Shoppers aren’t the only ones caught up in a holiday rush this year, stores too are trying to capture what they see as a shrinking part of the marketplace. Speaking with CNBC, Ken Perkins — President of RetailMetrics — said consumers are “distressed,” and that retailers “know that they are well into a fight.”
Charles Holley, Wal-Mart’s Chief Financial Officer, reinforced that message with his statement to CNBC. He said this holiday season is “going to be as competitive of a market as we’ve ever seen.” As a result, Wal-Mart and other large corporations are slashing prices, offering deals to try and incentivize customers. The strategy has created the idea of “pre-Black Friday,” and “pre-Cyber Monday” sales. Cyber Monday, the National Retail Federation explains, came into being after retailers noticed a significant change in buying habits following the 2003 and 2004 holiday seasons. Consumers who did not, or could not, venture out to stores over the Thanksgiving holiday weekend ended up making purchases online the following Monday.
This year, the National Retail Federation says Shop.org has predicted online sales will increase this year by 13 to 15 percent. In total, it is expecting $82 billion worth of purchases to be made online in November and December.
On Monday, one week before Cyber Monday, Delta offered “24 Hours to Grab Great Global Deals.” American Eagle started offering 40 percent off everything, in stores and online, to “get a head start on Black Friday shopping.” Online sales are only a click away, making them potentially even more attractive for the holiday shopper who only needs to open their inbox to be presented with savings.
Black Friday and Cyber Monday are named based on shopping habits, and retailers are trying to combat the standard mentality to ensure money is spent on merchandise this holiday season. Loeb Associates Inc. is a consultancy for national and international retailers. It’s President, Walter Loeb, recently explained the pre-sale mania in Forbes. He attributes the hype to an unfortunately-timed Thanksgiving. The lateness of the holiday this year translates to six less shopping days. Six fewer days in the “traditional” holiday shopping season for stores to compete with customers.
With an already squeezed market, the shorter period heightened competition, causing stores to start offering promotions sooner. Loeb believes online sales will see somewhere between 13 and 16 percent more activity than last year. But Loeb has a warning as well. The retailers and suppliers collaborated on price so that fantastic deals could be offered at an earlier date. If stores misjudged and customers pick and choose certain items over others, sellers may be forced to lower prices even further as Christmas approaches to rid shelves of excess merchandise.