May 2, 2024
NEW YORK (AP) — Shoppers hunting for big deals packed malls on Black Friday as retailers stepped up discounts and offered other perks to entice hesitant customers who are sticking to stricter budgets this year.
Consumers are coming under pressure as their savings dwindle and their credit card debt grows. Although they have gotten some relief from easing inflation, many goods and services like meat and rent are still far higher than they were three years ago.
Yvonne Carey, 72, was among the first shoppers at Macy's Herald Square store in Manhattan where she snapped up discounted Michael Kors slippers and Ugg boots for herself. But Carey said she plans to stick to same $1,000 budget as last year as she shops for gifts for her six grandchildren and her husband.
“The prices are crazy on everything food, clothes,” Carey said.
Many retailers ordered fewer goods for this holiday season and pushed holiday sales earlier in October than last year to help shoppers spread out their spending. The early shopping trend accelerated during the pandemic when clogs in the supply network in 2021 made people buy early. But this year, retailers said more shoppers are focusing on deals and waiting until the last minute.
At Macy’s Herald Square store, shoppers began streaming in soon after the doors opened at 6 a.m., finding discounts of between 40% and 50% on boots and shoes and handbags. Diamond jewelry was discounted by 60%.
Macy's CEO Jeff Gennette told The Associated Press the crowds at Herald Square and other locations were bigger than last year, though he declined to give figures.
Facing competition from travel and restaurants, Macy's stepped up experiential shopping this season. At Herald Square, the Disney Princess shop had augmented reality allowing delighted youngsters to virtually step into one of the princess dresses.
“The customer is under pressure. You see it with what is going on in luxury. That is a recent development," Gennette said, adding that shoppers across all income levels are ”more discerning about how they are spending their budget.”
Best Buy said it’s pushing more items at opening price points, while Kohl’s has simplified its deals, promoting items under a certain price point like $25 at its stores.
Target said shoppers are waiting longer to buy items. While consumers have been resilient, Target's CEO Brian Cornell told analysts last week that "uncertainty, caution and managing a budget are top of mind.”
Gone are the Black Fridays of years ago when customers would stand in line for hours in the middle of the night, or brawls would break out over high demand items. Still, shopping on Black Friday remains a cherished tradition for many. Macy's at Herald Square was packed by mid-morning.
"I love doing it. I stay up the whole night just waiting for this day,” said Lisa Brooks, 45, a nurse from the Bronx who was at Macy’s early looking for perfume, socks and other items for herself and her mother.
Samuel Alvez, 44, and his wife ventured out for Black Friday shopping for the first time in years. At a Walmart in Germantown, Maryland, the couple bought two computer monitors and a pressure cooker but Alvez said he was disappointed in the discounts.
“Back in the day, they had these good deals in stores,” Alvez said. “Now, we don’t see that anymore."
In Europe, the UNI Global Union said it organized “Make Amazon Pay” strikes and protests in 30 countries on the busiest shopping day of the year, the fourth year of its Black Friday campaign against the online retail giant. More than 1,000 workers picketed outside the Amazon warehouse in Coventry, a city northwest of London, in a long-running dispute over pay, the GMB union said. Amazon said the strike will not affect customers.
Consumers spent $5.6 billion on Thanksgiving Day, when most of the major stores like Macy's and Kohl's closed and shoppers focused on online shopping, according to Adobe Analytics, which tracks online spending. That was up 5.5% compared with a year ago. For the first 23 days of November, consumers spent $76.7 billion online, up 6.8% from the same period a year ago. Online sales on Black Friday are expected to bring in $9.6 billion, up 5.7% compared with the year-ago period, Adobe said.
The National Retail Federation, the nation’s largest retail trade group, expects shoppers will spend more this year than last year, but their pace will slow given all the economic uncertainty.
The group has forecast that U.S. holiday sales will rise 3% to 4% for November through December, compared with a 5.4% growth of a year ago. The pace is consistent with the average annual holiday increase of 3.6% from 2010 to pre-pandemic 2019. Americans ramped up spending during the pandemic, with money in their pockets from federal relief checks and nowhere to go during lockdowns.
Online discounts should be better than a year ago, particularly for toys, electronics and clothing, according to Adobe. It predicts toys will be discounted on average by 35%, compared with 22% a year ago, while electronics should see 30% cuts, compared with last year's 27%. In clothing, shoppers will see an average discount of 25%, compared with 19% last year.
Analysts consider the five-day Black Friday weekend — which includes the Monday after the holiday known as Cyber Monday — a key barometer of shoppers’ willingness to spend. Black Friday is expected to be once again the busiest shopping day of the year, according to Sensormatic Solutions, a firm that tracks store traffic.
“Stores are humming, but there is no frenzy,” said Marshal Cohen, chief retail adviser at Circana, a market research firm, who visited 11 different malls in South Florida on Friday. He said shoppers are sticking to their list and don’t seem excited about the discounts out there.
