Black Friday this year ‘will be unique’ as consumers return ‘to pre-pandemic behavior’: ICSC CEO

ICSC CEO Tom McGee breaks down the circumstances around this year's Black Friday holiday shopping as malls and retailers are heavily stocking their shelves and expecting high retail sales.

Video Transcript

AKIKO FUJITA: Well, consumers are expected to shell out nearly $110 billion alone on Black Friday. That's according to a new survey out from ICSC. Shoppers are expected to spend more than $490 between Black Friday and Cyber Monday. Let's bring in Tom McGee. He is the CEO of ICSC. And Tom, you know, every year, I wonder if this is the last year we're going to talk about Black Friday and Cyber Monday, because there's so many shopping events that are out there now that offer very steep discounts. How big of a bump do you anticipate retailers are going to get this year?

TOM MCGEE: Well, first of all, thanks for having me on. You know, just broadly speaking, we expect this to be a super strong holiday season. Our forecast is for 8.9% growth year over year. We're very confident in that projection. And of course, retail sales to date have been quite strong. Look, I think Black Friday and now Cyber Monday are iconic days. I think Black Friday this year in particular will be unique, because in many respects, we're returning back to some pre-pandemic behavior.

And I do expect there to be super strong traffic over the Thanksgiving holiday weekend, and particularly, on Black Friday. You know, our expectation is about 3/4 of Americans will shop on Black Friday, whether that's in a store or online. A similar number will shop on Cyber Monday. So I do think it's a-- you're going to see strong demand on that day, but there clearly has been strong demand throughout the holiday season. A lot of shoppers shopped early for the reasons that Dan mentioned, concern around supply.

But although there has been strong demand to date, I don't believe that that is going to impact demand through the balance of this holiday season. I think people are leaning into this holiday. And despite some concerns around inflation, et cetera, the strain on consumer expectations has not yet translated into an impact on consumer demand.

JARED BLIKRE: No, and I'm seeing it in the stores, the physical stores. We just had that stat up on the screen, 49% of shoppers plan to do it in physical stores. And that's what we're seeing, a return to the mall this year, as people do-- well, not only shopping. There's a lot of other things going on in this article that you're sending us that you're writing. I noticed you have some interesting stats about what people are physically doing in the mall.

TOM MCGEE: Yeah, you're seeing a lot of people-- look, marketplace by definition has a whole lot of dining options, right? It's a place that people shop, dine, play. And I think you're going to see a significant number of people and have seen a significant number of people dying. Since the pandemic has begun to ease, dining out, getting together for holiday lunches and dinners is a part of the holiday season. And so our expectation is that a significant number of people will dine this weekend.

But all throughout the holidays and, quite frankly, while that increases food and beverage sales, folks in malls and shopping centers dining generally translates into product demand as well, because you're there. You're going to go shopping. It increases foot traffic in stores.

AKIKO FUJITA: Prior to the pandemic, we talked a lot about these doorbuster deals on Black Friday, which is the reason why we had so many consumers lined up outside stores. To what extent are the discounts steeper in store this time around? Or do you think because so much of the shopping has moved online now, there's not necessarily an advantage to going directly into the store?

TOM MCGEE: Well, you know, I think that first of all, I think people expect there to be promotions on Black Friday weekend. I mean, there is a consumer expectation. Our survey would suggest that about half of shoppers, one of the driving factors for going shopping, whether it's on Black Friday or Cyber Monday or throughout that weekend, is promotions. So I do think you're going to see a healthy dose of that. I don't know that you're going to see the level of promotions that you've seen in the past for lots of reasons, not the least of which is, we're in a very strong retail environment.

We're in an inflationary environment. There's been a lot of promotions that have already taken place as retailers try to pull consumers in to shop earlier to deal with some of the supply chain issues. But I do think you're still going to see some doorbuster promotions. That's part of Black Friday. And so, while you may not see the level of that you've seen in the past, there will be plenty to be had.

JARED BLIKRE: Well, and another thing that's different this year, a lot of big box retailers have mercifully are not going to open on Thanksgiving Day, so we can eat our meal in peace without having that one person in our midst who feels compelled to go out and shop on that day. I'm just wondering if that changes any of the dynamics here.

TOM MCGEE: You know, that's been a trend over the course of the last almost decade where you've seen a lot of large retailers, and even shopping centers, just close for the Thanksgiving Day to allow their employees to enjoy family time. And so, you know, I don't think it's going to have an impact upon the holiday season. I mean, it just spreads that demand out over a longer period of time.

You know, one of the interesting things, I think that Saturday of that holiday weekend, which has become a synonymous kind of small business and local business, Small Business Saturday, you're are seeing increasing traffic on those days. And I do think you'll see that this year as well. I think you'll see more people shop this Saturday, particularly with that focus upon trying to support small businesses. As we all know, those businesses were particularly hard hit by the pandemic. And we all have an interest in supporting small local businesses. And so I think you'll see more activity this Saturday. But generally speaking, closing on Thanksgiving, I just think, spreads the spend over the course of the longer holiday.

AKIKO FUJITA: Yeah, I'm glad you added that reminder, Tom, about small businesses, certainly the ones that are hurting the most during this pandemic. Tom McGee, CEO of ICSC, good to talk to you today.