BUSINESS

Copying Black Friday mayhem north of border a short-sighted strategy: analyst

11/29/2013 05:24 EST | Updated 01/29/2014 05:59 EST
WASHINGTON - It's not just the occasional shooting, trampling or pepper-spraying incident that tarnishes the value of the Black Friday tradition: some analysts question its value as an economic yardstick and marketing strategy.

One Canadian retail expert said he understands why stores in Canada are adopting the U.S. event as a marketing tool, but he believes they could do better.

Steven Tissenbaum of Ryerson University's Ted Rogers School of Management said Canadian stores might have better luck retaining customers if they focused their energy on customer service, not on mimicking Black Friday prices online or across the border.

"Forget about pricing. You can't compete on price," Tissenbaum said in an interview.

"Provide a level of service that differentiates Canada — where Canadians see they're appreciated, that they should stay here, that they should spend their dollars here."

The importance of the day for U.S. retailers is frequently underscored by dramatic — often violent — scenes.

Amid one stampede for deals this year, a woman was reportedly trampled at a Walmart in Boston. A Virginia man was stabbed in an argument over a parking spot. In California, a brawl sent a police officer to hospital.

Those incidents and many others are chronicled on the website Blackfridaydeathcount.com. There have been several fatal incidents in the past, including a man being trampled at a Target, and a double-shooting at a Toys R Us in California in 2008. There was also a pepper-spraying at a North Carolina Walmart in 2011.

Of course, in most places, the annual tradition goes off without casualties.

In fact, employees at one mall in Washington, D.C., said Friday was just a busier-than-average weekday — but no busier than some other days. The Target store at the DC USA mall had lineups outside the store the previous night as people hoped for the so-called "doorbuster deals." On Friday, it was offering $75 gift cards for iPads and discount vouchers.

"You're getting your typical Saturday or Sunday foot traffic on a Friday," said store manager Darran Whitlock.

"What you're getting is that initial (pre-Christmas) surge."

Tissenbaum said it's easy to understand why retailers in Canada, especially the U.S.-based ones, would feel compelled to copy the annual event as they compete with one another for a share of people's holiday gift budget.

It's part of an industry-wide trend to snap up those limited dollars as early as possible. In what has been likened to a retailers' "arms race," Kmart ran a gingerbread-cookie-themed Christmas ad in September this year and Walmart was promoting its holiday layaway plan as early as August.

Black Friday is a key element of that trend to court customers earlier.

Its origins developed somewhat more organically in the U.S., as shoppers frequently began hunting for Christmas presents on the holiday Friday after Thanksgiving, in the midst of a multi-day festival of turkey, football and family time.

An American linguist has tracked down the phrase "Black Friday" to a half-century ago.

Ben Zimmer, who writes a language column for newspapers, said there's evidence of Philadelphia police officers using the term to gripe about all the downtown traffic from the deluge of shoppers.

Factory bosses also used it, he said, to complain about worker absenteeism the day after Thanksgiving. Zimmer said retailers initially resisted the term, and tried to rebrand it as "Big Friday." But by the 1980s he said they gave up and started to embrace it, albeit with their own personal spin: that this was the day annual profits were made and balance sheets went "black."

Still, one researcher warns against overstating the event's economic importance.

In a study last year, Paul Dales of Capital Economics found no relationship between strong Black Friday sales and pre-holiday sales overall. In fact, he found a small inverse relationship.

Years with high Black Friday volumes actually saw smaller returns in subsequent weeks, he said. That's because retailers are scrambling for finite resources, he said.

"People sort of have a fixed amount to spend over the holidays," Dales said in an interview from the UK.

"If they spend more on Black Friday they just spend less later on — or vice versa... It's certainly an important day for retailers. I just think it's misunderstood."

The Wall Street Journal has described the event as "retail theater," following a recent investigation that it said showed Black Friday essentially consists of stores dropping prices that are artificially inflated in the first place, as part of a well-choreographed routine to make shoppers feel proud of their bargain-hunting and spend, spend, spend.

"It's not that big a deal unless you get one of the 'doorbusters,'" said a Best Buy employee at the DC USA mall.

In reference to the shoppers lined up outside, the clerk joked: "Do you people have families?"