What digital did to Black Friday
November 27, 2017
Larry Gerbrandt takes time out at Thanksgiving to explain how digital technology is changing US lifestyle and traditions.
Ask the average US citizen to name their favourite holiday and the answer is likely to be ‘Thanksgiving’. It is a holiday (always celebrated on the third Thursday of November) steeped in generations of tradition. It not only generates record travel (even more than Christmas) it also triggers the largest economic event of the year: Black Friday, when Americans traditionally have flocked to retail malls and stores by the tens of millions, drawn by deep discounts and sales promotions.
The National Retail Foundation (NRF) estimates 69 per cent of all Americans will shop during a four-day period beginning on Black Friday and ending on Cyber Monday. It is an annual ritual of excess, from huge family meals (often featuring roast turkey that is ceremonially carved by the clan’s patriarch), hours of American football watching on TV, followed by huge queues at dawn the next day at major retail centres hoping to score the best deals (the supply of the deepest discounted merchandise is often intentionally limited). Like lemming migrations, the behaviour patterns have not only been predictable but seemingly equally instinctual. Until now.
For the first time, a larger portion of the American population plans to shop online than in retail stores over Thanksgiving based on NRF survey data. Despite unemployment levels at record lows and a stock market that has notched a series of record highs in 2017, there have been a record number of retail chain bankruptcies, with even more expected in 2018.
Something very fundamental has changed in the American lifestyle and it can be traced directly to the e-commerce revolution championed by Amazon and the ability to window browse for deals from any smartphone, with the purchases conveniently delivered to one’s doorstep a handful of days later. Subscribers to Amazon’s $99/year Prime service not only get free shipping on most purchases, they also get access to its SVoD offerings featuring billions of dollars spent on original TV series and movies.
Instead of spending Black Friday braving the long lines at malls (and endlessly circling overcrowded parking lots searching for an empty space) Americans now have the option of not only shopping from the comfort of their living room couches but also binge-watching their favourite TV series. According to the latest Nielsen Total Audience report, the average time the average American aged 18+ spent using an app or the Web on their smartphone increased by more than an hour per day (from 1:58 to 2:59) between the second quarter of 2015 and the same period in 2017.
Retailing is just the latest in a long line of traditional industries that have been profoundly transformed by the Internet and ubiquitous broadband and the trend is not likely to reverse itself, even at the expense of time honoured traditions.
The more interesting question is which sector, media and otherwise, is next for radical change as the digital revolution bulldozes through modern society. Fintech, is already being impacted by the explosive rise in cryptocurrencies, led by Bitcoin and Ethereum.
Data and identity security could be the most transformative from a cultural standpoint, especially in the wake of massive breaches in companies ranging from Uber to the US credit reporting giant Equifax. Possibly the most profound change on the horizon will come in medical monitoring and tracking (I already track my heart rhythm, oxygen consumption, blood pressure and weight using a series of smartphone apps and relatively inexpensive connected devices).
The movie-going experience is expected to be transformed by virtual reality, which will have an equally profound impact on gaming and professional sports viewing. If there is a cautionary tale in the American Black Friday data, it is that attempting to hold back the digital tide of change rarely succeeds. Even the most time-honoured traditions could become unrecognisable by the time the Millennials start forming their own families.