Retail Revolution   /   December 3, 2019

How physical retailers are trying to stay relevant on Black Friday

This year’s Black Friday — as well as the weekend that followed — broke sales records, even as its position as the 24-to-72-hour in-store sales bonanza may be beginning to wane. There was one strategic win for brick-and-mortar retailers, however: Using their online and physical footprints to complement each other.

A new piece of Morgan Stanley research sent on Monday notes the decline of in-store traffic, and that online sales increased 17% year-over-year. “[T]he start of Black Friday promotions online the Monday before Thanksgiving likely pulled forward demand to digital,” the report said.

This shift falls in line with many traditional stores’ updated omnichannel strategies. What retailers seem to have focused on this year is providing a variety of holiday programs and deals to better compete with online competitors like Amazon. Much of this had to do with a larger re-strategizing of physical assets.

“Retailers are leaning into their traditional strengths of brick-and-mortar footprints,” said Gartner research director Bill Duffy, but “utilizing that in different ways.” Big players like Target and Walmart, for example, offered online sales as well as deals in-store. Not only that, but they encouraged customers to pick up their gifts in a variety of ways. Many brands offered deals the Monday before Thanksgiving as well as beyond Friday. That these stores are offering more ways for customers to buy their products online, it’s creating counter-programming to the “Black Friday midnight stampede,” said Duffy.

Even with this shift, the sales event was still quite big. Black Friday sales hit $7.4 billion, and Small Business Saturday sales were at $3.6 billion, according to Adobe. While both were records, Black Friday sales didn’t quite get to the $7.5 billion forecast by Adobe, indicating a slight slow-down in expected growth. Indeed, physical shopping in brick-and-mortar stores saw a 6.2% drop this year compared to the year before, reported data from ShopperTrak. Meanwhile, what hasn’t slowed down is retailers trying to best use the infrastructure they have in updated ways. Buy online and pickup in store sales, for example, saw a 46.6% increase year-over-year.

Put together, the data shows retailers reinventing their physical spaces to be something more than an arena for a 24-hours sales rumble. The numbers also hint at something else: Black Friday as a standalone holiday’s power may be losing a bit of its luster. With more options and longer sales windows, consumers aren’t feeling the pressure they did only a few years ago. “It’s no longer just the two days of Black Friday and Cyber Monday,” said Adam Pressman, managing director in AlixPartners’ retail practice.

While large retailers — especially Target and Walmart — focused on offering myriad ways and timelines for customers to participate in its Holiday sales kickoff, smaller brands saw big pickup too. Shopify reported that more than 20 million customers participated in the sales this past weekend, and its merchants saw more than $1.5 billion in sales.

Online sales growing and store traffic losing some ground doesn’t mean that Black Friday is going away. Instead, traditional brands are figuring out ways to better get customers’ attention. “Retailers are acknowledging that customers can buy things in a wide variety of ways,” said Duffy.

Instead of using the store as the sole place for the Black Friday sale, leading to long lines and disgruntled employees and shoppers, the sales are being extended beyond the specific days and the stores are taking on new meaning; Black Friday is still here, albeit less impactful.

The physical spaces, meanwhile, aren’t dying but being reimagined for new promotions. “When executed correctly,” said Pressman, “the stores are still very much an opportunity to engage and interact.”

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