Target joins Walmart to close its stores on Thanksgiving Day, ending a long tradition of driving Black Friday sales.
NEW YORK – Target is teaming up with Walmart to close its stores on Thanksgiving Day, ending a long tradition of boosting black door sales on Friday.
The move, announced Monday, comes as stores are reconsidering this year’s Black Friday shopping bonanza weekend, along with other key retail days during the holiday season, as the country battles the pandemic of coronavirus.
Stores always relied on large holiday crowds and work up to a year in advance with manufacturers to secure exclusive items. Now, the virus has turned the Christmas shopping model around. Stores have reduced orders and crowds are anathema. Fearing a wave of virus cases in the fall, the biggest nightmare would be if retailers had to re-close during the most critical time of the year, analysts said.
“Historically, searching for deals and Christmas shopping can mean crowded events, and this is not a year for crowds,” said the Minneapolis-based Target in a published corporate blog. He said his vacation deals would come sooner than ever, starting in October.
Walmart, the country’s largest retailer, announced its move last week.
Target first opened on Thanksgiving Day in 2011, teaming up with other stores to start Black Friday sales the day before and creating a new tradition of shoppers heading to stores after their turkey party. Many retailers did so because they were trying to better compete with Amazon and other online players.
But sales ended up consuming Black Friday and many critics criticized stores for not honoring the holiday and allowing its workers to spend it with the family. In response to backlash and low sales as well, some stores and malls like the Bloomington, Minnesota-based Mall of America have changed course and have not opened on Thanksgiving in recent years. Costco and Nordstrom, among others, have always been closed for Thanksgiving, signaling that they want to respect the holidays.
The bigger question still arises about how to handle Black Friday itself, which also draws large crowds, and sales. Despite the competition of Thanksgiving shopping, Black Friday ranks as the highest or number 2 sales day of the year.
Thanksgiving isn’t even in the top 10 because sales start around 5 p.m., but on the day it ranked third in online shopping behind Cyber Monday and Black Friday respectively last year, according to Adobe. Analytics, which tracks online sales for 80 of the top 100 retailers.
Walmart and Target declined to comment on their plans for Black Friday, but analysts say they believe retailers will boost their business more online and focus on limiting the number of shoppers in stores. Like Target, other retailers are also likely to start Christmas sales even earlier to stretch the crowds.
Macy’s CEO Jeff Gennette said earlier this month that department stores will be focusing their Black Friday business more online and will likely “go full force” with Christmas marketing right after Halloween. There will also be amazing events to reduce customer traffic in the store.
Still, boosting online sales will likely be more expensive for retailers due to shipping costs. And while many stores like Macy’s will increase curbside pickup for the first time this holiday season, that strategy will create logistical challenges to meet shopper holiday demands.
Sucharita Kodali, an e-commerce analyst at Forrester Research Inc., said the profit margins retailers earn on online sales are 50% to 80% of what they earn when buying the same item from the store.
“This will be a very tough holiday season in terms of where sales will come from,” said Joel Rampoldt, managing director of the AlixPartners retail practice.
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