Thinking about the looming holidays brought up a couple questions on our minds about the year’s biggest shopping day.
But first, a little history. Apparently, the term Black Friday was coined in 1966 in Philadelphia, as it was a day the police force came to hate due to the increased pedestrian and vehicle traffic and the general chaos (even violence) surrounding the holiday shopping crush. The idea that it signifies retailers getting into the “black” (profitable) from being in the “red” (loss) for the first ten-plus months of the year came along much later.
How do retailers determine their pricing strategies?
When it comes to Black Friday pricing, you need a PhD in Economics to even begin to understand the complex methodology that goes into it. But it basically comes down to this: offering prices low enough to make customers want to camp outside your front door.
The rule is there is no rule. Every retailer seems to have a different strategy and a different threshold for discounting their products and services—the one constant being a desire to create as much hype as possible. But really, much of the process is trial and error—and studying what’s worked in the past. Even so, just because it worked last year, it doesn’t mean it will work this year.
What’s the frenzy all about?
What about Black Friday turns regular civilized people into a frenzied mob? Buying is an emotional experience. And no single day of the year engages emotions for many like Black Friday. Here’s how some psychologists explain it:
Time Pressure makes us nutty. Creating a sense of urgency puts people in the spending mood. Nobody wants to miss out on special “one-day only” savings. Unfortunately, it also makes them use poor judgment, either buying things they don’t need or not doing enough research first.
Scarcity makes us want it even more. Those limited time offers tap into a basic human emotion that goes back to caveman days. If there’s not enough to go around, a bell goes off in our heads that we have to have it. We don’t want to miss out on that new waffle maker, even if we already have one.
The thrill of the hunt. Black Friday feeds people’s competitive spirit. There’s something satisfying in knowing you saved money or landed the last of a hot item. It makes the buyer feel like he or she “won”.
For whom are people shopping?
That depends who you ask. While most people think of the day after Thanksgiving as the official kick-off to the holiday gift-shopping season, a large percentage of people seem to be out to score a great deal for themselves.
According to a recent survey, 44% of all Black Friday shoppers were looking out for number one. Of male shoppers, 51% were ready to pick up a new TV or laptop for themselves. In terms of age groups, the most selfish (57%) were those between 18-35. The most selfless? Of people 36-54, only 31% said they were shopping for themselves—not exactly surprising, since this is the group with kids at home to buy holiday gifts for.
So, for those of you venturing out on Black Friday either for yourself or others, have fun and be safe. And remember, a waffle maker makes a great stocking stuffer.