers find Black Friday deals this year?

Several major retailers, including Dollar General, Walmart and Macy’s, could be saddled with too much inventory for a second year in a row, according to a Reuters analysis. They will likely need to offer discounts to attract shoppers to their stores and websites.

Even before Black Friday, research firm Jane Hali & Associates said discounts at Kohl’s and Macy’s reached 60%, with foot traffic lower at those two retailers and at Nordstrom compared to last year.

Adobe said online discounts are expected to reach 35% on toys, 24% on sporting goods and 19% on furniture.

How much are buyers expected to spend?

U.S. online and in-store holiday sales are expected to increase between 3% and 4% during November and December, the slowest pace in five years, according to an NRF forecast.

Online spending during Black Friday is expected to increase 5.7% to about $9.6 billion, according to Adobe Analytics.

In the UK, online spending during Black Friday is expected to increase by 4.5% to £1.05 billion ($1.30 billion), with total sales during Cyber ​​Weekend expected to increase. reach £3.8 billion, according to an Adobe forecast.

What are retailers doing to attract holiday shoppers?

With student loan payments returning and housing costs and essentials squeezing family budgets, analysts believe retailers will have to rely on promotions and early offers to stay afloat this holiday season.

Consumers were looking to make the most of promotional events and complete their purchases in just 5.8 weeks this year, compared to a pre-pandemic window of 7.4 weeks, according to data from Deloitte.

What items are hot on Black Friday this year?

IPhones will be in fashion again, with the recent launch of the iPhone 15. Last year, buyers looking for Apple’s iPhone 14 Pro and iPhone 14 Pro Max came back empty-handed as the tech company faced production issues in China .

Electronics are expected to be the top choice this shopping season, with growth estimates of 6%, according to a report from Mastercard.

Best Buy kicked off its Black Friday deals in late October with deals like the Play Station 5 for $499.99 along with Marvel’s “Call of Duty: Modern Warfare III” or “Spider-Man 2,” although the retailer on Tuesday predicted a larger decline in annual comparable sales and pointed to “difficult to predict” consumer demand.

Skin and hair care products remain popular, with Ulta Beauty offering up to 40% off CoverGirl and Lancome mascaras, Bobbi Brown concealers, and select products from its own brand.

What are retailers saying about this year’s Black Friday?

Macy’s CEO Jeff Gennette said Thursday that the competitive landscape has changed for Black Friday deals before Black Friday. “We are in the middle of this along with our competitors, customers are taking advantage of this.”

Mattel President Steve Totzke told Reuters on Monday that he expects a strong Black Friday and preparation for the holidays, even as the toymaker warned of slowing demand from the toy industry last month.