Emergence of the Black Friday Shopping Holiday

Black Friday is Beginning to Eclipse Thanksgiving

As Thanksgiving approaches many people are looking forward, not to the festive dinner with family and friends but to the Black Friday sales that traditionally start the day after Thanksgiving but are increasingly starting right after people finish their Thanksgiving dinner.

In fact for many Thanksgiving is changing from being the main holiday and more the eve of the bigger Black Friday holiday.

Black Friday itself has emerged as a memorable day in the year with its own traditions only within the past century or so. This was due to the economic growth spawned by the nineteenth century Industrial Revolution which in turn gave rise to a rising urban middle class that suddenly found itself for the first time in history with more leisure time and money.

Wal-Mart Parking Lot on Black Friday
Wal-Mart Parking Lot on Black Friday | Source

Celebration of Christmas and Thanksgiving Changing Over Time

Christmas, which has long been both a religious and secular holiday observed by Christians who celebrate it with religious observances followed by getting together to celebrate with food and some exchanging of presents, began to change and grow in popularity as a result of this economic change.

The secular aspects of the holiday expanded with more feasting and gift giving. While still retaining its religious traditions among Christians, both Christians and non-Christians jumped into the secular side of the Christmas celebrations and the growing commercial activity surrounding Christmas.

Thanksgiving has been observed in the United States since colonial times. The observance has been in the fall and frequently in November with the fourth Thursday in November being the date in the late nineteenth and early twentieth centuries. Since 1941 the date has been set by law as the fourth Thursday in November.

Black Friday is Traditionally the Day When a Merchant's Bottom Line Changes from Red to Black

With manufacturing being the major economic sector in the United States during the latter part of the nineteenth century and much of the twentieth century, factory owners found it inefficient to close their factories on Thursday and then re-open for one day on Friday. In the interests of economy, most factory workers ended up with a four day weekend over Thanksgiving.

Since Christmas falls about a month before Thanksgiving, many decided to take advantage of the day off on the Friday after Thanksgiving to start their Christmas shopping. This proved to be a boon for retailers who suddenly saw their sales jump the day after Thanksgiving.

For many retailers, the Friday after Thanksgiving turned out to be the day where the bottom line number in their account books changed from red (signifying that the store was losing money) to black (signifying the store was making a profit).

With the end of the year falling a little more than a month after Thanksgiving, the Friday after Thanksgiving was the day that tipped the scale from loss to profit for many retail establishments. Of course, the heavy Christmas holiday shopping also resulted in improved bottom lines for manufacturers, wholesalers and others involved in the production distribution and selling of Christmas gift items.

Black Friday Shopper looking for a deal
Black Friday Shopper looking for a deal | Source

FDR Changed Date of Thanksgiving to Increase Christmas Shopping Season

President Franklin Roosevelt
President Franklin Roosevelt | Source

President Franklin Roosevelt Tried to Stimulate Economy by Attempting to Start Christmas Shopping a Week Earlier

By the late 1930s consumer spending during the Christmas shopping season was such that it had a noticeable impact no only sales and revenues of businesses but it also resulted in higher incomes for many people along with more tax revenue for the government.

President Franklin Roosevelt attempted to add extra stimulus to the economy by moving the date of Thanksgiving back a week in order to extend the holiday shopping season. He did this in both 1939 and 1940 after which an angry public forced the Democratic majority in both Houses of Congress to enact a law mandating that Thanksgiving be the fourth Thursday in November.

With the date of Thanksgiving fixed by law, producers and retailers were now assured of large crowds of shoppers on the Friday after Thanksgiving.

Growing Economy Meant More Buyers and More Sellers

Continuing economic growth and the associated rising incomes for most sections of society left consumers with more discretionary income which led to an increase in demand for consumer goods overall as well as increased demand for these goods as gifts during the Christmas season.

This increase in demand led to existing producers and retailers increasing the amount of goods they produced and sold as well as causing more producers and retailers to enter these sectors of the economy. Not only were more producers now producing more goods but the sheer number and variety of goods was also increasing as businesses continued to devise new things for people to buy.

Tablet computers, cell phones, digital cameras, eBooks, video games and satellite GPS devices to name a few, all were unheard of a few decades ago. Today most Americans own one or more of these devices.

More shoppers meant a bigger pool of Black Friday buyers. At the same time the greater number of producers and retailers meant more competition for the shoppers’ money. This has led to each year’s increasing frenzy of advertising and discounting.

Do Sales Affect Your Buying?

Are you more likely to buy a product if it claims to be on sale?

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Black Friday Sale Prices Include Profit for Retailer

This competitive discounting raises a question of whether retailers are making money on Black Friday or if they are losing it.

An article by Suzanne Kapner entitled Black Friday: A Retail Illusion, which appeared in the

November 26, 2014 issue of the Wall Street Journal, claims that, according to many industry insiders, the discounts are built into Black Friday items at the start. In other words, the discounted price is the price that the seller intends to sell the item at and make a profit.

What the stores usually do is put the product out for shoppers a few days before Black Friday and list it at the high non-discounted price knowing that most shoppers will wait for the Black Friday sale. While they may sell one or two of the item at the so called original price, they expect to profitably sell the majority of the item at the discounted price.

Thus, Black Friday sales are not attempts to clear unsold or slow moving inventory. Instead, these sales involve pricing strategies designed to give the illusion of a discount while still yielding a profit. Even though the price of most Black Friday items includes a profit, to be successful the sellers have to sell the Black Friday items quickly as the cost of the items sitting on shelves or in warehouses for any length of time will quickly consume the expected profit.

During the rest of the year many of these products are often available at the so called original price.

However, at other times of the year producers and retailers may be dealing with smaller quantities of these products which usually results in a higher cost per unit to produce and ship.

More importantly, during the rest of the year many buyers assume that low prices mean low quality and will not buy. However, on Black Friday, buyers expect deep discounts and are out to find deals and expect to do a lot of buying in one day.

How Price is Determined in a Free Market

In a free market economy consumers are free to buy or not buy goods and sellers are free to sell or not sell goods.

The sale of an item is always a win-win event for both buyer and seller. This is because the buyer has money and wants an item while the seller has an item and wants money. If the price is too high the buyer won’t buy and if the price is too low the seller won’t sell.

However, when the price is at a point where the seller is willing to sell and the buyer is willing to buy, the exchange or sale will take place.

It takes place because the buyer feels that the item being purchased is worth more to him than the money being given up at that time. In the same vein, the seller feels that the money she received is worth more to her at that time than the item she is selling.

Tourist shopping in the old bazaar in Tunis, Tunisia
Tourist shopping in the old bazaar in Tunis, Tunisia | Source

Throughout history, shopping for anything other than the bare necessities needed to sustain life, has always been about more than exchanging money for a particular good.

From the ancient bazaars in the Middle East, to the fairs in medieval Europe to today’s shopping malls shopping is an experience as well as the acquisition of goods.

Merchants everywhere seek to offer goods that meet buyers’ needs beyond the utilitarian aspects of the product and they go to great lengths to display their goods in the most enticing ways.

Black Friday is Not a Shopping Day - It is an Event!

Black Friday is not a shopping day. Any merchant that approaches it as another day to sell product will lose sales and money big time. Any consumer who sees it as just another day to shop will more than likely return home empty handed and frustrated by the chaos and madness of it all.

Do You Like Black Friday for The Fun of It or for Shopping?

Do You Participate in Black Friday for Shopping or the Fun of Finding Deals

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No, Black Friday is an event similar to a big game between two rival teams, the first day of hunting season, a rock concert, etc.

People go shopping on Black Friday to be a part of the madness. They are seeking the thrill of landing big deals, outwitting rivals with their strategies for quickly finding and buying the right items, for successfully navigating the lines, successfully finding a parking place, etc.

Just watch and listen as Black Friday shoppers talk about their plans and anticipate the big day. Afterward, listen as they recite to one and all the stories of their Black Friday successes and defeats.

Black Friday Door Busting Frenzies

© 2013 Chuck Nugent

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4 comments

Chuck profile image

Chuck 3 years ago from Tucson, Arizona Author

Genna East - I'm glad you enjoyed this Hub. Thanks for your comment. And I agree with you to some extent about Black Friday detracting somewhat from Thanksgiving which is why I noted in the Hub that, for some people, Thanksgiving is becoming Black Friday Eve.


Genna East profile image

Genna East 3 years ago from Massachusetts, USA

While I understand the merchant's zeal behind Black Friday, I can't help but feel that it deters from the Thanksgiving holiday. Excellent write, Chuck, that is filled with helpful info. Thank you.


Chuck profile image

Chuck 3 years ago from Tucson, Arizona Author

MG Sngh - I'm glad you enjoyed this Hub. Thanks for your comment


MG Singh profile image

MG Singh 3 years ago from Singapore

Interesting and informative.

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