The 5 Biggest Myths About Black Friday
The holiday shopping season officially kicks off this week with Black Friday, the busiest shopping day of the year. Seasoned shoppers will head out early to hunt for the best deals, including the elusive “doorbusters,” limited quantity, heavily marked-down items designed to lure people into stores.
But big as it is, Black Friday isn’t what it once was. Many stores don’t even wait until Friday to start the holiday rush; they’re opening their doors on Thanksgiving evening (recast as “Gray Thursday” by the industry) for people who are more ravenous for delicious deals than for turkey and stuffing. And then there’s Cyber Monday, the online equivalent three days later, which eats further into the brick-and-mortar sales each year.
Plus, there’s Buy Nothing Day, an ongoing attempt by activists to claim the day after Thanksgiving as one of consumer abstinence to draw attention to the problem of overconsumption. The festivities are highlighted by flash-mob events such as “Whirl-mart,” in which participants push empty shopping carts around the store in a conga line. The Buy Nothing movement exposes Black Friday as nothing but binge-shopping madness.
In that spirit, here are five ways Black Friday is little more than dubious hype.
1. “Black Friday” refers to the day when retailers turn a profit. It’s commonly believed that Black Friday signifies when many U.S. retailers go “into the black” or hit the break-even point, but retailers generally break even, and indeed profit, nearly every quarter.
The first known use of Black Friday in reference to the day after Thanksgiving is in an article published in 1951 that bemoans the high level of worker absenteeism on that day. In the early 1960s, the term was used by traffic-weary Philadelphia police officers to describe the hordes of cars and people that would descend on the city streets to shop at department stores.
It wasn’t until the mid-1970s that the alternative and mythical explanation emerged (that retailers traditionally operate at a financial loss from January through late November).
2. Black Friday is an effective economic indicator. It’s widely believed that strong sales on the weekend after Thanksgiving is a bellwether of consumer confidence and show how strong holiday sales will be. But Black Friday is actually a poor indicator of both.
Economist Paul Dales of Capital Economics, a leading macroeconomic research firm, says that Black Friday receipts don’t always correlate to seasonal sales. Dales analyzed 20 years of sales figures from Thanksgiving week against the sales from November through January and found little correspondence between them. For example, Dales found that in 2004, when there was a weak Black Friday, holiday sales were relatively strong. Conversely, in 2008, strong Black Friday sales were not the harbinger of continued strength through the season. Moreover, the U.S. was entering a recession at that time and the economy continued to tank.
Now that retailers are encouraging holiday shopping before Thanksgiving and more people are shopping online, the correlation between Black Friday, the holiday shopping season and U.S. economic strength might even become more tenuous over the years.
3. The best deals are on Black Friday. Not every sale you'll find on Thanksgiving weekend will be the biggest bargain of the year, or even the holiday season. Nestled among the deals, you’ll see a lot of items that are selling at either their regular retail price or close to it.
Erika Adams of Racked.com, a shopping intelligence website, says she has seen ample proof that you can find better deals later in the holiday season and even after Christmas. She notes that Black Friday is just the first in a series of competitive sales geared toward moving inventory out the door.
"Staggering sales on big-screen TVs and 24-hour shopping sprees play into the Black Friday hype, but in reality, most retailers are just looking to join the fray with some sort of sale—and not necessarily the best one,” she writes. Still "the prevailing idea that Black Friday is the mother of all sale holidays continues to stick with consumers.”
The Wall Street Journal confirms that Black Friday sales aren’t all they’re cracked up to be, citing data from 2013 showing the lowest retail prices were actually on Thanksgiving Day and the Monday preceding it.
Be aware that retailers are also playing a mild version of the old bait-and-switch on Black Friday. While they advertise deep discounts on some popular items, they often don’t have enough in stock to satiate consumer demand. These sales, known as “doorbusters,” are loss leaders solely meant to get hordes of people into the store. The retailers then bank on disappointed shoppers not wanting to go home empty-handed and settling for items that aren’t so attractively priced.
Don’t rush out to buy an item on Black Friday just because you think it’s the best deal you’re going to get all year. That's often not the case. Instead you should research the pricing of any item you’re considering beforehand, and even call competing retailers and ask if they expect having more aggressive sales in the coming weeks.
4. You can only get doorbuster deals at brick-and mortar stores. To those who wait in line for hours to get a doorbuster deal, you’re probably wasting your time. While it’s true that Black Friday — and now Thanksgiving — is often a good day to pick to get one of these fantastic deals, many retailers now offer the same price at the online store to attract shoppers there. In fact, DealNews.com reports that 70% of the doorbuster deals you see at a store are also available online.
Keep in mind that brick-and-mortar retailers like Target, Costco and Best Buy are also competing online. Also, online-only retailers such as Amazon.com and Blue Fly, typically match doorbuster deals, and often have more items in stock.
5. Large retailers will match competitors' prices. To keep customers in their stores, most of the larger brick-and-mortar retailers have price-matching policies. If you show a circular from one store that has a cheaper price for a product than the store you’re in, they promise to match it. Consumers love price-matching because it allows them to visit one store instead of several to get the lowest prices.
Well, this might work most of the year, but on Thanksgiving weekend, all bets are off, according to Cheapism.com. The website, which bills itself as “consumer reports for the cheap,” says that some retailers, notably Best Buy, Target, OfficeMax, and Office Depot will not match competitors’ prices on sale items this weekend. However, Lowes and Home Depot will not only match each others' prices, they’ll beat the price if you bring in the other store’s circular.