Despite more time to shop, Black Friday weekend customers spend less

Rollice Roice Abuan of Allentown PA holds three minion dolls from the Despicable Me movie that she is buying at Toys R Us. She and several family members waited in line since 10 this morning in order to get the items they wanted.
Rollice Roice Abuan of Allentown PA holds three minion dolls from the Despicable Me movie that she is buying at Toys R Us. She and several family members waited in line since 10 this morning in order to get the items they wanted.(Barbara Haddock Taylor / Baltimore Sun)

Despite extra time to shop as more retailers opened for business on Thanksgiving Day, consumers spent less money this year during the first four days of the official start of the holiday shopping season, according to a survey released Sunday by the National Retail Federation.

The group found that shoppers spent an average of $407.02 in stores and online from Thursday through Sunday, down from $423.55 a year ago. In all, shoppers spent an estimated $57.4 billion during the four days, down $1.7 billion compared with last year.


Opening stores on Thanksgiving has been controversial, particularly among retail employees and holiday purists. But with nearly 45 million consumers shopping on Thursday, it's a practice that's likely here to stay, even if it might come at the expense of Black Friday, retail experts said.

"Shopping on Thanksgiving has evolved over the last decade into something more than just a fad," Matthew Shay, president and CEO of the National Retail Federation, said. "Thanksgiving has become an increasingly important and an official part of the holiday [shopping] weekend now."


All told, more than 141 million consumers shopped in stores or online from Thursday through Sunday, up 1 percent from a year ago, the federation estimated based on a survey of 4,464 consumers conducted in recent days. The lower level of spending during those days may be attributed to people shopping earlier to take advantage of promotions by retailers in October and early November, Shay said. With Thanksgiving coming late this year, retailers have fewer days to convince customers to open their wallets, so there has been a flurry of promotions.

But Shay added not all consumers are experiencing improvements in the economy and the benefits of soaring stock prices.

"For far too many Americans, things aren't great," Shay said.

Even so, the retail federation expects shopping overall this holiday season will increase by 3.9 percent over a year ago.

Part of that will be from sales today, Cyber Monday, when the retail group anticipates 131 million consumers to shop online, up by 2 million from last year.

Larry Chiagouris, a marketing professor at Pace University in New York, said he thinks the federation is too conservative in its retail sales projections.

"There is a lot of pent-up demand. At some point in time, there is a gush of shopping that takes place when people aren't comfortable with putting things off any longer," he said. And that point is likely now, he said.

Chiagouris said he doesn't expect consumers to spend, however, unless they are given special deals.

"We have now trained shoppers to expect discounts," he said.

Baltimore area retailers on Sunday reported a strong start to the holiday shopping season.

"The traffic has been pretty consistent with past years, which is fantastic," Tim Betz, manager at City Sports in Harbor East, said.

Betz attributed part of the increased traffic and sales to a promotion on popular brands, such as Nike and Adidas.


"We were expecting to see a hangover after Black Friday," he added, figuring weary shoppers would stay home on Saturday. That wasn't the case, Betz said, adding business on Saturday was almost as good as the day before.

Michal Makarovich, owner of Hampden Junque, said his shop that sells collectibles did well on Friday, but tripled its business the next day on Small Business Saturday — a day promoted to help small merchants compete with big chains.

"That was gangbusters," Makarovich said.

Consumers tend to shop the big retailers at the malls on Black Friday, he said, but bring their visiting friends and families to neighborhood shops on Saturday.

"There were people from Montreal, from Iran, from Italy and Bethesda," he said. "They were bringing in friends to show them Hampden and they were buying."

Rick Martinkus, owner of Pardiso in Hampden, said his 10-year old store has seen sales rise year-over-year each winter holiday season — even though it isn't open on Thanksgiving.

"We're old school. No holiday before its time," he said.

Though nearly a third of shoppers in the past four days shopped on Thanksgiving, Black Friday remained the biggest shopping day, according to the National Retail Federation. More than 92 million people shopped in stores or online that day, up from around 89 million a year ago, the group said.

But some retail experts say Thanksgiving ate into Friday's sales.

ShopperTrak, a Chicago-based provider of shopping analysis, reported Saturday the number of customers in brick-and-mortar in stores on Thanksgiving and Black Friday increased 2.8 percent this year compared to a year ago, while sales increased 2.3 percent to about $12.3 billion.

But just comparing Black Fridays, the picture is far different, according to ShopperTrak. This year, traffic on Friday was down 11.4 percent from a year ago, while sales also fell by 13.2 percent.

"It's clear that retailers were able to draw sales on Thursday, but it did come at the expense of Black Friday," said Bill Martin, founder of ShopperTrak.

Martin predicts shopping on Thanksgiving will continue to be a trend, at least for a few years until retailers determine whether sales that day are worth the added expense of keeping stores open.

ShopperTrak also gauged sales and traffic in different regions of the country. The Northeast, which includes Maryland, saw sales this year fall by 7 percent on Thanksgiving and Black Friday compared to a year ago. Traffic was down 5 percent.

Last year's Hurricane Sandy is still having a dampening impact on retail sales in the Northeast, Martin said. And the federal government shutdown in October — with the possibility of another occurring early next year — also has caused consumers to hold back on spending, he said.

Martin predicts brick-and-mortar retailers will experience a 2.4 percent gain in sales from November through the end of December.

Walmart was the target of national protests on Black Friday, including outside its stores in Towson and Arbutus, as part of a campaign to encourage the retailer to raise workers' pay.

The controversy apparently didn't hurt sales at the Arkansas-based retail giant, which reported record Black Friday sales. The retailer said it served more than 22 million customers on Thanksgiving Day, and processed more than 10 million transactions on its registers from 6 p.m. to 10 p.m.

Howard Davidowitz, chairman of the retail consulting firm Davidowitz & Associates Inc. said, based on talks with his retail clients and his own observations at stores in recent days, it was clear sales wouldn't be up from a year ago.

That's sure to disappoint retailers, he said, noting that they offered more and earlier sales promotions than ever. On top of that, retailers had to spend more themselves to keep their doors open additional hours.

"They spent more to do the same business," he said. "It was not a good arbitrage."


The reason for the so-so sales, Davidowitz said, is that many Americans haven't seen much improvement in their finances in recent years. The median family income is down from five years ago, he said.

Stores that cater to the middle class are unlikely to do well this season, Davidowitz said.

Meanwhile, the finances of the wealthiest 10 percent have only gotten better, which means retailers offering luxury goods should do well, he said.

"If you're Tiffany, you will be very happy," he said.

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