Black Friday midnight openings: No going back

  • Article by: THOMAS LEE and WENDY LEE , Star Tribune
  • Updated: November 26, 2011 - 12:02 PM

The tough economics of holiday shopping suggest that retailers have set a "new baseline."

The midnight bell has struck resoundingly.

Retailers such as Target Corp. and Best Buy Co. Inc. said Friday they were not yet ready to declare their 12 a.m. Black Friday gamble a success. But judging by the millions of shoppers who poured into malls and big-box stores midnight Thursday combined with the brutal economics of holiday retail, 12 a.m. store openings are the industry's new normal.

There's no going back.

"Retailers have set the new baseline," said Carol Spieckerman, president of newmarketbuilders, a management strategy consulting firm in Bentonville, Ark. "At the end of the day, it's one of an arsenal of tactics retailers need to deploy between now and the end" of the holiday shopping season. It's too early to tell if retailers generated more sales from opening earlier this year. But in a way, it really doesn't matter. Holiday retail today has become so competitive that retailers need every hour they can squeeze out of a day to ring up a sale or risk losing it to the other guy. The National Retail Federation predicts holiday sales this year will grow just 2.8 percent to $465 billion.

Black Friday is often the busiest day of the year for retailers and sets the tone for what they need to do for the rest of the holiday season. If sales are strong, stores typically can charge more for items because they know their inventory will sell. A lackluster Black Friday almost guarantees price cuts because they need to get rid of the holiday items by Christmas.

Overall, malls and retailers reported large midnight crowds. The Mall of America's midnight opening attracted 15,000 people, a number that later swelled to 81,000 by 10 a.m. The mall said it will break its previous Black Friday record of 200,000 visitors, set last year.

"It was very strong traffic," said Derrek Geary, manager of the Macy's department store at the mall. "We are pleased with the numbers of shoppers."

Target officials say its stores drew on average about 1,500 people, almost five times the amount of people it normally gets at 4 a.m.

"It seemed like people were out in overwhelming numbers," CEO Gregg Steinhafel told the Star Tribune. "Numbers I have not seen in a long time."

However, he said it's too early to say whether Target will open again at midnight in 2012.

"We will reassess at the end of the year," Steinhafel said. "We're not making any commitments for next year right now."

Opening at midnight carries significant risks, said Devon Wolfe, managing director of strategy and analytics services for Pitney Bowes Business Insight. Retailers must pay more to operate stores at longer hours, he said.

At the Midway St. Paul Target store around 3 a.m., cashiers were standing at the end of their checkouts, waiting for customers. The workers stocking shelves and waiting to ring up sales outnumbered customers filling their carts.

Retailers also risk backlash from unhappy employees and consumers, Wolfe said, despite retailers' insistence that customers wanted earlier hours.

"I'm pretty sure they haven't done any consumer research," Wolfe said.

The earlier hours could even wind up costing retailers sales. Consumer who prefer the 4 a.m. openings might have shopped further into the day vs. starting their quest at 12 a.m.

Michael Lee, a 42-year-old engineer waiting for the Bloomington Target to open at midnight, said he wishes stores would return to 5 a.m. openings.

"I think it's a disruption," he said. "I think a holiday ought to allow people to spend more time with their family."

Lee said he will probably spend about four hours shopping on Black Friday this year, compared to at least six hours last year, because of fatigue.

On the flip side, younger shoppers say they prefer the midnight openings.

At the Mall of America, youthful consumers crowded such teen stores as Forever21 and athletic apparel retailers like Nike.

Audrey Mundstock, who arrived at the mall at 11:45 p.m. on Thanksgiving night with her friends, said she normally doesn't wake up early enough for the 4 or 5 a.m. openings. By the time Mundstock, a 17-year-old student at Southwest High School in Minneapolis, gets to the mall later in the afternoon on Black Friday, most of the stores are already cleaned out, she said.

With the midnight opening, "you're still kind of awake from the day, and that transfers the energy to shopping," said 18-year old Katie Harlin, who also attends Southwest High School.

Mundstock bought $142 in clothes from retailers Gap, Eddie Bauer and Gilly Hicks, money she would not have spent if the stores had opened at its typical time. She planned to look at more stores in the mall.

"Since we're here, we might as well," Mundstock said.

It was 2 a.m.

Staff writer Kara McGuire contributed to this report. tlee@startribune.com • 612-673-4113 wendy.lee@startribune.com • 612-673-1712

  • related content

  • Shopping in person: A ritual made of bricks and mortar

    Friday November 25, 2011

    Even as online sales rise, many shoppers still relish storming into stores for after-Thanksgiving doorbusters.

  • All of the bags belong to Nabih Elteir of Egypt, who had been shopping at the Mall of America for more than 24 hours.

  • get related content delivered to your inbox

  • manage my email subscriptions

ADVERTISEMENT

Connect with twitterConnect with facebookConnect with Google+Connect with PinterestConnect with PinterestConnect with RssfeedConnect with email newsletters

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

 
Close