REI knows ‘Black Friday’ isn’t ‘Black Friday’ anymore, so closing its stores won’t hurt, but only help the brand
REI, a unique co-op retailer whose members pay a fee to belong, got unimaginable publicity with its announcement that its stores will remain closed on ‘Black Friday.’
#OptOutside, which encourages its members to spend the day with family and friends enjoying the outdoors, is perfectly on-brand. But even more importantly, it got the kind of media attention that no amount of paid advertising could ever hope to achieve.
It is win-win for REI with absolutely no downside, since ‘Black Friday’ isn’t ‘Black Friday’ anymore. Retailers’ conventional wisdom is that on ‘Black Friday,’ the day after Thanksgiving, the bottom line of retailers’ account books goes from red ink to black as annual losses turn to profits. It might have been true once, but not anymore, according to a new report on the gifting market from Unity Marketing.
With more and more retailers trying to push the holiday shop-fest into Thanksgiving, REI and a growing group of retailers (Costco, DSW, TJ Maxx) are deciding to opt-out. It’s a lesson other brands should learn: If you want to get noticed, turn left, when everyone else is turning right.
The fact is retailer’s fourth quarter isn’t producing the results it once did, as shoppers’ behavior has changed. Back in 1995, nearly one-third of the typical retailers’ revenues was generated in the last three months of the year. In 2014 it had dropped to 29.4% The fourth quarter is not the money maker it once was for retailers.
The incredible build up retailers make around the Christmas holiday shopping season is no longer paying off. Yearly retail sales quarter-to-quarter are flattening out and retailers’ chance to sell to the gift giver isn’t an end-of- the-year opportunity any longer, but one that extends throughout the entire year, this based upon the new Gifting Report, based upon a survey among 1,650 gift shoppers (avg. income $97.9k).
Unity Marketing estimates that the gifting market totals $131.3 billion, and represents about $1 out of every $10 spent in the type of stores that fill America’s malls and shopping centers, the ‘big boxes’ that line the streets and highways and the shops along main streets across the country.
And increasingly, more of those gifting dollars are not going to those stores at all, but being spent online, as gifters turn to the internet to select, research and buy gifts.
Amazon.com surges ahead to be gifters’ favorite shopping destination, knocking out Target & Walmart, tied as their favorites in 2010
Internet shopping for gifts is a real game changer that is disrupting the gifting market, having replaced discount department stores and mass merchants, including the websites of those stores, as their preferred gift shopping destinations. That means Target, Walmart, Kohl’s and others are losing a big share of the gifting business to Amazon.com, eBay.com, Groupon.com, Etsy.com and other etailers.
While the annual year-end holiday gifting season receives the lion’s share of marketer and retailer attention, the reality is that gifting represents a significant marketing opportunity throughout the whole year. Out of the typical gifters’ annual gifting budget, Christmas accounts for slightly less than half of the total. The majority of gift purchases are made the rest of the year.
Unity Marketing’s new Gifting Report provides data, insights and a five-year perspective of trends into what gifts people are shopping for by holiday and occasion, the destinations they favor for gift shopping, as well as what they look for when considering gift selections and places to shop.
Marketers and retailers need to understand the gift buying and shopping behavior of customers in order to attract them and meet their needs with suitable gift ideas and gift shopping experiences. This report details an important trends and statistics for retailers and marketers to use to get their best gifting strategies on.