Holiday deal hunt draws millions out to stores across U.S.

SHOPPERS WAIT in line outside a Best Buy Co. store ahead of Black Friday in San Francisco on Nov. 27. An estimated 140 million U.S. shoppers will hit stores and the Web this weekend in search of post-Thanksgiving discounts, kicking off what retailers predict will be the best holiday season in three years. / BLOOMBERG/DAVID PAUL MORRIS
SHOPPERS WAIT in line outside a Best Buy Co. store ahead of Black Friday in San Francisco on Nov. 27. An estimated 140 million U.S. shoppers will hit stores and the Web this weekend in search of post-Thanksgiving discounts, kicking off what retailers predict will be the best holiday season in three years. / BLOOMBERG/DAVID PAUL MORRIS

NEW YORK – Holiday shopping in the U.S. kicked off earlier than ever this year, leaving some customers who didn’t want to skip out on their Thanksgiving celebrations without the bargains they were seeking.

Andre Marshall, a 32-year-old musician from Brooklyn, arrived at a Best Buy Co. store in the borough at 6 a.m. today and waited two hours in the cold in hopes of scoring a 50-inch Panasonic television for $200. The while-supplies-last deal had run out by the time he arrived, so he settled for a 40-inch Insignia TV for $200 instead.

“Now you can’t even spend Thanksgiving with your family because you have to come down on Thursday and get the stuff,” Marshall said. “It’s not Black Friday anymore, it’s Black Thursday Night.”

Marshall was one of the 140 million Americans that the National Retail Federation expected to hit the stores or shop online yesterday through Sunday. The shopping rush kicks off a holiday season that the NRF forecasts will be the best in three years, helped by falling unemployment, rising wages and lower gas prices.

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Shoppers seeking bargains yesterday had plenty of options. J.C. Penney Co. unlocked its doors at 5 p.m., compared with 8 p.m. in 2013. Macy’s Inc. and Target Corp. opened at 6 p.m., two hours earlier than last year.

“Being first is incredibly important,” said Pat Dermody, president of Retale, a mobile application that aggregates circulars from major retailers. “If you’re first, you’ve got customers who are full of spirit and full of cash.”

In Rhode Island, Massachusetts and Maine, however, state laws prevented some retailers from opening their doors on Thanksgiving. Only small grocery stores, gas stations and pharmacies were open, meaning those in search of bargains had to wait until midnight.

Weeklong Event

Many consumers already may have begun shopping as retailers experimented with spreading their deals throughout the week. Express Inc. began offering 50 percent off everything starting Nov. 25 through noon today, and Target rolled out pre-Black Friday deals of up to 60 percent off on some items.

Wal-Mart Stores Inc. is meting out its holiday bargains over the course of five days. The retailer’s “New Black Friday” event includes sales in stores and on that began at 12:01 a.m. yesterday and run through Cyber Monday.

“They took what was a small, compressed event and made a week out of it,” Rod Sides, who tracks retail for consulting firm Deloitte LLP in Charlotte, N.C., said in an interview. “Everybody used to have a battle strategy. Folks are not as focused on Black Friday as they once were.”

Wal-Mart sales

Wal-Mart said today that tablets, televisions, sheets, children’s apparel and video-game gear were the top five categories for sales in its stores last night. Disney Frozen Snow Glow Elsa dolls were among the top toys of the night, Laura Phillips, senior vice president of merchandising for Wal-Mart U.S., said in a statement.

Target said the top-selling items in its stores were electronics and housewares, including Keurig K40 coffee brewers, Element 40-inch TVs, Microsoft Corp. Xbox One game consoles and Apple Inc. iPads.

Macy’s CEO Terry Lundgren said today in an interview on Bloomberg Television that activewear and outerwear have been the big sellers for the department-store chain so far.

“This is an outerwear season for the cold-weather climate stores,” he said. “There was a little snow coming down, and it motivated people to buy more coats.”

Spending more

While about the same number of people as last year were expected to shop yesterday through Sunday, they are projected to spend more, according to the NRF, a Washington-based trade group. Retail sales in November and December may rise 4.1 percent this year, beating last year’s 3.1 percent gain, the organization said.

More of those purchases may take place online instead of in brick-and-mortar stores. Shoppers plan to do 44 percent of their gift buying on the Web, the highest percentage ever, the NRF said last month. Thanksgiving Day online sales gained 14 percent from a year earlier, International Business Machines Corp. said today.

Sales already are getting a hand from consumer sentiment that’s the highest since before the recession, boosting confidence that the trend will continue through the holiday season. Consumer spending, which accounts for about 70 percent of the economy, grew at a 2.2 percent annualized rate last quarter, exceeding estimates for a 1.8 percent improvement. The gain was spread across durable and non-durable goods.

Consumer spending

Consumer spending also may be buoyed by gasoline dropping below $3, a psychological barrier that may help open up wallets, said Bob Drbul, a New York-based retail analyst at Nomura Securities International. The average cost of a gallon of regular gasoline was $2.81 earlier this week, the lowest level in four years, according to the automobile group AAA.

To capitalize on the extra spending money, retailers are trying to one-up each other. Wal-Mart will sell an RCA tablet for $29, DVDs for $1.96 and a 50-inch high-definition television for $218. Best Buy, meanwhile, will offer a 55-inch Samsung 4K television for $899, down from $1,400.

Not that the discounting frenzy is anything new, said Retale’s Dermody, who’s based in Chicago.

“I wouldn’t say, on a category basis, there are discounts that are outrageous this year compared to what they were last year,” she said.

Demonstrators protesting the police killing of unarmed teenager Michael Brown showed up en masse at about a half-dozen shops and malls across greater St. Louis, disrupting some early Black Friday shopping. While some of the protests led to brief faceoffs with police, no arrests were made, the St. Louis County Police Department said. Some stores temporarily closed or otherwise had to adjust.

Key period

Holiday shopping is key for retailers, with sales in November and December accounting for about 19 percent of annual revenue, according to the NRF. The term Black Friday is believed to derive from the myth that retailers didn’t become profitable until this day each year.

The doorbuster bargains that are the hallmark of the early part of the shopping season are meant to get consumers into stores in hopes that they’ll buy other merchandise closer to regular price or even just items they hadn’t planned on purchasing.

The tactic worked on Jason Marinelli, a 38-year-old contractor from Lodi, N.J., who finished dinner yesterday and went to check out the sales at the Paramus Park Mall, where about half of the stores were open. Marinelli said he wants to spend less on gifts this year but doubts that will happen.

He bought a $200 North Face jacket for his girlfriend, saving about $50, and bought his daughter two shirts at Justice & Brothers, where items were 50 percent off.

“It always ends up being the same or more,” he said. “They get you here with the sales, and next thing you know I’m grabbing things.”