Viewpoints

Food Retailers Should Weigh In on Black Friday

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Believe. Merchants had faith and it magically happened.

Over 200 million shoppers spent an estimated $52 billion on Black Friday, up an estimated 9% over last year. The witching hour — many doors opened at midnight — came and went. Black Friday is now old news, but hope prevails that the spending frenzy can continue.

What's the takeaway for food retailers about this year's Black Friday? Could supermarkets cash in on the food side with a big event or could Black Friday sales cut into food sales?

Black Friday 2011 turned out as a milestone marketing event that drove stampedes of shoppers on, of all days, Thanksgiving to buy stuff such as Rampage boots, Xboxes and wide-screen TVs. Merchants haven't seen these kind of sales numbers from the herd in several years.

Take note on what led to a successful Black Friday.

A well-executed event drives record sales. The holiday spending spree was triggered by the big event and media hype. Food retailers mostly bypass Black Friday, but they might consider a holiday food event with deeply discounted prime beef or Christmas ham sales to the first 100 customers that walk through the door.

Early birds take the prize. No question the fourth-quarter holiday push is getting earlier. Planning for 2012 starts the day of Black Friday's door-buster specials. Supermarkets should plan now for an early move of next year's Christmas trinkets onto the floor.

They'll come out for deep discounts. Merchants offered 40% to 70% off select merchandise. Shoppers will spend if the deal is hot enough. Food retailers will have a difficult time holding onto any healthy margin under this shopping mentality.

Mobile mobilizes. Smart digital gadgets and apps were used to incentivize and move traffic akin to the Occupy movements. Retailers are harnessing the power of digital devices to no small change and food retailers should do the same.

Ecommerce continues to gain. Cyber Monday, which began in 2005, followed Black Friday's record sales pattern with an estimated $1.2 billion, up 9% from the previous year. Retailers who have brick-and-click capabilities have an edge.

Credit is back as card sales rose 7.4% on Black Friday, possibly raising debt and cutting savings. Could prove troublesome for food retailers going into January when shoppers ask: Where's the money for the food?

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Julie Gallagher

Julie Gallagher’s delicious foray into coverage of the food industry was purely accidental. With a background in technology, she joined Supermarket News as associate editor of its Technology...

Mark Hamstra

Mark Hamstra is the editor of the Retail/Financial section of Supermarket News covering mergers and acquisitions, quarterly earnings reports, executive changes and other significant events and trends...
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