By Lisa Johnston
New products on display at the American International Toy Fair, held in N
NEW YORK – Revenue and sales metrics are clearly central to any Black Friday analysis. But given the emotional component of the Black Friday shopping experience, no retail report on the Thanksgiving weekend would be complete without a first-hand account of the selling scene. Here are four:
Steve Smith, editor in chief, TWICE: For about a decade or more I have been visiting the same three stores on Black Friday at around the same time – 9 a.m. to noon – P.C. Richard & Son, Best Buy and Costco, all in Long Island City in Queens, N.Y.
Traffic was greater at the P.C. Richard location than in the past couple of years. Store manager John Bogdanos said the store again opened at 4 a.m. and that there was steady business throughout the morning, particularly in big screen TVs. “Lots of TVs moving since we opened,” he said, driven by sale items like a 51-inch Samsung plasma for $478.91.
Traffic was also greater and departments looked busier than last year at the Best Buy location, particularly within the video game and digital imaging sections. District services manager Jonathan Hommel said, “We opened at midnight and it was very busy. We sold tons of TVs … laptops were very popular too. We also sold plenty of gift cards for iPads and iPods.”
At Costco store traffic was less than what I remember in previous years, but as store manager Jon Jovel said, traffic in the CE department was steady and, like at Best Buy and P.C. Richard, big screen TVs and laptops were popular. With all the talk about online sales and the fading star of TVs and laptops, it was interesting to see that those categories were the most popular in the stores I visited.
At all three stores bigger-screen TVs — from 55 to more than 60 inches — were aggressively priced, especially models by Sharp and Samsung.
Alan Wolf, senior editor, TWICE: Crowds in Central New Jersey ebbed and flowed following store openings, making it difficult to gauge shopper turnout. This area had been battered by Hurricane Sandy, suggesting that at least some purchases were replacement sales for damaged CE and appliances, or personal rewards for weathering the storm and its aftermath.
Bobby Jakub, a multichannel sales associate at a big-box Best Buy location in Eatontown, N.J., said his store was busier than last year when it opened again at midnight. Customers began queuing up the day before Thanksgiving, and by opening hour lines extended around the building.
The crush continued until about 2:30 a.m., when the crowds “evened out” and became steadier, Jakub said. Top sellers were TVs and laptops, he noted, particularly a 40-inch Toshiba 1080p LCD TV for $180 and a 15.6-inch lowend Lenovo laptop for $188, both doorbuster items.
Traffic at a Middletown, N.J., Sears store, once labeled a “B” location by senior management, was slow by midmorning. Most of the activity was within the appliance department, where customers ogled a Kenmore top-load washer and steam dryer laundry pair that was marked down 50 percent to $650 each for Black Friday.
At a Costco store in Hazlet, N.J., a CE department sales associate said traffic had been steady all week as the warehouse club publishes a Thanksgiving- week coupon mailer in lieu of a Black Friday event. Big sellers were Samsung’s 55-inch LED TVs, with three steps for basic, smart and 3D models. Customers tended to opt for those over a more competitively priced 60-inch Vizio LED “with all the bells and whistles but slightly lower picture quality,” he said.
At a Target store in Holmdel, N.J., the noontime checkout scene within the CE department was the same frenzied tangle as last year’s visit, with lines extending in multiple directions and clerks struggling to keep up with the flow. Customers were mostly buying small items, including iPads and iPods, movies, video games and digital cameras.
A late-day visit to a Walmart store in Neptune, N.J., revealed a surfeit of inventory, as workers hand-trucked skids of tier-two flat-panel doorbusters off the sales floor and back to the stock room. Not that traffic was light — a sales associate said the crowds at the 8 p.m. opening on Thanksgiving Day were massive, much greater than the prior year, necessitating a police presence and her reassignment to security duty at the front end of the store.
Adam Levin, CEO, Levin Consulting: As the mass merchants use CE products more and more as their key doorbusters, it creates a different kind of opportunity for CE retailers — selling accessories. This morning I personally saw more than 200 TVs leave Walmart and Target with customers ... and none with surge protectors, and less than 5 percent with HDMI cables. It was clearly folly (a nice word for stupidity) that these great merchants did not have the proper accessories located near the doorbusters nor at the registers, nor did they have clerks (not salespeople, no way) suggest buying these needed enhancements.
Nevertheless, Walmart did a great job of keeping customers coming back, with their three different waves of specials. They also seemed to have more inventory than a year ago, allowing them to increase customer satisfaction and store comps. Lines at the beginning of the day were 10 percent to 20 percent greater than last year, and our estimate is that their sales volume was up five percent to 7 percent for the first twelve hours. Overall we give them a grade of A-, and rate them a Day One winner.
Another winner was consumers, using the Internet for informed shopping decisions. With the ease of true comparison shopping (and don’t worry, consumers can see through derivatives and private brands), good deals create stronger demand than ever before ... and not so good deals do not sell all at all. Basically hot products take much greater share than in the past, and stepping up to higher margin products that do not have compelling value propositions is a much tougher ballgame.
h.h.gregg was the real disappointment. Crowds varied widely by store, averaging 300 to 400 in line before opening. People waited one to two hours for their 9 p.m. opening and then waited another hour or two to get in, as they limited the number of people in the store at any given time. Comps were down 10 percent to 15 percent in our opinion, different than their recent earnings announcement as sales of their growth categories were not as strong on Black Friday. Checkout is still awful, slow and slower, but great job on attachments – h.h.gregg does the best job of any national player in that regard. Overall the specials were not as strong as their competitors, and it showed in traffic counts and volume. Grade: C.
David Strasser, hardlines retail analyst, Janney: We visited Walmart, Target, Best Buy and various other stores on Thanksgiving night and saw strong traffic across the board. Apparently, people were looking for an excuse to cut the meal short and hustle from the family. Traffic was strong through the early morning until at least 2 a.m., with the majority of retailers/malls opening at midnight, highlighting aggressive door busters. Black Friday early morning traffic was weak, but we attribute this change in traffic patterns to a simple shift to Thanksgiving night.
After losing last year to Walmart, Target appeared back in action with aggressive deals and effective marketing, particularly to their Red Card members. Door busters such as a Nook reader for $49 (vs. $59 at Barnes & Noble), $60 off on iPad, and bundle offers for video games, all brought life to the CE category.
This TWICE webinar, hosted by senior editor Alan Wolf, will take a look at what may be the hottest CE products at retail that will be sold during the all-important fourth quarter. Top technologies, market strategies and industry trends will be discussed with industry analysts and executives.