Black Friday draws early shoppers, but real frenzy is online

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CHICAGO/NEW YORK – Turnout at U.S. retailers was relatively subdued on Black Friday, with many shoppers flocking to stores to eye items in person and enjoy the festive atmosphere while waiting to do their actual bargain hunting online.

There were few signs of the over-the-top frenzy that had been a hallmark of the start to the U.S. shopping season in years past, and some stores appeared to be getting creative with gimmicks beyond heavy discounts to lure shoppers through their doors.

The day after Thanksgiving is traditionally when retailers offer “doorbuster” deals attracting bargain hunters. Many department and big-box stores have said they will compete fiercely on price this quarter while keeping inventory lean.

Tricia Welch, 36, a customer service executive at a bank, stood in line for about an hour before getting into a Target Corp. store in Manhattan.

“There are definitely more discounts available through the year now than say four to five years ago … we only buy electronics or appliances on Black Friday.”

Miguel Flores, 43, an overnight security guard, visited the store after his shift ended.

“I mostly shop online but decided to drop in because I haven’t been to a store in a long time,” Flores said. “I bought some video games for my nephew a few days ago. The deals were pretty good then, too. In fact I was just looking at some of them today and the deals are similar.”

Tenesha Robertson, 43, a loader at UPS, exited Macy’s in Jersey City’s Newport Centre Mall with her mother, daughter and several large bags in tow. They were headed to drop shopping items off at Robertson’s car before buying more at the mall.

“We go to Macy’s every year,” she said. The discounts are about the same, but we like to come just to be here for the family time.”

But online demand may help make up for lackluster store traffic, and even the subdued in-store activity this year marked an improvement over recent years.

Macy’s Inc. Chief Executive Jeff Gennette told CNBC on Friday that the retailer was better off this year than last, had robust online demand and was in a good place for holiday promotions, sending the retailer’s shares up more than 4 percent in early trading.

JC Penney Co. climbed 1.8 percent, while Target Corp. and Wal-Mart Stores Inc. edged higher.

The period between the U.S. Thanksgiving holiday and Christmas can make or a break a retailer, accounting for as much as 40 percent of total revenue for the year.

“The turnout this morning has been relatively slow but it is still the best we have seen in three years. We expect it to pick up as the day progresses,” said Burt Flickinger, managing director, Strategic Resources Group. He cited improving consumer confidence, a strong job market, and healthy housing prices.

More people picked up deals online and the traditional rush was split by stores opening the night before. Godiva gave out free chocolates, Sephora offered face masks and perfumes and dancers entertained Bergdorf Goodman shoppers, according to the New York Post.

The deepest Black Friday discounts included more than $200 off some BestBuy TVs, all bras across Victoria’s Secret Pink stores sold for $25, half-price video games at Target, and $50 off PlayStation 4 Pro gaming consoles at Walmart.

The challenge for retailers will be to convert early spending into a desire to spend throughout the season and to go beyond deep discounts, NPD Group Chief Industry Analyst Marshal Cohen said in a note.

There were some signs, however, on Thursday night of the shopping frenzy that Black Friday is traditionally known for.

The Riverchase Galleria in Hoover, Alabama, outside Birmingham, said police had to be called to break up a fight at about 11:30 p.m. on Thursday between two women who might have been trying to get the same sale item in a store.

Mike White, general manager of the mall, said there were reports of two other scuffles in the mall, Alabama’s biggest, and the mall decided to shut about 15 minutes early.

“There were just a lot of people shopping last night. We were full all night long.”

NOT WHAT IT USED TO BE

Enticing shoppers with Black Friday deals is especially important for brick-and-mortar retailers given the continued switch to online shopping, led by Amazon.com Inc, which has forced chains such as Toys R Us, apparel retailers True Religion, The Limited, Rue 21 and off-price retailer Payless Shoe Source to file for bankruptcy this year.

Amazon began touting its sales for Cyber Monday, one of the biggest days for online shopping, on Friday and said shoppers using its digital assistant Alexa could score deals as early as Sunday.

Wal-Mart, Target, Macy’s, JC Penney and other retailers opened their stores on Thursday evening and most have been offering extended deals online starting as early as October. Some started offering in-store deals earlier this week.

Garden State Plaza in Paramus, New Jersey, was crowded but not chaotic. Shoppers came for deals with nothing specific in mind. Those who came enjoyed the experience of trying on clothes rather than shopping online.

“It looks a little slower this year,” Build-A-Bear employee Marissa Trujillo said.

“Black Friday isn’t what it used to be because stores are extending their sales into the weekend and you can shop online,” said Unmesh Patel, 30, a project manager. “I also come for the rush even though it lessens every year.”

A Macy’s employee at the mall said it was less busy on Friday because the store had been open, and packed, on Thursday.

U.S. shoppers had spent more than $1.52 billion online by Thanksgiving evening, a 16.8 percent year-over-year increase in online spending, by 5 p.m. (2200 GMT) on Thanksgiving, according to Adobe Analytics, which tracked 80 percent of online transactions at the top 100 U.S. retailers.

“They’re all online,” said Sarah Jones, 42, an employee at Roosevelt Field Mall on Long Island. “Right now they’re at toy stores and electronic stores. They’ll trickle in a little later and we’ll be waiting. I’ve worked in retail my whole life, trust me.”