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Does weak traffic spell trouble for Black Friday?

Written by Tom Ryan

Traffic, as expected, is projected to have declined again over the first two days of Black Friday weekend.

ShopperTrak estimates that brick-and-mortar retail sales on Thanksgiving Day and Black Friday reached $12.1 billion on a combined basis, which is down from the $12.3 billion it projected over the same two days in 2014. Specifically, Thanksgiving Day grossed an estimated $1.8 billion in sales, while Black Friday garnered an estimated $10.4 billion in sales

Preliminary numbers indicate a decrease in shopper visits on both Thanksgiving Day and Black Friday versus last year.

Somewhat more encouragingly, RetailNext noted that while it found Black Friday was down 1.8 percent, the decline was considerably smaller than the monthly declines experienced throughout spring, summer and autumn of 2015. Including Thanksgiving, traffic was flat. RetailNext had previously found overall holiday traffic declined in 2013 and 2014.

The latest traffic decline on Thanksgiving and Black Friday was traced to holiday sales that began as early as Halloween this year. The heavy discounting was partly due to a warm November and some felt last week's doorbuster deals were lighter this year as part of a plan to spread sales throughout the season.

Shrinking store visits are also linked to consumers using computers and smartphones before hitting the stores.

NRF Thanksgiving weekend survey chart
NRF's 2015 Thanksgiving Weekend Survey

"Fewer visits on both days reinforce the trend we've seen throughout the year, in which shoppers are researching products ahead of time, targeting their store visits, and arriving in-store with the intention of making a purchase," said Kevin Kearns, ShopperTrak chief revenue officer, in a statement.

Finally, online is taking a bigger share of holiday sales, boosted by aggressive email campaigns and the expansion of mobile devices as shopping tools. Said NRF President and CEO Matthew Shay, in a statement, "It is clear that the age-old holiday tradition of heading out to stores with family and friends is now equally matched in the new tradition of looking online for holiday savings opportunities."

According to Adobe, online sales reached $2.72 billion on Black Friday, 14 percent more than in 2014, and $1.73 billion on Thanksgiving Day, a 25 percent increase. On Black Friday, mobile devices drove 53 percent of shopping visits (40 percent smartphones, 13 percent tablets) and represented 21 percent of online sales on the day.

While most are expecting online sales to still contribute less than 15 percent of overall holiday sales, retail executives were again left to defend brick-and-mortar stores and explain how online is reshaping shopping. Terry Lundgren, Macy's CEO, told CNBC on Friday, "The consumer likes that multi-dimensional experience today more so than ever. I think stores that are strong online, and strong in-store will be the winners of retail in the future."

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