News at Smith

Holiday Retail: Black Friday Dilution Intensifies

Nov 17, 2015
World Class Faculty & Research


SMITH BRAIN TRUST  Black Friday in 2015 is increasingly symbolic. “While the day after Thanksgiving still holds special significance in the U.S. retailing industry, retailers are increasingly drawing shoppers to other options in terms of time and venue for deep discounts,” says Jie Zhang, professor of marketing and the Harvey Sanders Fellow of Retail Management at the University of Maryland’s Robert H. Smith School of Business. "Instead of getting up early and ‘fighting the crowd’ in brick-and-mortar stores on Black Friday, shoppers might be better off by searching online and via mobile apps," she says.

To what extent will they? Ad Week projects that 92 percent of millennials  about 80,000 of whom spend $600 billion annually  will shop during Black Friday and/or Cyber Monday. Of those, 67 percent will shop online for either or both days; 44 percent will browse in stores before buying online; and 61 percent will be in stores for Black Friday.

For all shoppers, “more doorbuster deals are going online, as many retailers are offering Black Friday-like deals in their online stores earlier," ahead of Black Friday, Zhang says. Wal-Mart, for example, will offer most of its deals online starting early on Thanksgiving Day -– before opening its store doors at 6 p.m.

Aside from the shifting logistics and time frames, robust activity is anticipated. The National Retail Federation has projected November-December retail sales to increase by 3.7 percent to $630.5 billion. This includes 8 percent and $105 billion for online sales. Overall, the retail sales increase would top the average 2.5-percent increase over the past 10 years.

Retailers will drive that increase as they "broaden the touch points where consumers can find their deals,” Zhang says. “Look for more flash sales online and via mobile apps throughout the (holiday) season."

eMarketer predicts U.S. retail mobile commerce sales to climb by 32 percent in full-year 2015 — more than double the 14 percent increase forecast for all online retail sales. "Expediting this is bigger mobile device screens, more shopping apps available, combined with users increasingly comfortable in making purchases with their mobile devices," Zhang says.

Zhang further notes to watch for pop-up stores and expansive click-and-collect options (i.e., ordering online and picking up in store), plus free shipping without the minimum purchase requirement. The blog DC Velocity reports more than 25 percent of all U.S. smart phone users will use their devices to purchase holiday 2015 merchandise, with more than 70 percent of U.S. consumers expecting a seamless, omnichannel shopping experience.

Ultimately, the 2015 holiday season means “great discounts and excitement for shoppers,” Zhang says.



About the University of Maryland's Robert H. Smith School of Business

The Robert H. Smith School of Business is an internationally recognized leader in management education and research. One of 12 colleges and schools at the University of Maryland, College Park, the Smith School offers undergraduate, full-time and part-time MBA, executive MBA, online MBA, specialty master's, PhD and executive education programs, as well as outreach services to the corporate community. The school offers its degree, custom and certification programs in learning locations in North America and Asia.

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