Black Friday Sales: A Solid Holiday Kickoff, With Warning Signs for Retailers

Consumers showed up on Black Friday ready to shop, but it took deep discounts to get them to actually buy something.

In-store and online sales rose 3 percent year over year on Black Friday, according to data from Mastercard. Over the weekend, consumers spent an estimated $22 billion online, up 8 percent from last year, according to Adobe Analytics, which expects Cyber Monday to bring in an additional $9 billion.

All in all, it was a solid kickoff to the holiday season, particularly in a year that has seen slowing retail sales growth. Several factors propelled purchasing. Because the holiday shopping window is shorter this year — there are 26 days between Black Friday and Christmas compared to 31 days in 2023 — brands began promoting their Black Friday deals as early as Oct. 1, but particularly within the week before Thanksgiving. Not only did it give consumers more time to shop, it also likely increased the urgency to buy before products sold out. The growing resistance to higher prices in fashion also served as a push for shoppers to buy while items were marked down.

But brands struggled to figure out how far they needed to go with their discounts. Some retailers kept their promotions the same as last year, while others offered steeper markdowns, and started discounting earlier in the season, to drive sales. That disparity was highlighted on social media as people complained about retailers offering smaller discounts — think 10 to 20 percent.

The type of deals that retailers were willing to offer over the weekend reflected how they’ve fared throughout the year. Companies with products in high demand focused more on protecting their profit margins than on delighting customers with rock-bottom prices. Athletic footwear maker Hoka, which saw Google searches for its brand the week of Black Friday rise 20 percent year over year, according to data from investment bank Needham & Company, raised the spending threshold for its Black Friday gift with purchase promotion to $250 from $175 last year. On the other hand, brands that have struggled to grow sales this year went deeper with their discounts. For example, Crocs-owned HeyDude, which saw its third-quarter sales dip 17 percent to $204 million, offered 60 percent off most of its goods online, along with an additional 25 percent off already marked down items.

Black Friday also provided signs of consumers’ evolving post-pandemic shopping habits. Especially among Gen-Z, in-store shopping has made a comeback over the last two years, setting off an e-commerce growth slowdown and prompting more digitally native brands to enter physical retail. But Mastercard SpendingPulse estimates that online sales jumped 15 percent on Black Friday, while in-store sales were essentially stagnant, increasing less than 1 percent. Analytics firm RetailNext reported that foot traffic in stores across the US decreased 3 percent on Black Friday. (It wasn’t a complete freefall, however: commercial real estate giant Simon saw a 6 percent year-over-year increase in traffic at stores across its 200-plus retail properties.)

It’s all a reminder that we’re in a new era of Black Friday: No longer is the year’s biggest shopping event contained to a day, or even a weekend. Shoppers today aren’t seduced by “doorbuster deals” that proliferated in the aughts, where shoppers clamoured early in the morning after Thanksgiving to nab steeper markdowns, according to an October survey by Deloitte. Instead, when it comes to sale shopping, younger consumers seem to prefer to buy goods online so they can compare deals across retailers — and avoid long lines.

The continued pursuit of low prices this holiday season, along with some brands’ willingness to offer discounts earlier this year, is likely a sneak peek into shopping behaviour in the coming year.

President-elect Donald Trump is expected to impose higher tariffs on imported goods when he reenters The White House in January, which experts predict will drive up prices on everything from tomatoes to $5 dresses on Shein. How brands managed their discounts over the weekend — either choosing to offer higher markdowns earlier or keeping promotional activity to a minimum — is one indication of how that dynamic will play out.