Walmart Black Friday Deals

November 25, 2009 by  

By Andria Cheng

In Manhattan’s trendy Soho district, Gap Inc.’s (GPS) Old Navy chain has a prominent window sign telling shoppers it’s open for business on Thanksgiving Day. Across the street, the British retailer Topshop promises early birds a free English breakfast Friday morning.

In fact, while retailers like Sears Holdings Corp. (SHLD) have been touting their holiday-season offerings since as early as summertime, and industry behemoth Wal-Mart Stores Inc. (WMT) unfurled a Black Friday-style promotion a week early, the jostling will come to a climax Friday with the official kickoff of the industry’s most critical period. It’s called Black Friday because it’s the date on which retailers are traditionally expected to become profitable for the year.

Against the backdrop of a still-struggling U.S. economy marked by a 26-year-high jobless rate, retailers from Target Corp. (TGT) to Best Buy Co. (BBY) are opening their doors earlier than ever or making sure their highest-profile specials, from the $3 slow cooker at Target to the $197 Hewlett-Packard (HPQ) laptop at Best Buy, are enticing and competitive enough to drive traffic to their stores and set an upbeat tone for the season. Wal-Mart has emphasized in its ads that it will match prices in any local competitor’s print ad.

   Plan Of Attack

“You have to make your plan” for Black Friday weekend, said Barclays Capital analyst Robert Drbul in an interview, adding this weekend can be expected to generate 10% of total holiday season sales. “It’s hard to play catch-up. A lot of what you are seeing (in terms of store promotions) is surgical and tactical. It’s well-planned.”

While one day doesn’t a season make, Black Friday, as has been the case for several years, is again expected to be the No. 1 shopping day by both foot traffic and sales, generating 6% of the season’s turnover, according to the store- and mall-traffic tracker ShopperTrak. And members of about 26% of all U.S. households plan to shop on Black Friday, up from 24% in 2007, according to a survey by the International Council of Shopping Centers and Goldman Sachs.

“It’s my single biggest day of the year,” said Jim Fielding, president of Disney Stores Worldwide (DIS), in an interview, adding that Disney is opening more of its stores at midnight and has done more advanced media and publicity work this year to promote the opening. “This year it’s a more proactive campaign. All retailers are looking at maximizing the traffic.”

According to the National Retail Federation, a trade organization, as many as 134 million people, 4.7% more than last year, will shop this Friday, Saturday or Sunday.

Making the weekend’s sales even more crucial is survey results indicating shoppers plan to make their holiday purchases earlier than ever – a factor that has yet to reveal itself in November.

The International Council of Shopping Centers on Tuesday, in fact, cut its November sales forecast to 4% to 6% growth from a previous sales-growth projection of as much as 8%, according to the council’s chief economist, Michael Niemira.

So far, while retailers face hospitable year-over-year comparisons against their worst holiday season on record, the season’s ultimate results remain an open question. Forecasters are not even agreed on the direction of change from last year.

    Entering The Fray

All the focus on Black Friday appears to have lessened the importance of so-called Cyber Monday, the Monday after Thanksgiving that’s viewed as marking the start of the online holiday shopping season. E-tail giant Inc. (AMZN), for instance, launched a “Black Friday Deals Week,” indicating how much time is left before a sale is closed and the percentage of inventory sold, seeking to give shoppers a sense of urgency. Retailers have increasingly put stock in the notion of private sales, sneak previews, and limited-time and limited-quantity sales to connect with shoppers and loosen their purse strings.

“Retailers have started to use the term Black Friday not just as one day on the calendar, but as an adjective,” said Fiona Dias, executive vice president of strategy and marketing for GSI Commerce, which helps run Web sites and manage other Internet functions for about 200 retailers from Toys “R” Us Inc. to Polo Ralph Lauren Corp. (RL).

“Web (retailers) have woken up,” she said. “What has realized is that if they wait till Monday, consumers will be broke…For online retailers to wait until Cyber Monday, they are going to be out of the game.”

A case in point: According to online-payment site PayPal Inc., a division of eBay (EBAY), its first major spike in online-payment volume occurred Nov. 16.

The fervor over Black Friday has by now swept a swath of unexpected retail categories, including PetSmart Inc. (PETM), Home Depot Inc. (HD) and Lowe’s Cos. (LOW), that typically don’t rely heavily on holiday-season sales, analysts said. Home Depot’s Web site, for instance, features a countdown to Black Friday deals.

Those companies have “realized this brings out a lot of people,” Michael Lasser, a Barclays Capital analyst, told MarketWatch. “They realize: Why not participate in the event and have your message tailored to the season when the shoppers are out? It’ll help sales.”

   Demise Of The 'Doorbuster'

Crowd control is also expected to be a major focus this Black Friday – with the death of a Wal-Mart worker, trampled by a bargain-seeking mob at a Long Island store last year, fresh in the industry’s collective mind. With its connotation of chaos, the very term “doorbuster” appears to have been muted in 2009.

Wal-Mart will open a majority of its more than 3,500 U.S. namesake stores – recently rebranded as Walmart – on Thanksgiving Day and keep them open all the way through the beginning of the early-bird specials at 5 a.m. It also has indicated areas of the stores where shoppers can line up for hot deals. Each store also has its own specific plan to handle crowd flow, spokeswoman Daphne Moore said.

Rival Target for the first time also will offer store maps indicating popular sale items for any shoppers waiting in line.

Consumer electronics, from flat-panel televisions to so-called smartphones, and toys such as Zhu Zhu Pet fake hamsters will be big Black Friday attractions, joined by appliances, small and large.

Coats and other outerwear will be among the key promotions for apparel and department-store operators, analysts said. Retailers such as Gap (GPS), for instance, will cut 50% off outerwear prices and offer free Rock Band video-game guitars to the first customers in line at its Old Navy chain.

Discount and department stores are expected to be the biggest attractions, with about two-thirds of shoppers planning to head to those big boxes, according to the NRF survey. Four in 10 plan to buy gifts at electronics stores.

   Drawing First Dollars

While overall discount levels throughout this holiday season are expected to abate from last year as retailers across the board have controlled inventory to reduce the need for profit-eroding discounts, Black Friday specials are a different story, with retailers planning to be more competitive than ever. A majority of the shoppers who told the NRF that they’re planning to hit the stores this weekend also said they’d wait to see precisely what retailers were offering.

“The deals this year are a little more competitive,” said Michael Brim, founder of, which posts and tracks retailers’ Black Friday advertisements. “Retailers are trying to fight for the initial dollar.”

-By Andria Cheng, 415-439-6400;

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