No sooner was the last trick-or-treater safely back at home counting their haul before the marketing onslaught began for Black Friday sales.
For the consumer who has (perhaps smartly) unsubscribed from nearly every email distribution list, Black Friday began after Halloween and is no longer a weekend event. It’s a monthly selling season.
The confluence of storewide sales during a year that’s already seen brands and retailers push to purge through excess inventory begs the question of whether brands and business models are being set up for failure in the long run. Surely, training consumers to anticipate deep discounting around the same time every year will inspire many to stock up on beauty necessities or apparel only around said events.
It will be years before the marketplace fully understands if what businesses are seeing today will trigger new consumer behaviors around deals.
Ask TJX Companies Inc. CEO and President Ernie Herrman what he thinks of the current marketplace as the beneficiary of the inventory clearing, and he’ll give an interesting take.
The head of the largest off-price retailer in the world – operator of nearly 5,000 stores – has seen “outsized” growth from Gen Z and Millennial shoppers, Herrman told analysts last week during the company’s earnings update.
The owner of T.J. Maxx and Marshalls saw apparel same-store sales, which includes accessories, up in the mid-single digits during the quarter ended Oct. 28. Apparel increases alone came from all demographic groups and regions.
“The marketplace continues to be loaded with quality merchandise and we are set up extremely well to offer a wide range of good, better and best brands to consumers,” Herrman said.
The CEO has more or less repeated the same sentiment the past few earnings calls. TJX has benefited from lackluster apparel sales across department, specialty and online retailers that’s helped broaden its assortment of brands, according to Herrman.
“We mean more to the vendors today than ever before,” Herrman said of the “spill off” in product being made available to the off-price channel.
Alternative Retail
Alternatives to the traditional off-price retailers have also emerged in a big way this year.
One need not look any further than sample sale organizers, such as Eclipse, which has a brick-and-mortar location on Robertson Boulevard. The company’s put on a number of sample sales this year with contemporary and luxury brands locally and in other states, such as New York.
There’s also been the interesting emergence of Alternative Retail, based out of Santa Ana, Calif.
The company organizes warehouse sales for what’s been predominantly action sports apparel brands in Orange County this year. Shoppers RSVP to sales free of charge and receive one hour to shop the sale. Alternative Retail gets rid of slow-moving product for brands and, in some cases, has helped temporarily fill vacant retail space. This includes the upcoming O’Neill warehouse sale starting Nov. 24 in Carlsbad real estate previously occupied by Sears.
“Our mission is to partner with brands to provide alternative off-price solutions, while maintaining focus on their brand integrity,” Alternative Retail says in the about section of its site.
Full-Price Snap Back?
With off-price on fire, this brings the fashion and retail industry back to Black Friday sales.
The industry’s days away from what’s traditionally been Black Friday – you know, the actual Friday after Thanksgiving. That’s historically kicked off the holiday selling season.
Seeing as how some retailers have been pricing categories or their entire stores at varying percentages off – some as high as 40% – since the start of this month, the aggressive posturing is perhaps good for the deal-focused consumer.
But brands and specialty retailers are likely to feel the heat of the price slashing from larger peers operating on quarterly timelines for investors.
“This year we’ve seen more and more consumers delaying their spending until the last moment,” Brian Cornell, CEO of Target Corp. said during last week’s Target earnings call.
What Target and Walmart Corp., which are viewed as bellwethers for where consumer sentiment is at, see in more cautious consumer spending is further fueling the discounting or value pricing philosophy conditioning the average shopper.
Certainly, the early Black Friday sales could be a blip on this year’s retail radar and the industry snaps back to full-price selling come 2024 or 2025. For the sake of brand equity and business longevity, fingers crossed that’s the case.
Be First to Comment