Canadian shoppers craving a deal increasingly turn to Black Friday — a sales bonanza imported from the U.S., where retailers have long slashed prices the day after their Thanksgiving holiday — seemingly at the expense of another sales spree, Boxing Day.
Industry watchers say consumers plan to spend before Christmas and check gifts off their holiday lists, and the change offers retailers a slight edge.
“[Black Friday] is fulfilling an unmet need,” said Michael Leblanc, a senior retail adviser with the Retail Council of Canada, an advocacy group. It gives consumers the chance to secure deals on presents rather than shop after the gift-giving season is over.
Forty-three per cent of respondents to the group’s second annual holiday shopping survey planned to purchase items on Black Friday — up from 40 per cent the previous year. Only 34 per cent of respondents intended to shop on Boxing Day.
A survey by Deloitte Canada showed a similar disenchantment with the Dec. 26 sales day. Only one out of three respondents wanted to shop during the stretched-out, week-long event. The same number said the earlier Black Friday and Cyber Monday sales changed their habits for Boxing Day.
Spending figures from previous years suggest this shifting consumer sentiment is ongoing.
Boxing Day ‘significantly’ less popular
Canadians made six per cent more debit transactions on last year’s Black Friday than in 2017, according to data from payment processor Moneris. Black Friday also earned the title of biggest shopping day of the year for transaction volume.
Meanwhile, Boxing Day growth slowed in 2018, and the Friday and Saturday before Christmas surpassed it in transactions and dollars spent, the company said.
The shopping day “has dropped significantly in popularity with consumers,” Moneris said.
Interac Corp. recorded jumps in debit transactions on Black Friday of more than four per cent for the past three years, while the total amount spent rose steadily as well. Its yearly growth in both categories for Boxing Day was higher, but the overall number of Interac debit transactions and the total volume of spending are about half of those seen on Black Friday.
Mad scramble in U.S.
In the U.S., retailers are expecting a mad scramble because Thanksgiving, which falls on the fourth Thursday in November, is six days later than it was last year. That means customers will have fewer days to shop before Christmas and retailers will have less time to woo them.
At Macy’s Herald Square in the Manhattan area of New York City, there was a steady stream of shoppers by 7 a.m. ET in search of deals from 40 per cent to 60 per cent on everything from boots to sheets. The crowds grew bigger an hour later.
Theodora Hatcher from Manhattan arrived with her son at around 6 a.m. She said she started holiday shopping two weeks ago, lured by online deals of up to 60 per cent at Walmart.com, Amazon and Old Navy.
As for the shortened calendar, she prefers it.
“It adds pressure,” she said.
‘I love the thrill of it’
Seturah Winkler, 43, who was shopping in the women’s shoe department with her friend, were among the throngs of shoppers at Macy’s 5 p.m. opening on Thanksgiving.
Winkler had already spent $1,000 Thursday on coats, comforters and towels, and was back for more.
“We took a break, and we are back at it again, “said Winkler, of Richmond, Va., who has made the pilgrimage to Macy’s on Thanksgiving and Black Friday an annual tradition for several years. “I love the thrill of it. It’s exciting.”
Adobe Analytics predicts a loss of $1 billion US in online revenue from a shortened season. Still, it expects online sales will reach $143.7 billion, up 14.1 per cent from last year’s holiday season.
Last year’s sales hurt by White House
The National Retail Federation, the U.S.’s largest retail trade group, baked the shorter season into its forecast, but it says the real drivers will be the job market. It forecasts that holiday sales will rise between 3.8 per cent and 4.2 per cent, an increase from the disappointing 2.1 per cent growth seen in the November and December 2018 period that came well short of the group’s prediction.
Last year’s holiday sales were hurt by turmoil over White House trade policy with China and a delay in data collection by nearly a month because of a government shutdown. This year’s holiday forecast is above the average holiday sales growth of 3.7 per cent over the previous five years.
NRF expects online and other non-store sales, which are included in the total, to increase between 11 per cent and 14 per cent, for the holiday period.
Black Friday is expected to once again be the largest shopping day of the season in the U.S., followed by the last Saturday before Christmas, according to MasterCard SpendingPulse, which tracks spending across all types of payments including cash and cheque. Thanksgiving Day isn’t even on the top 10 holiday shopping days, according to MasterCard.
The 2019 holiday season will be a good measure of the U.S. economy’s health. Many retail CEOs describe their customers as financially healthy, citing moderate wage growth and an unemployment rate hovering near a 50-year low.
“The overall picture is positive,” said Craig Johnson, president of Customer Growth Partners, a retail consultancy. “People are spending out of positive cash flow as opposed to borrowing.”
The U.S. sales phenomenon has spread to retailers across the world in recent years with such force that it’s prompting a backlash from some activists, politicians and even consumers.
Workers at Amazon in Germany went on strike for better pay on one of the busiest days of the year. Near Paris, climate demonstrators blocked one of the company’s warehouses on Thursday to protest over-production they say is killing the planet. Some French lawmakers want to ban Black Friday altogether.
Consumer rights groups in Britain and some other countries say it’s not always clear how real or big the discounts are. Other critics say it hurts small businesses.