Best Buy Biggest Winner On Black Friday Weekend: Analysts
By: Alan Wolf | December 5, 2011
NEW YORK – Early-bird shoppers aside, who were the big winners over Thanksgiving weekend?
According to The NPD Group, Best Buy was the fourth most frequently shopped retailer behind full-line merchants Walmart, Target and Amazon, which sell a much wider variety of products. Best Buy also enjoyed the highest conversion rate, with more than 58 percent of shoppers actually making purchases, compared with just 38 percent last year, representing the largest gain among the four rivals.
Credit Suisse retail analyst Gary Balter concurred with NPD’s assessment based on Black Friday store visits in several markets across three states. “Best Buy seemed to be the relative winner as stores were at least as busy as last year and traffic was solid well past the initial doorbusters,” he wrote in a research note.
Levin Consulting, which fanned out across more than 200 stores on Black Friday, agreed. “Our team was very impressed with Best Buy’s execution, and with how they are going directly after Walmart and Amazon in terms of pricing,” noted CEO Adam Levin. “They have leadership in the hottest categories [and] we were also impressed with their multi-channel approach this weekend, making the specials available online.”
At the same time, added Balter, Best Buy offered “unique in-store-only offers forcing the visit.” Indeed, Anthony Bonevento, general manager of a 33,000-square-foot Best Buy store in Holmdel, N.J., reported a record turnout of 1,000 early-bird shoppers by midnight of Black Friday. Most queued up for hours, and in one case more than a day, for a chance to snag a 60-inch 1080p Sharp LED TV for $800, a 55-inch 1080p Samsung LED TV for $1,000, a 42-inch 1080p Sharp LCD TV for $200, a 15.6-inch dual-core Lenovo laptop for $180, a 24-inch 1080p Dynex LCD TV for $80, and a Toshiba Internet-ready Blu-ray Disc player for $40.
“It’s hands-down bigger than last year,” Bonevento told TWICE. “In fact, it’s the biggest crowd in four years.”
Elsewhere, Kmart, which was open for the 20th consecutive year on Thanksgiving Day, said customers started arriving as early as 2 a.m. on Thursday. Store managers reported the Ario 32-inch TV ($199), Leader i7 tablet ($100) and a 7-inch Sylvania netbook ($80) among their hottest sellers.
Sister chain Sears opened its doors at 4 a.m. on Black Friday, but customers lined up as early as midnight to snag more than 900 doorbuster deals including the 60-inch Sharp LED for $1,000, a 42-inch Panasonic LED for $600 and a Kenmore laundry pair for $470.
Even after the initial doorbuster crunch, “both Sears and Kmart stores across the country continued to experience a steady flow of foot traffic,” a Sears Holdings spokesman said.
Amazon.com described Black Friday as “the best ever” for its Kindle family of e-readers, while the new Kindle Fire tablet continued as the company’s bestselling product since its introduction nine weeks ago.
“Customers purchased four times as many Kindle devices as they did last Black Friday – and last year was a great year,” said Amazon Kindle VP Dave Limp. “In addition, we’re seeing a lot of customers buying multiple Kindles – one for themselves and others as gifts – we expect this trend to continue on Cyber Monday and through the holiday shopping season.”
Target merchandising VP Nik Nayar similarly cited Kindle Fire as “the bestselling tablet in our stores on Black Friday.”
For Abt Electronics, Black Friday weekend brought a 20 percent increase in foot traffic and a 13 percent spike in brick-and-mortar sales year over year, while online sales surged 21 percent on Cyber Monday and website traffic rose a record 29 percent, president Jon Abt reported.
eBay similarly reported brisk business on Cyber Monday, with some CE deals selling out in minutes. Among them: an Xbox 360 250GB Kinect Bundle for $260, which sold at a pace of 75 units per minute and sold out in 20 minutes.
Buy.com said sales over Thanksgiving and Black Friday grew by double digits year over year, spurred by free shipping, reward points and the growth of its 4,000-reseller marketplace. “Our initial holiday results point to a strong start of the season, as consumers responded favorably to our expanded selection of products and our newest initiatives,” said president/CEO Neel Grover.
Conversely, the office-supply channel appeared to take a backseat to the CE selling frenzy, having cut back significantly on electronics from last year, observed Credit Suisse’s Balter. Levin of Levin Consulting concurred. “The office superstores seemed to sit out this weekend. They ran flyers, but the deals were so weak that traffic was incredibly light.”
Levin added that RadioShack and Sears both saw limited store traffic due to later openings and fewer strong deals, while Walmart was among the weekend warriors. “No one understands and delivers better day-in and day-out on low prices,” he noted.
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