The coronovirus epidemic caused retailers to change their outlook for the holiday shopping season, opening the promotional window for Black Friday much more than in previous years. And some retail industries believe that customization may become standard practice going forward.
“We are seeing a fundamental change in the promotional calendar,” said Steve Sadow, former Sachs president and chief executive officer, in CNBC’s “Squawk Box” on Friday. “I think the retailers have done a fantastic job extending the season, and we will go out as soon as next year,” he said.
In an environment where the epidemic has led more and more consumers to online channels, it should prove beneficial to avoid significant shipping delays for pre-holiday orders that are placed after the first few weeks of December , Saidov also said.
According to former Walmart US President and CEO Bill Simon, the idea of lengthening Black Friday is not new to retailers. “They’ve been trying to do this for years and haven’t had any success, and this may just be the year they pull it off,” Simon said in a “squawk box” interview with Sadow.
For big box retailers, especially his former company, Walmart and Target, Simon stated that Black Friday’s willingness to accept an extended period of time relied less on their physical stores to succeed in e-commerce. Depends on the capacity.
“They are moving from a channel dominated to a channel where they are far behind Amazon”, Simon said. “They are going to catch on very quickly, or they are going to try to change the calendar back for more physical and more Black Friday because they are not going to like the results.”
Saidov, who led Sachs from 2007 to 2013, said he believed it would be a “combination of the two” in the coming years. One reason for this, he said, is the strong sales that have been experienced so far this fall.
He said, “I think everyone is benefiting from the early burst. You have seen this huge increase year after year and it continues and I think it will take a large amount for the holiday season.” . ” “I think retailers are going to try and play it both ways, where they continue the initial promotion. And then Black Friday-CyberMonday is coming to terms with a big burst.”
Whatever the way forward for Black Friday deals, Simon said he worries about the sustainability of being too heavily targeted towards e-commerce, as retailers need to buy products that are not just on sale Huh. He said that online shoppers can only deal with cherries.
“If you only sell the deal, you’re going to lose money. It’s not just set that way. You have to sell wrapping paper and Christmas lights and candy canes and everything else that goes with it or you. “I’m just not going to make it,” said Simon, who oversees Walmart US from 2010 to 2014.
Sadov said the challenge could be mitigated by online purchases at physical retail locations. “That’s where you get some margin growth,” he said. “Online shopping, especially with low-end price points, is very difficult. When you buy online, pick-in-store – and big boxes have done it well – that really wins.”
Follow CNBC’s update on Black Friday here.