If we told you there was an entire industry built around the success of one weekend, would you believe us?
Welcome to the topsy-turvy world of retail shopping.
The fact is, when consumers spend upward of $665 billion with 500,000 new credit cards, all over Black Friday through Cyber Monday, you can expect some very interesting data points in the retail space.
Just look at the annual sales for some of the largest retail chains:
Q4 sales isn’t just a spike in their revenue, but as NPR reports, it’s when many retailers typically start to turn a profit at all. And it’s not on bargain-basement deals. As retailers have become more savvy, they’ve learned to promote heavily and discount a few big-ticket items to attract aggressive shoppers and turn that traffic into bigger sales. The phenomenon is seen on Black Friday, Cyber Monday, and now even “Great Thursday,” or early events starting the night of Thanksgiving.
This strategy, in turn, can have a dramatic impact on the cost of that revenue:
Look at how flat the revenue numbers and cost of that revenue are during all other quarters of the year. This spiking phenomenon isn't limited to traditional brick-and-mortar retailers, either. Here's Amazon's data:
....although it's interesting to note that Amazon's numbers are trending upward, while many brick-and-mortar retailers are headed in the opposite direction.
It’s no big surprise that holiday shopping is a huge factor in the success of retail, whether it’s online or in-store. The bigger surprise is the degree to which every dollar counts. Without Black Friday, many retailers might not be in business at all. And there’s no other industry that counts on such a small window of opportunity to make payroll for the rest of the year.
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