Walmart Black Friday Loses Out to Cyber Monday
Wal-Mart Stores, Inc. (NYSE:WMT), the parent company of Walmart, has generally enjoyed a positive year. Walmart stock has increased about 14% year-to-date, but it dropped three percent over the last three months. This trend suggests that Walmart stock investors expect poor Walmart Black Friday results. Indeed, it’s not just WMT stock investors who seem nervous.
The company itself might be expecting a lackluster Walmart Black Friday. Indeed, Walmart may have perceived a new societal trend away from Black Friday. After all, as America’s largest brick-and-mortar retailer, you would expect Walmart to have good instincts about shoppers’ sentiment.
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Indeed, if you needed concrete evidence of a Walmart Black Friday tradition on the wane, consider this major change. This year, Walmart has decided to launch its online offerings before the traditional Black Friday date, which has for many years opened the holiday shopping season. Analysts expect sales to reach US$3.5 billion. This year, Walmart’s Cyber Monday actually begins at 12.01 A.M. on Friday, November 25. (Source: “Wal-Mart kicks off Cyber Monday on Friday,” Chicago Tribune, November 21, 2016.)
Walmart May Have Decided Shoppers Prefer Cyber Monday to Black Friday
Cyber Monday, traditionally scheduled on the first Monday after Thanksgiving, has been gaining in popularity. Black Friday, meanwhile, has become the target of satire (i.e. in “South Park” episodes and “YouTube” videos). People don’t want to line up, fight over the last items, or engage in parking lot duels for that rare treasure known as an open parking spot.
So, in an attempt to beat the competition, Walmart is shifting its Cyber Monday closer to Black Friday, meshing the two. There’s evidence that this is becoming a thing. Last year, the retailer adopted a similar measure, moving its big sales to the Sunday after Thanksgiving. This combination of Cyber Monday and Black Friday is an attempt to beat online and retail competitors alike.
Thus, Walmart will offer marked-down electronics at the same time as all other—traditionally Black Friday—items. Walmart wants to beat Amazon.com, Inc. (NASDAQ:AMZN) to gain a larger share of online sales. Online sales are the main area of growth in the overall retail space.
Black Friday was first “celebrated” on November 28, 2005 in the United States. But Walmart has strong evidence to shift attention to online retail rather in its physical stores.
Walmart has noted that its online sales rose 20.6 percent year-over-year, thanks in part to six weeks of Jet.com sales, the online business that Walmart acquired during the quarter for $3.3 billion. It was the second quarter of faster-than-usual growth in online sales. (Source: “Walmart Starting Post-Black Friday Online Sales Earlier to Fight Amazon,” Fortune, November 21, 2016.)
The Walmart Black Friday shopping bonanza appears to be heading for a cultural shift. It’s unavoidable. Walmart’s biggest competitor is now Amazon.com, which compels it to sacrifice brick-and-mortar to favor online retail. Walmart stock investors have dictated the trend.
The mere fact that e-commerce sales beat analysts’ expectations, while in-store sales defied them, may have started a new trend. In holiday sales terms, this suggests that Walmart Black Friday could eventually disappear into a sea of Cyber Monday sales.
