By Sarah Nassauer, Suzanne Kapner and Khadeeja Safdar
Retailers dangled hefty discounts in their stores -- after
offering earlier deals on their websites -- as they waged a
high-stakes battle with Amazon.com Inc. and other rivals to capture
as much spending as they could during the Black Friday shopping
spree.
Shoppers arrived in the predawn hours Friday, following millions
of Americans who left family Thanksgiving gatherings Thursday to
visit malls and shopping centers. They scooped up flat-screen
televisions, toys and other gifts that retailers have been
promoting for days, but often had their smartphones in hand to
check prices.
Target Corp. CEO Brian Cornell said Thursday evening that he was
"very encouraged by the initial response," particularly to toys and
Apple Inc. products. He noted that hoverboards sold out early
online and highlighted the success of a $10 giant teddy bear.
"So far, the most encouraging trend we are seeing is that while
door-busters continue to be important," Mr. Cornell said, "once
guests are there, they are shopping multiple categories."
For brick-and-mortar retailers, the challenge is to draw more
shoppers into their stores on a chaotic day often marred by long
lines and crowded parking lots. Last year, more people shopped
online than in stores during the Thanksgiving weekend, according to
the National Retail Federation.
By 4:45 a.m. on Friday, Michael and Jessica Ansbro were close to
finished with their holiday shopping for the year. The Berne, N.Y.,
couple woke at 1 a.m. to hit department stores and GameStop, where
they stood in a short queue for the store's predawn opening.
The couple have been planning their holiday shopping since
September, putting toys for their sons, ages 4 and 7, on layaway at
Toys "R" Us. The couple are Amazon Prime members but have preferred
to hit the stores for Black Friday deals for the past decade.
"You actually know what you're getting," said Mr. Ansbro, 33, a
construction worker. "I like the sales, and I like to ask
questions," said Ms. Ansbro, 34.
Online shopping was on pace to reach $2 billion on Thanksgiving
Day, up 16% from a year ago, according to Adobe Systems Inc., which
tracked visits to e-commerce sites. But the revenue gains were
muted by hefty price cuts, especially on electronics, Adobe said.
Tablets, for example, were being discounted 25% on average
Thursday, compared with 12% a year earlier.
Sally Skupien, 49 years old, was one of about 50 people waiting
outside the Home Depot in Spring, Texas, at 5:30 a.m. Friday. Ms.
Skupien had come to buy an artificial Christmas tree and a table
saw for her husband, each of which were heavily discounted. But she
wasn't certain she would be the first to reach the tree she wanted,
so she also had gone online and added it to her cart.
"I'm too old to go in there and fight people for it," she
said.
A number of shoppers in the Houston suburb also said they went
to bricks-and-mortar stores because they weren't confident they
would be able to actually purchase door-buster items online, even
though they were offered.
"I try online every year, but it just hasn't worked, you can't
access everything online," said Betty Rasmus, 63, who arrived at
Best Buy at 4:45 a.m. and was the first in line, aiming to buy a
55-inch Sharp television for $250, about half price, as well as two
laptops.
Across the industry, retailers released advertisements of their
biggest deals three days sooner this year on average than last,
according to Market Track LLC, which analyzed emails, social media
and retail websites.
Consumer spending has been healthy this year, boosted by high
employment and rising wages. While there remain pockets of
weakness, especially among teen-apparel retailers and department
stores, many chains -- including Home Depot Inc., TJX Cos. and Best
Buy Co. -- reported healthy sales gains in the latest quarter. The
Commerce Department said U.S. retail sales through October logged
the strongest two-month stretch in the past two years.
In an effort to hold off advances from online rivals such as
Amazon, traditional retailers have been moving discounts earlier in
the month, linking their stores and websites more closely and
finding ways to capitalize on the rise in mobile shopping.
"Bricks-and-mortar stores are pulling out all the stops," said
Pete Madden, a director in the retail practice at consulting firm
AlixPartners. "They are making it clear they won't be beat on
price, service or products."
This year, shoppers are expected to spend $27 billion on the
Friday after Thanksgiving, according to consulting firm Customer
Growth Partners, making it the second-biggest U.S. shopping day of
the year -- behind Super Saturday, which falls the weekend before
Christmas.
By 5:30 a.m. Friday the crowds had thinned at the sprawling
Gateway Center in Brooklyn, with employees appearing to outnumber
shoppers at several stores.
Dante Pierre-Louis, 18, and his younger brother pried their
father out of bed at 4 a.m. to take them shopping. Mr.
Pierre-Louis, home from college for the holiday, said he mostly
shops online but wanted to hit stores to spend time with his
family.
He jumped up-and-down in excitement upon finding a deeply
discounted faux-fur throw blanket at Target, and also got some
hoodies for 25% off. "When it's crazy, it's exciting to see
everyone running around," he said. "But now you have a better
chance of actually getting what you need."
"I don't miss the crazy," said Christine Aguirre, a 37-year-old
office manager, as she pushed a cart filled with two televisions
and other goods. She woke at 4 a.m., a 20-year tradition even
though most stores she shops at now open on Thanksgiving and not
early Friday. "It's better now, it used to be so packed."
Black Friday is no longer a one-day event; promotions are
increasingly spread throughout November, as traditional retailers
try to match more nimble online rivals.
Toys "R" Us Inc. made its Black Friday deals available to online
shoppers on Wednesday night, before stores opened at 5 p.m. on
Thanksgiving.
Kohl's Corp. for the first time made "door-buster" deals
normally reserved for in-store shoppers such as a $250 Samsung TV
and a $130 Fitbit wristband available online, starting at midnight
Thursday, before stores opened at 6 p.m. that day.
Amazon started its deals on Nov. 1. The web giant is offering
new discounts every day, sometimes as often as every five minutes,
through Dec. 22. In preparation for the holidays, Amazon expanded
its product offerings by 30%, the equivalent of 3.6 million new
products, according to 360pi, a retail pricing- and
assortment-tracking firm.
The risk is that early spending will pull dollars from later in
the season. That pattern has occurred over past Thanksgiving
weekends, as more stores opened on Thursday and siphoned sales from
Friday. As a result, more retailers and malls stayed closed on
Thanksgiving this year.
The National Retail Federation forecasts total holiday shopping
will rise 3.6% to $655.8 billion from a year ago, with 137.4
million people shopping in stores and online during Thanksgiving
weekend alone.
In what some analysts have dubbed the "Trump Bump," they are
hopeful that President-elect Donald Trump will stimulate the
economy and lower taxes, which means "a large segment of the
population that was previously reluctant to spend," Citi analyst
Paul Lejuez wrote in a research note, "now feels better."
This year, 23% of Americans plan to shop in stores on Black
Friday, according to a survey conducted by Bankrate.com, a
financial-services company.
At a Wal-Mart Stores Inc. location in Washington, D.C., on
Thursday evening, Jose Francisco was hoping to buy some electronics
that he said were a few dollars cheaper than at Best Buy. "I
planned ahead," said the 30-year-old who lives in Germantown, Md.,
as he scrolled his smartphone for online prices.
However, Amazon will still get a large chunk of his holiday
budget, he said, based on lower prices for videogames for his
nephew. "I have another list for that," he said.
--Sharon Terlep, Bradley Olson and Sara Germano contributed to
this article.
Write to Sarah Nassauer at sarah.nassauer@wsj.com, Suzanne
Kapner at Suzanne.Kapner@wsj.com and Khadeeja Safdar at
khadeeja.safdar@wsj.com
(END) Dow Jones Newswires
November 25, 2016 10:39 ET (15:39 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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