Now that everybody's stuffed with turkey and pumpkin pie, it's time to turn our attention to the one topic on every shopper's mind -- Black Friday. Judging from the lines at Target (TGT -0.70%), Best Buy (BBY -0.81%), GameStop (GME 7.58%), and Wal-Mart (WMT 1.32%), it's safe to say that retailers aren't going to be disappointed this year.
Black Friday shoppers at Macy's. Source: Foxbusiness.com
Target lures in shoppers with big consumer electronic discounts
Target launched a pre-emptive strike on Black Friday, opening its doors on Thanksgiving Day at 8 p.m.
At a Target store in Los Angeles, the line had swelled to over 1,000 people by the time the doors opened, and shoppers stormed the superstore in search of some steep discounts.
Some major deals at Target include 40-inch Westinghouse televisions for $200 and Nintendo's (NASDAQOTH: NTDOY) 3DS handheld console, which was marked down from $200 to $150. Early adopters of Apple's (AAPL 1.27%) iPad Air, who received $100 Black Friday gift cards for all iPad models at Target, were back and looking to pick up additional iPads. Target stores will remain open until 11 p.m. on Black Friday.
Best Buy runs Black Friday drills to prepare for mayhem
Meanwhile, shoppers also swarmed Best Buy, the brick-and-mortar consumer electronics giant that is now making a surprising comeback after being trampled by e-commerce giants Amazon and eBay over the past decade.
Best Buy, like many other retailers, runs drills to ensure that its stores run at peak efficiency on Black Friday, the most crucial and chaotic shopping day of the year. In a Best Buy location in Watertown, Massachusetts, employees were required to arrive at work early five days ago to run a "Black Friday simulation" -- the retail equivalent of an air raid drill, where employees practiced techniques in group (rather than one-on-one) selling and crowd control.
This year, some deals at Best Buy include a $100 discount on Apple's iPad 2 (Wi-Fi), $500 discounts on LG 55-inch LED HDTVs, and desktops under $200. Best Buy is also trying to attract customers with bundled items, such as accessories for digital cameras, or peripherals for Microsoft's (NASDAQ: MSFT) Xbox One and Sony's (NYSE: SNE) Playstation 4.
Best Buy locations open at 6 p.m. on Thursday and will remain open until 10 p.m. on Black Friday.
GameStop offers console bundles at steep discounts
Meanwhile, GameStop is offering some huge deals for gamers on Black Friday.
Some top deals include an Xbox 360 bundle including a 250GB hard drive, Halo 4, and Tomb Raider for $199, and a PS3 bundle featuring a 250GB hard drive, The Last of Us, and Batman: Arkham Origins for $199. In addition, GameStop is offering a "buy two, get one free" offer for pre-owned games, accessories, and consoles.
GameStop is also offering an Xbox One bundle that includes Dead Rising 3 and Ryse: Son of Rome, an extra controller, and a $20 gift card all for $700.
GameStop is definitely expecting some major foot traffic at its stores -- it just hired an additional 17,000 employees to staff its stores. However, it remains to be seen if these bundles can compete with those being offered at Best Buy.
Unlike Target and Best Buy, GameStop is not opening its doors on Thanksgiving Day -- it is opening at 12:01 a.m. on Friday morning instead.
The annual Wal-Mart stampede
Meanwhile, Wal-Mart's Black Friday has become a retail event not so much recognized for its discounts, but for the ambulances that are dispatched to the superstores nearly every year.
This year was no exception -- numerous fights have broken out over flat-screen TVs, tablets, and other products, and a man was even stabbed in Virginia. In recent years, Wal-Mart has attempted to curb these violent events by distributing wristbands in high-traffic situations. These wristbands allow shoppers to return two hours after the event to pick up their purchases to avoid the lines and crowds. Best Buy employs a similar chaos-averting system using tickets.
Some of Wal-Mart's top deals during Black Friday include an Emerson 50" LED LCD HDTV for $288, a Funai 32" LED LCD HDTV for $98, and a Samsung 51" Plasma HDTV for $427. Similar to Target, Wal-Mart is selling a $100 Wal-Mart gift card with Apple's iPad mini (16GB Wi-Fi) for $299. It is also offering Apple's iPhone 5C (16GB) and a $75 Wal-Mart Gift Card for $45 -- with a contract, of course.
Wal-Mart locations opened at 6 p.m. on Thursday and will remain open all day on Black Friday. Special doorbuster deals were available at 6 p.m. and 8 p.m on Thursday and at 8 a.m. on Friday.
Why does Black Friday matter so much?
For retailers like Target, Best Buy, GameStop, and Wal-Mart, Black Friday marks the beginning of its most important quarter -- the holiday season that leads straight into Christmas.
To better understand the impact of the Black Friday through Christmas shopping season, simply take a look at the quarterly revenue performance of these four companies over the past five years.
Source: Ycharts.
Those peaks at the end of every year leading into the next year represent the importance of the holiday season to these retailers. However, retailers are dramatically sacrificing margins in exchange for higher sales -- a business model that is ultimately unsustainable unless there is Black Friday-like foot traffic every day.
Therefore, Black Friday is the perfect storm of pent-up consumer demand before the holiday season and the retailers' commitment to putting the pedal to the metal in an effort to generate as much sales as possible in a single quarter.
In closing, enjoy your shopping and stay safe, fellow Fools, and we'll be back to provide you with further updates on the next big shopping day -- Cyber Monday!
