Black Friday Sales Tumble 13% On Thanksgiving Thursday Opening Scramble

Tyler Durden's picture




 

Update: more data trickling in from the NRF, and since it is not pretty,  so expect much more blame to fall on the weather.

  • U.S. consumers spent $57.4b over Black Friday weekend, down from last year’s $59.1b, National Retail Federation says
  • Consumers spent avg. $407.02 (planned), down from $423.55 in 2012

* * *

If somehow the scramble to open stores earlier and earlier on Thanksgiving day, until such time as the very Thanksgiving dinner had to be interrupted early for the annual rush out to the (un)friendly neighborhood Thug-Mart (Toys'R'Us opened at a ridiculous 5pm on Thanksgiving day) and punching people in the face just to get that 42 inch, 2010-model Plasma TV for $99, was supposed to boost overall sales instead of merely pulling them forward (see cash for clunkers), it didn't work. According to ShopperTrak, total Black Friday traffic plunged 11% and total sales fell 13.2%, the second consecutive year of declines following last year's 1.8%. The reason, as largely expected, is that a substantial portion of Friday shopping was pulled back to Thursday: as ShopperTrak founder Bill Martin said, "if retailers continue to promote Thanksgiving as the start of the holiday buying season, he thinks the holiday will eventually surpass Black Friday in sales. "We're just taking Black Friday sales and spreading them across a larger number of days," Martin said."

Combining Thursday and Friday retail sales represented a 2.8% increase in traffic and a 2.3% increase in actual sales compared to the same period last year, which however took place against the backdrop of the most aggressively promotional environment ever, leading to even greater drops in retailer margins.

The bigger problem for retailers, and the economy, is that the National Retail Foundation expects sales to be up 3.9% to $602 billion for the season, which encompasses the last two months of the year. That's higher than last year's 3.5% growth, but below the % pace seen before the recession. Unfortunately, starting off the holiday shopping season at a selling pace that is 40% below the run-rated growth projection is hardly encouraging for the hoped for increase in sales, as well as  US GDP, not to mention the disposable income state of the US consumer.

Sure enough, since reality once again intruded on economist "models" it was time to blame the weather. From the WSJ:

The ShopperTrak report showed strong traffic in the Western and Southern U.S. while visits in the Northeast slipped as a cold snap may have deterred some customers. Apparel and accessories stores saw more visits on both days, while gadget sellers suffered weaker traffic throughout the period, the firm said.

 

About 140 million people are expected to shop over this holiday weekend, a decline from the 147 million who planned to do so last year, according to the National Retail Federation. The trade group said that nearly a quarter of the people it surveyed planned to shop on Thanksgiving Day.

There is hope the weak start to the retail season will be salvaged by online sales, which have been progressively climbing as a percentage of total, accounting for 40% of the $59 billion in sales racked up over the four-day Black Friday weekend last year, up from 23% in 2006, according to the National Retail Federation. Store traffic this year has been sluggish amid slow growth in consumer spending. That transition is expected to persist according to the WSJ:

During the first 17 days of November this year, store traffic declined 4.8% from the same period the year before, according to Retail Next, which analyzes more than nine million shopping trips nationwide within 450 stores.

 

Meanwhile, online shopping is set to rise, with 51% of shoppers surveyed by Nielsen planning to buy something over the Internet on Friday, up from 38% last year. That compared with 48% of consumers who said they planned to visit a big-box store like Target or Wal-Mart.

Curiously, some shoppers were turned off by the Goliath in the online selling space, Amazon.

Andrea Bailey is one of those online shoppers, but she wasn’t on Amazon. Around 2 a.m. Thursday morning, she was sitting at a laptop in her living room in Lexington, Ky., refreshing Best Buy’s website. When she finally got through, she bought a $99 Kindle Fire, made by Amazon, for her 8-year-old son.

 

After a couple of hours of sleep, Ms. Bailey continued her shopping spree, buying sweaters and Christmas pajamas for her 5-year-old daughter and dress shirts for her husband from Macys.com, some Disney Infinity characters for her son from Toysrus.com and a new printer from the Sam’s Club website.

 

Altogether, Ms. Bailey spent nearly $400 before noon. She finds it easier to browse websites run by brick-and-mortar stores than to deal with Amazon’s overwhelming number of options, she said: “If I go on Amazon and look at videogames, holy moly, my brain hurts.”

 

Such big retailers as Wal-Mart and Target continue to struggle to keep up with Amazon on the Web. Despite years of effort, online sales still typically account for only around 2% of sales for the two chains.

And while online sales are a far easier way of getting shopper "feet in the door", the margin erosion to vendors once the competition is unleashed, is far greater than even from brick and mortar venues which have at least some discipline in preserving margins.

To be sure, the full impact of the early start to selling season will not be known for a few more days, as Cyber Monday's impact is becoming increasingly greater and will have to be taken into consideration to determine just how strong, or weak, the US consumer is.

Finally, speaking of US consumers, recall that "strong" Thanksgiving sales were trumpeted every year between 2009 and 2012 only for the final holiday sales tally to disappoint without fail every single year. It remains to be seen if this time will finally be the opposite, as Bernanke's "wealth effect" finally trickles down to the 99%. Or not.

0
Your rating: None
 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Sun, 12/01/2013 - 14:25 | 4203756 TeamDepends
TeamDepends's picture

Shop 'til you drop.  Or get stabbed or can't get up because you are being trampled by jelly-bellies.

Sun, 12/01/2013 - 14:48 | 4203821 Winston Churchill
Winston Churchill's picture

The good news is  though, shoplifting is up 25%.

Sun, 12/01/2013 - 15:11 | 4203873 Groundhog Day
Groundhog Day's picture

went to do my Sunday grocery shopping at Costco and the traffic is lower than normal week past Best Buy and Walmart and the parking lot war average

Sun, 12/01/2013 - 15:58 | 4203964 Miffed Microbio...
Miffed Microbiologist's picture

Driving to work Black Friday at 7AM there were freeway sign in numerous places warning people to watch for slow traffic nearing off ramps to malls. Each one I drove by had very little traffic, none spilling onto the freeway. I assumed people werent getting up early for sales but 3 people who came later told me they saw the same. I was shocked. Can't be the weather because it's 61 degrees here. Well, for us we do consider that cold. Could this be another side effect of Obamacare?

Miffed;-)

Sun, 12/01/2013 - 16:10 | 4203986 Boris Alatovkrap
Boris Alatovkrap's picture

Boris is ride bike to pub.

Sun, 12/01/2013 - 19:03 | 4204437 kaiserhoff
kaiserhoff's picture

I couldn't log into Amazon this morning the first few times I tried.

They may finally be coming up against some structural barriers in the all things to all people mode.

Sun, 12/01/2013 - 20:26 | 4204782 Pure Evil
Pure Evil's picture

Well, what do they expect when the zombies are more interested in killing each other than buying electronic crap from China.

Sun, 12/01/2013 - 21:03 | 4204900 StychoKiller
StychoKiller's picture

"Everybody believes in something, I believe I'll have another beer!"

Sun, 12/01/2013 - 16:15 | 4203996 Skateboarder
Skateboarder's picture

Lower foot traffic is either because of online shopping or because people have a lot less to work with than they did last year, just like the year before, and next year too.

Sun, 12/01/2013 - 16:28 | 4204021 garypaul
garypaul's picture

According to QE logic, if there was a Black Monday, Black Tuesday, Black Wednesday, Black Thursday and Black Friday, then retail sales would be 5X bigger!!

Sun, 12/01/2013 - 16:41 | 4204074 Skateboarder
Skateboarder's picture

"To encourage consumer spending and confidence, we have decided to host Black Friday on the last friday of every quarter.

Yours Truly,
                    choomgolfer666"

Sun, 12/01/2013 - 17:21 | 4204205 12ToothAssassin
12ToothAssassin's picture

Another miss blamed on weather?

Sun, 12/01/2013 - 19:08 | 4204550 akak
akak's picture

Like 40+ consecutive years of bad Soviet grain harvests.

Sun, 12/01/2013 - 16:51 | 4204107 j0nx
j0nx's picture

Move out of district 11 and into the capital. Shit in the DC area is booming. $650k houses are flying off the shelves and stores are packed. The good old days are here again in this area. Pretty much any and all wealth in this nation is becoming highly concentrated in DC and NY. These fuckers are ruining this area for middle class folks. If you want a house here now you basically live with the mezcans and blacks or you become house broke or you rent until you can move away like us.

Sun, 12/01/2013 - 17:23 | 4204212 CheapBastard
CheapBastard's picture

Some job areas are brisk still. Houston energy corridor (Cinco Ranch, Katy, Fulshear) is pretty active still but places like Austin and Dallas and other parts of Texas, Arizona and NM are stagnant with less job growth and serious oversupply.

Sun, 12/01/2013 - 20:33 | 4204800 yogibear
yogibear's picture

Healthcare private -pay individual rates are up 50% from 2010 (Bluecross min  policy).

Up another 15% this coming year. It's eating away at whatever is left. 

Only thing left for many people is to charge and default on it next year. 

Sun, 12/01/2013 - 15:30 | 4203907 TeamDepends
TeamDepends's picture

That is good news!  For Wackinhand anyways.  Wait, is it Whack-in-hut?  You know, the security dudes.  What's that?  Well, yes we are completely hammered.  Sure, go ahead and judge but you do realize the ship is sinking?  There's the water rushing in right there!  Uh-huh.  The band is kicking ass, isn't it!  Why yes, we will dance!

Sun, 12/01/2013 - 15:39 | 4203919 johngaltfla
johngaltfla's picture

Well, well, well. Let's review the standard media response form and see which one CNBSFBSNBBSG uses tomorrow morning:

 

1. It's the government shut down.

2. It's cold weather.

3. It's the Republican's fault.

4. It's Bush's fault.

5. All of the above.

 

I look forward to the bullshit spraying session which will commence when the U.S. business networks resume their seldom viewed normal business programming at 0600 tomorrow.

Sun, 12/01/2013 - 15:49 | 4203940 Rubbish
Rubbish's picture

$400 average? I make decent money and you are lucky when I buy a new $300 tower....ha ha

 

Ok I splurge on Gold coins :)

Sun, 12/01/2013 - 16:00 | 4203967 fxrxexexdxoxmx
fxrxexexdxoxmx's picture

Bush is just like a god now. A GOD I tell ya. He is everywhere, all the time, all seeing and all knowing.

 

Thanks Barracky and the Dem machine you have made a new GOD.

Sun, 12/01/2013 - 15:40 | 4203923 Colonel Klink
Colonel Klink's picture

Or lard asses!

Sun, 12/01/2013 - 16:22 | 4204008 Paveway IV
Paveway IV's picture

I'm too lazy to scroll back to whatever post you replied to, but I gave you a thumbs up because 'lard asses' is always a crowd-pleaser.

Sun, 12/01/2013 - 16:44 | 4204086 Jumbotron
Jumbotron's picture

Keep it up you fucktard retail stores.  Here;s a fucking clue.   WE'VE GOT NO MONEY LEFT TO BUY YOUR SHITTY CHINA iCRAPPERS ANYMORE.  AND WE ARE SICK OF YOU OPENING UP ON THANKSGIVING DAY.  DIE EVERYONE OF YOU BRICK AND MORTER DINOSAURS !!!

Sun, 12/01/2013 - 16:56 | 4204126 A Nanny Moose
A Nanny Moose's picture

Is the overall 2.3% increase adjusted for inflation?

Sun, 12/01/2013 - 20:48 | 4204849 Notarocketscientist
Notarocketscientist's picture

.... because we all know real inflation is around 10% / yr ----  so even if 2.3 is adjusted to CPI we know that is bogus --- so what we can conclude is that the total inflation adjusted sales volumes have dropped considerably.

Sun, 12/01/2013 - 23:34 | 4205467 A Nanny Moose
A Nanny Moose's picture

Yup.

Mon, 12/02/2013 - 08:22 | 4206057 CheapBastard
CheapBastard's picture

Don't be so hard on the Chinese. I actually found 1 shirt Hecho en El Salvador'...but the lady told me it was probably actually Hecho in China then transferred to El Salvador where they changed labels and then shipped up here. It's a way to avoid import duties by China she said.

Sun, 12/01/2013 - 14:40 | 4203771 q99x2
q99x2's picture

Not only that Jamie Dimon and the president of the new world order gave the crooks on SSI their money two days early so they would help jack sales.

This ship is going down.

BitCoin is coming down for the whammy mammy. Last Price 980 and falling fast.

Sun, 12/01/2013 - 14:53 | 4203830 TeamDepends
TeamDepends's picture

Quick!  Get fonestar on the fone!  Should we yank our BTC out of the, um, ether, and sink them in the lake or use the old rectum safe....

Sun, 12/01/2013 - 20:57 | 4204872 Exponere Mendaces
Exponere Mendaces's picture

@TeamDepends

Just keep posting like a moron, I guess. It seems to be your individual strength.

That and playing to a crowd of technophobic gold-hoarders.

(What, too much? Well, he did come swinging out of the gate. I thought this was Fight Club?)

Sun, 12/01/2013 - 14:32 | 4203782 jal
jal's picture

Only the credit card companies will know the truth.

Sun, 12/01/2013 - 20:36 | 4204805 yogibear
yogibear's picture

Guess more demand for stolen CC numbers. Charge on someone else's credit.

Sun, 12/01/2013 - 14:34 | 4203788 rum_runner
rum_runner's picture

eh... this is basically in line with America's priorities.  I be tankful affa I get mah big screen tee-vee. 

Sun, 12/01/2013 - 14:37 | 4203792 Pooper Popper
Pooper Popper's picture

You Buy NOW!!!!

Sun, 12/01/2013 - 14:36 | 4203794 oddjob
oddjob's picture

My sales were up big this year, I sold a substantial amount of paper at the bullion exchange.

Sun, 12/01/2013 - 15:35 | 4203916 RafterManFMJ
RafterManFMJ's picture

Now that's funny!

"Here, I'll exchange my slave coupons for those barbaric, shiny discs and rectangles..."

Sun, 12/01/2013 - 14:36 | 4203795 Motorhead
Motorhead's picture

That means the market should continue to hit record (nominal) highs tomorrow (on Monday).

Sun, 12/01/2013 - 14:37 | 4203798 km4
km4's picture

Tyler you shoukd do a post on this.....US and European governments gained $1.6 trillion from low interest rates on the backs of over 50 year old savers and pensions http://feedly.com/e/_1EMSoLq 

 

Sun, 12/01/2013 - 14:56 | 4203838 Tyler Durden
Tyler Durden's picture

That was the same study that "found" that QE had not boosted stock prices.

Sun, 12/01/2013 - 14:38 | 4203799 Carpenter1
Carpenter1's picture

This is a good measure of the % of sheeple left standing. We now effectively have three groups of people, but only two groups know it. There's the complicit, the awake, and the sheep.

Sun, 12/01/2013 - 16:02 | 4203972 fxrxexexdxoxmx
fxrxexexdxoxmx's picture

Baaaaa Baaaa Baaaa I have now idea where I fit in.

Sun, 12/01/2013 - 16:21 | 4204006 Wile-E-Coyote
Wile-E-Coyote's picture

Talking of sheep the New Zealand people speak.............

https://www.youtube.com/watch?feature=player_embedded&v=QcE5aDTszrY

Sun, 12/01/2013 - 14:44 | 4203812 adr
adr's picture

They'll cook the books and claim spending increased nomatter what. Any truth may derail the full retard stock rally. I can't fathom why retail stocks have been soaring, the real numbers have been horrible.

My local Macy's did $30k in the first hour last year. This year it took the whole day to hit $30k. My wife's mall store beat last year by $100, but the discounts were heavier so total profit was way below last year.

 Friday was a did past the added 9am doorbusters. Yesterday was like any other Saturday, practically deserted. I surveyed the scene on Saturday. At Best Buy, Target, Walmart, Home Depot, etc there were still Thanksgiving door busters left. I overheard a Target manager tell a stock boy to get everything left in the back out on the floor in the hope it would sell.

Pallets of $99 Dodge Viper Power Wheels sat on the floor Saturday night. The sale was over at closing. Something like that which is $189 retail sitting unsold is almost unbelievable compared to past Black Fridays.

I'd say this was the worst year for retail in history. 

Sun, 12/01/2013 - 14:50 | 4203825 insanelysane
insanelysane's picture

CNBS spin tomorrow will be that you should be buying stocks based on next year's Black Thanksgiving shopping.

Sun, 12/01/2013 - 14:59 | 4203848 CrashisOptimistic
CrashisOptimistic's picture

What is unfolding is the good news is bad news analog with taper.  Bad news means no taper so up risk.  Good news threatens taper so flee risk (because bad news is so frequent now, there haven't been many of these days).

For individual companies, bad news means they will have to do more share buybacks to polish up Earnings Per Share (and also the CEO's resume).  Good news means they won't do that so much and in silly fashion actually rely on making money to push the stock price.

Sun, 12/01/2013 - 15:46 | 4203936 stocktivity
stocktivity's picture

It's all Bullshit!!!

Sun, 12/01/2013 - 16:25 | 4204012 CrashisOptimistic
CrashisOptimistic's picture

"Finally, speaking of US consumers, recall that "strong" Thanksgiving sales were trumpeted every year between 2009 and 2012 only for the final holiday sales tally to disappoint without fail every single year. It remains to be seen if this time will finally be the opposite, as Bernanke's "wealth effect" finally trickles down to the 99%. Or not."

 

Tyler's last para, posted BEFORE the update showing a 3.7% in spending decline for the whole weekend.

This, of course, means taper off and more share buybacks and blame for the shutdown and Sequester.

Sun, 12/01/2013 - 14:47 | 4203819 insanelysane
insanelysane's picture

The idiots that lined up on Friday last year are the same idiots that went out on Thanksgiving this year.  Ponzi's need more idiots to keep going unfortunately the government is not producing idiots at a fast enough rate.  Not for a lack of trying but probably due to poor execution.

Sun, 12/01/2013 - 16:06 | 4203979 fxrxexexdxoxmx
fxrxexexdxoxmx's picture

If I stop my wife from shopping I do not get blowjobs. She can shop anytime she wants and I do not have to use my hands.

She is also the most intelligent women I have ever known. She does her thing and I get my thing.

Sun, 12/01/2013 - 16:53 | 4204114 Papasmurf
Papasmurf's picture

So long as you can make "deposits" as fast as she spends, you have a good thing going!

Do NOT follow this link or you will be banned from the site!