Hello User
Sign in
Hello
Sign Out
Subscribe
Save BIG. Mint+The Economist at ₹3999Claim Now!
Next Story
Business News/ Economy / Black Friday Deals Start Early, but Shoppers Are Choosy This Year

Black Friday Deals Start Early, but Shoppers Are Choosy This Year

Retailers are navigating a holiday season in which shoppers aren’t splurging as much as they have in recent years.

Black Friday weekend could be a boon to retailers as shoppers scan the landscape for standout deals.

Millions of Americans are headed to stores on Black Friday, but retailers are navigating through a holiday season in which shoppers aren’t splurging as much as they have in recent years.

Many households have already begun their gift buying in a year when high prices for food and other inflation have sapped demand for apparel, home décor and other items people may want but not need.

After two years of pandemic-fueled spending, executives say they are bracing for choosy consumers and last-minute holiday buying that could spur deeper discounts.

“We are preparing for a customer who is very deal-focused," Best Buy Chief Executive Corie Barry said earlier this week. She said the electronics chain expects shopping to return to typical patterns, when purchases are clustered around Black Friday, Cyber Monday and the last two weeks of December.

Consumers continue to pull back spending on most of the goods Best Buy sells, including electronics, cellphones and home appliances. The retailer is ready for a promotional environment and is advertising goods such as electric bikes and beauty products that are selling well with the slogan, “Yes, Best Buy sells that."

Walmart, the country’s largest retailer by revenue, is offering discounts on giftable products such as Barbie dolls and other toys, said John Furner, chief executive of Walmart U.S. The company plans seasonal discounts, what Walmart calls “rollbacks," on twice as many items this holiday compared with last year, he said.

Ahead of the holidays, Walmart is focused on lowering grocery prices so shoppers can spend more on other items, John David Rainey, Walmart’s chief financial officer, said on a recent call to discuss quarterly earnings. There was a marked slowdown in spending in the last two weeks of October, Rainey said.

Sarah Heir, a veterinary nurse who lives in Cary, N.C., is pulling back on unneeded purchases this year as grocery prices rise, as well as asking her family for more practical gifts for her toddler son, such as tickets to the zoo.

“If someone bought me two giant boxes of diapers instead of a stuffed animal, that would be the best gift ever," said the 28-year-old mother.

Overall holiday sales growth is expected to be weak. Signs ahead of the holidays, including rising consumer debt and fewer boxes moving on railroad cars, show that sales could be slower compared with recent years when a rush back to stores after the early pandemic and built-up savings sparked spending.

The National Retail Federation expects overall sales increases could be in line with the slower pace seen in the decade leading up to the pandemic, from 2010 to 2019, when the average annual increase over that period was 3.6%.

The industry group expects November-December spending, not including inflation, to rise 3% to 4%. By contrast, sales rose 5.4% in 2022, 12.7% in 2021 and 9.1% in 2020.

Spending continues to grow online, a trend that slowed briefly last year as people returned to stores after the early years of pandemic-related store avoidance. In November, online shopping increased about 5% to $63.2 billion spent through Nov. 20 compared with the same period last year, according to data from Adobe Analytics. Shoppers gravitated to deep discounts on electronics, toys and apparel, said Adobe.

“It’s about market share at this point," said Janet Hayes, chief executive at Crate & Barrel, which sells high-end home goods. Shoppers are gravitating to nostalgic, traditional items—such as monogrammed stockings and wine glasses—as they balance spending, she said.

For years, retailers, including Crate & Barrel, have trained staff to alternate between stocking shelves and working on registers, often a labor cost savings. This holiday season Crate & Barrel hired people who are especially speedy, friendly cashiers to shorten in-store checkout lines, said Hayes. “We don’t want any friction points in the store," she said.

Black Friday weekend could be a boon to retailers as shoppers scan the landscape for standout deals. Some shoppers plan to spend more, but on fewer gifts to manage their finances amid still-elevated prices this holiday, said Lupine Skelly, retail research leader at Deloitte, a consulting firm.

“They are saying ‘Hey, if I am going to spend, it’s going to be during these heavily promoted times,’" said Skelly, whose assessment was based on Deloitte consumer surveys leading into the holidays. “We see this as a critical week for retailers."

Write to Sarah Nassauer at Sarah.Nassauer@wsj.com

3.6 Crore Indians visited in a single day choosing us as India's undisputed platform for General Election Results. Explore the latest updates here!

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
Get the latest financial, economic and market news, instantly.