TGT Target Corp

By Suzanne Kapner and Sarah Nassauer 

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 Samsung televisions, Hatchimals toys and other gifts that retailers have been promoting for days -- but often had their smartphones in hand to check prices.

"So far, the most encouraging trend we are seeing is that while door-busters continue to be important, once guests are there, they are shopping multiple categories," Target Corp. chief Brian Cornell said late Thursday.

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.

On Friday morning, Macy's Inc. CEO Terry Lundgren said he was seeing more opportunity to grow sales as a whole this holiday season, compared with last year when online gains came at the expense of physical stores. "This year, there is more opportunity to grow the pie," Mr. Lundgren said. "Last year, when business was challenging, the pie was being divided in more ways."

RetailNext Inc., which collects data through analytics software it provides to retailers, said online sales increased 14% on Thanksgiving compared with the same day a year ago, while sales at brick-and-mortar stores fell nearly 18%. RetailNext attributed the drop in sales at physical stores to fewer stores opening on Thanksgiving.

Marshal Cohen, retail analyst at NPD, said he saw evidence that Thanksgiving openings and online deals were stealing business from Black Friday. "In the 40 years I've studied Black Friday, I've never seen the crowds this soft on Friday morning; parking wasn't an issue, and lines were shorter than any weekend in October," he wrote.

By 5:30 a.m. Friday the crowds had thinned at the sprawling Gateway Center in Brooklyn, N.Y., with employees appearing to outnumber shoppers at several stores. "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 at a Target on Friday morning. "It's better now; it used to be so packed."

Although more people are doing holiday shopping online and know that the same deals or better can be found there, many Black Friday shoppers said they still wanted to try on clothes, shoes or household items.

"I know you can get the deals online, but I don't think you get the gratification," said Tara Christy, 34, who drove nearly two hours with her cousin to shop in Kansas City. By 9 a.m. the crowds had died down.

Retail CEOs credited a stronger economy and pent-up demand following the presidential election for helping drive traffic to stores. "With the election earlier in the month, things were soft," Kohl's Corp. chief Kevin Mansell said. "That put a lot of pressure on this weekend. It looks like results will come in equal or better to our expectations."

The executives cited strong sales of smartwatches and other electronics such as videogame systems and TVs. Coats and other winter goods got a lift from a cold snap that hit the East Coast just before this year's Thanksgiving, said Jerry Storch, the CEO of Hudson's Bay Co., which owns Saks Fifth Avenue and Lord & Taylor.

But it was the sharply discounted goods that were the big draw. J.C. Penney sold out of 200,000 pairs of diamond stud earrings priced at $20 each.

Even though the chain doesn't make money on that item, shoppers purchase other goods while in the store, "so you come out ahead," said Penney chief Marvin Ellison.

While some shoppers said they hit the stores out of tradition, many consumers said they were largely focused on grabbing deeply discounted items. Some shoppers said they went to brick-and-mortar stores because they weren't confident they could get door-busters 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 in Spring, Texas, 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.

Black Friday is no longer a one-day event. Promotions are increasingly spread throughout November, as traditional retailers try to match online rivals such as Amazon. They have been linking their stores and websites more closely and are finding ways to capitalize on the rise in mobile shopping.

Amazon said Friday that Thanksgiving was becoming one of the biggest mobile shopping days on the site, with orders exceeding both Thanksgiving and Cyber Monday last year. Wal-Mart said mobile orders accounted for 60% of its Black Friday event sales that were purchased online.

Others used their smartphones to avoid the stores altogether. James Seatter, 24, purchased a vacuum cleaner on his phone from Amazon and gifts for his father on BrooksBrothers.com. He plans to continue his online shopping Monday. "I don't want to fight with someone over a toaster oven at Wal-Mart," he said.

--Sharon Terlep, Bradley Olson and Annie Gasparro contributed to this article.

Write to Suzanne Kapner at Suzanne.Kapner@wsj.com and Sarah Nassauer at sarah.nassauer@wsj.com

(END) Dow Jones Newswires

November 26, 2016 02:47 ET (07:47 GMT)

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