Black Friday is the unofficial name for the Friday following Thanksgiving Day in the United States and a kickoff for the holiday shopping season. Historically, this has always been the best time to find great deals on all items and also, it's the busiest shopping day of the year. It’s estimated that over 174 million consumers shop online during this period making it more popular. But are you wondering how Black Friday got its name? You probably are not the only one. Below is the history of Black Friday and how it came to be.
History of Black Friday
The history of Black Friday started back in 1869 which was then used to refer to financial crisis instead of a holiday shopping day. This name was associated with two notoriously ruthless Wall Street financiers, Jay Gould, and Jim Fisk. The two worked together to buy up as much as they could of the nation’s gold leading to the crash of the U.S. gold market on September 24, 1869. They aimed to drive the price sky-high and sell the gold for astonishing profits. This led the stock market into free-fall and everyone including Wall Street barons and farmers were left bankrupt. Now, the shopping story related to Black Friday sales links it to retailers. Basically, after an entire year of operating at a loss (“in the red”) stores look forward in earning a profit (“in the black”) on the day after Thanksgiving, because many customers blow money on discounted merchandise. It’s true retailers used to record losses in red and profits in black, but the story behind Black Friday sales may be somehow inaccurate.
Black Friday Sales History
According to the National Retail Federation (NRF), holiday shopping season consist of November and December. The NRF started tracking Black Friday sales in 1992 and in 2008 the sales fell by 4.6% from the prior year. So far this was the only time holiday sales dropped since the beginning of tracking. Typically, the sales rose by 3.4% each year apart from that year. In 2009 the Black Friday sales increased by 0.3% which was more than the stores had gained during the entire year. In 2010, Black Friday weekend sales were $45 billion which was a 5.2% increase from the previous year. This made more stores to come up in the following years increasing competition and it saw an overall increase in sales by 4.6%. Onwards the sales continued to increase helping many retailers make profits while also offering bigger discounts in almost all the items.
Black Friday In Different Countries
- Romania: Surprisingly Black Friday is popular in Romania. The Romania Insider says that the concept was imported in 2011 by Romania online retailer eMAG. The eMAG CEO claims that 11 million Romanians (out of 20 million total) have an idea of Black Friday and 6.7 million looks forward to shopping on Black Friday.
- Canada: Canadian retailers instituted Black Friday shopping holiday to strengthen the Canadian dollar in the 2000s and 2010s. It might not be quite as big a deal as it is in the U.S. but Black Friday is now a popular Canadian shopping holiday as of now.
- United Kingdom: In the U.K. Black Friday originally referred to the Friday before Christmas, the traditional start of Christmas holiday week. In the 2010s, U.S. companies such as Amazon, as well as U.K. based Walmart subsidiary ASDA and other leading U.K retailers started promoting “American” Black Friday in November. Now, this holiday is quite controversial in the U.K., despite producing more than two billion pounds in economic activity and officially taking the crown as the country’s busiest shopping day in 2015.
- Germany, Austria, and Switzerland: In these countries, Black Friday is a clearinghouse for domestic and international brands and retailers that offer special deals.
Do Retailers Need Black Friday to Turn an Annual Profit?
Major retailers like Amazon, Walmart, and Best Buy are generally profitable throughout the entire year. Other stores at least strive for profitability within the year giving them a fighting chance when it comes to surviving the market. However, some smaller outlets may use a big holiday shopping season like Black Friday to generate profits for the entire year.
Is Black Friday Still Relevant?
There is no doubt that Black Friday remains a crucial shopping holiday, but it’s no longer paramount. Neither is it true to say that Black Friday marks the start of holiday shopping season anymore. This is due to the fierce, even desperate competitive tactics used by many retailers to attract more sales. These days many stores are offering discounts anyhow and when they want, making consumers free to shop when and how they please. Additionally, this gives retailers facing increased competition from online-only stores like eBay to invest in “event shopping” days throughout the year. Even better, Cyber Monday marked the first real challenge to Black Friday’s dominance. Statistics show that it’s now arguably bigger than Black Friday itself. Ultimately, there are so many myths associated with the History of Black Friday, however, the above gives you the details of how exactly Black Friday came to be. Regardless of the regions, many other countries around the world celebrate this end of year holiday. Major retailers and retail trade associations have continued to popularize this event in many countries and we should expect to see more Black Friday crazy sales for years to come.