Black Friday isn’t what it used to be. Here’s why.

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Black Friday arrives at what could be a make-or-break moment for retailers already struggling with excess inventory, higher fixed costs and increasingly jaded consumers.

And despite today’s waning relevance — it’s been turned into a months-long sale — merchants of all sizes are digging in.

“I think there’s more weight this year than we’ve seen in years past,” said Adam Davis, managing director of the retail division at Wells Fargo Capital Finance. “It’s critical that retailers get the consumer’s share of the wallet, and so they will try to … lock in those sales.”

But analysts and industry experts warn that Black Friday sales may be muted this year. Earlier and steeper sales – while beneficial for strategic shoppers – hurting retailers whose margins are suffering from overstocked inventories and rising labor costs.

Meanwhile, consumers are showing signs of fatigue after struggling with decades of high inflation for most of the year. They got a bit of a reprieve in October: Prices rose 7.7 percent from a year earlier, according to federal data released earlier this month. While still well above normal levels, it was lower than analysts had expected. Even wealthier Americans feel pinched, polls show. They still buy, but choose cheaper options.

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“We are in unique economic situations — inflation is at a 40-year high, and many families’ budgets are being squeezed from all fronts,” said Jie Zhang, a professor of marketing at the University of Maryland. “So there’s not as much enthusiasm for opening wallets coming into this holiday shopping season.”

Third quarter financial results, consumer surveys and retail sales data provide insight into how Black Friday may play out. Last week, the Census Bureau reported that retail sales rose 1.3 percent in October. But much of that spending was on necessities like food and gas. Americans also continued to pull back on technology and appliances.

These numbers are important to economists and policymakers because consumer spending makes up more than two-thirds of the U.S. economy. Cooling demand raises fears of recession. At the same time, the Federal Reserve has tried to bring prices down by raising interest rates. The labor market remains strong, which has helped consumers continue to spend.

In its holiday forecast, the National Retail Federation said sales would grow 6 to 8 percent across all categories and digital purchases would increase 10 to 12 percent. Estimates are not adjusted for inflation. The average shopper will spend $832.84 on gifts and holiday items, the NRF said, which is in line with the 10-year average.

Over the past few years, the novelty of Black Friday, which got its name because the speed of sales could turn retailers’ books from red to black, has slowly waned.

The big shopping day was once synonymous with doorbuster deals and long pre-dawn lines. Sunil Singh, 61, used to look forward to Black Friday – not just for the deep discounts on tech gadgets, but also because it meant spending time with his son. The two had a tradition of lining up before sunrise outside Best Buy in the San Francisco Bay Area in anticipation of the opening.

“The whole thing of waking up at 4 a.m., lining up, you know, drinking hot cider and coffee in line, waiting for two hours, chatting with people, it was just a really fun time,” said Singh, of Mountain View, California. .

But as his son grew up and online shopping became easier and more productive, there was little need to show up for in-person sales.

“The deals, you can get them online,” he said. “You get such good offers weeks, ten days ahead. So it’s no longer so meaningful.”

“It has lost its novelty,” Singh added.

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The rise of e-commerce shattered the Black Friday shopping experience. Now, retailers are making it easier than ever for people to buy on their websites, apps and in-store, said Harley Finkelstein, the president of e-commerce platform Shopify.

“I think about Black Friday, Cyber ​​Monday [have] kind of turned from a weekend into a season,” Finkelstein added. “And I think consumers like that because it means they can get more of their shopping done earlier.”

Shoppers are also increasingly dependent on social media: A global survey conducted by the IBM Institute for Business Value in partnership with the National Retail Federation found that 6 out of 10 shoppers get “inspiration and ideas” from TikTok, Instagram and other sites. The platforms allow for a seamless browse-to-buy shopping experience, and with younger demographics spending more of their time on apps, brands and businesses are bringing their products to them.

But retailers are still taking steps to get people back into stores, said Shawn Grain Carter, a professor at the Fashion Institute of Technology.

“If you go into the brick-and-mortar store, they often have extra doorbuster sales because they’re trying to drive traffic,” she said, adding that after years of covid fears and crowd restrictions, shoppers want to be back in stores . “The pandemic has forced more consumers to realize that they want human connection and contact.”

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