Retailers Would Be Better Off Without Black Friday

The calendar is cruel to retailers this year. Thanksgiving comes on Nov. 28, the latest its been since 2002, making the upcoming holiday shopping season shorter than last years by six days. The compressed season will cost retailers $1.5 billion in online sales alone, according to a report released today by Adobe Systems (ADBE), which doesnt attempt to measure the fallout from lost in-store sales.

The calendar crunch is putting even more pressure on retailers to try to inch the holiday season ever earlier. And sure enough, stores continue to turn the day after Thanksgiving into one thats unrivaled in length, a sort of shopping solstice. At Kmart (SHLD), for instance, Black Friday will last 41 hours this year, starting at 6a.m. on Thanksgiving. Macys (M) and J.C.Penney (JCP), meanwhile, will also be open on Thanksgiving for the first time. The November holiday has become the fastest-growing day for online shopping, according to Adobe, seemingly destined to overtake Black Friday (if not Cyber Monday).

So why not just get rid of the whole Black Friday tradition altogether? Retailers might actually be more successful without the consumer frenzy. The Thanksgiving-less shoppers in places such as the U.K., the Netherlands, and Canada spend more than Americans during the holiday season, Adobes research found, despite the absence of a Black Friday starting gun to ignite the shopping.

Tamara Gaffney, an analyst with Adobe, argues that the Black Friday custom tricks retailers into leaving money on the table and that everyone would be better off detaching shopping from Thanksgiving.Our official start date here called Black Friday, which will eventually be Thanksgiving, is preventing online sales from occurring, she says.

The quirks of this years calendar make jumping past Thanksgiving even more tempting. Karen Hoguet, chief financial officer at Macys, recently told investors that the short holiday season has the company focused on persuading people to spend in November.Theres some people who are saying the six fewer days is negative, but I keep saying November, December hasnt changed, she said. You still have the same number of people to buy gifts for.

So will retailers just keep chipping away at the calendar until Black Friday shopping merges with trick-or-treating? Unlikely, says Sucharita Mulpuru, an analyst at Forrester Research (FORR). But the reason has less to do with economics and more with emotion.

Black Friday is just a tradition in America, she says. Its as much the sport that people get up and wait in the dark. I dont think that will ever go away.

Source: http://www.businessweek.com/articles/2013-11-05/why-retailers-would-be-better-off-without-black-friday